Of course, the beef animal produces a long list of products — chucks, rounds, livers, tongues and other cuts — which in the domestic market have much lower values than the expensive middle meats. Fortunately for U.S. beef producers, consumers in other parts of the world value those products significantly more than American consumers do.

“In the United States,” says Colorado State University meat scientist John Scanga, “we have a name for boneless chuck short ribs — 50 percent lean trimmings. But in South Korea, Japan and elsewhere, the same cut is worth several dollars more per pound.” Scanga adds that although there is little domestic demand for products such as livers, hearts or kidneys, these products offer an affordable source of high-quality protein in countries where consumers have different tastes and smaller food budgets. Optimizing the value of the entire beef carcass is important for producers, he says, and not possible without considering exports.

Cut by cut

Brett Stuart, a Cattle-Fax research analyst who works in new business development, says that to understand the importance of beef exports, you need to look at specific beef cuts and individual markets.
Japan, for example, traditionally has been a big market for beef tongues and short plates. Prior to the 2003 trade ban, beef tongues from the United States sold for up to $6 per pound in Japan. Since the ban, the main market for beef tongues is Mexico, where they bring just $1 per pound. With a tongue weighing about 3.5 pounds, that alone is a $21 per head loss in value.

Gregg Doud, chief economist for NCBA, points out that Egypt currently imports close to 75 percent of all the beef livers produced in the United States. Livers in Egypt are worth about 60 to 70 cents per pound, compared with 12 cents here.

The export market also upgrades the value of certain cuts in the domestic market. Stuart says that prior to 2003 trade bans, the domestic value of short plates was about $1.80 per pound. After the ban, their value dropped to 50 cents per pound. With short plates weighing 30 to 40 pounds, that is a loss of $39 to $52 per head.

Adding up the lost value to individual products when beef exports stopped late in 2003, the Beef Board estimates a total impact of $165 to $190 per head.

Positive growth

The value of U.S. beef and beef variety meat exports for January through October 2006 was over $1.6 billion, Doud says. That total is 57 percent more than that for the same period during 2005, but only about half of what we were exporting prior to December 2003.

Source: Drovers