NCBA: Global Beef Supplies Will Only Get Tighter
US - Global beef supply is expected to fall for the fourth consecutive year, said Brett Stuart at the Cattle-Fax Conference, at the 2011 NCBA Convention and Trade Show. Charlotte Johnston, TheCattleSite Editor reports.
7 February 2011
2 minute read
Global supplies of beef will be tight, said Mr Stuart, as global demand increases.
This does however pose the risk of global beef inflation, as it will take at least three years for supply to increase, said Mr Stuart.
The food inflation index in 2010 saw food prices increase by 28 per cent globally.
In 2010, the value of US beef globally increased eight per cent.
US beef has gained a competitive edge, due to the low value of the dollar.
On top of this, increases in per capita income in the major US beef export markets has increase, which is great news for beef trading - said Mr Stuart.
The US beef business is now worth $35 billion, he said. Compared to in 2000, when the business was worth only $10 billion. Mr Stuart puts this significant increase in value down to the diminishing world supply of beef, and falls of production in countries, that once were leading beef exporters.
Whilst Australia is possibly one of the US's major competitors, Mr Stuart said Australia was beginning to restock after droughts and would continue to restock due to the recent floods. Therefore it would not be until 2012 before larger Australian beef supplies would appear on the global market.
Despite the shortages of global beef supply being a huge opportunity for US beef exports, there is a small concern regarding beef imports.
Mr Stuart predicts that beef imports may increase in 2011, by two per cent. Imported beef into the US are primarily lower cuts of beef, used for grinding. Other than this domestic trimmings are also used.
However if global supply is down, and cattle slaughter in the US is down, where are these supplies going to come from, asked Mr Stuart.
The US is already bidding high prices for Australian trimmings, and competition from other countries is increasing.
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