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CME: Net Sales of Beef Higher Than a Year Ago

12 July 2019

US - USDA-FAS issued its latest update on exports of beef and pork muscle cuts, reports Steiner Consulting Group, DLR Division, Inc.

Despite all the data shortcomings regarding these reports that we have noted often in our letter, trade continues to pay close attention to this report and naturally we will continue to cover it. Below are some of the highlights:

Total beef export shipments last week were 14,912 MT, 2.4 percent lower than a year ago. In the last four weeks beef export shipments have averaged 2.8 percent below year ago levels. Higher exports to South Korea and Hong Kong have been offset by lower shipments to Japan and Canada.

The most positive number in the report were new net sales, which last week were estimated at 21,458 MT, 14 percent higher than a year ago. However, we would caution about making too much about this. It seems the number was skewed by a reported sale of over 6,000 MT of beef to Ethiopia, a market that normally does not buy much (any) beef from the US.

We do not know anything about this sale but, if true, it would appear to be a one off event rather than something indicating a trend of higher beef sales/shipments. Beef net export sales to Japan in the last four reported weeks were down 15 percent but higher sales to South Korea have helped offset the lower exports to our top beef market.

The US has a tariff advantage in South Korea due to KORUS FTA while Australia, New Zealand and other markets have an advantage over US beef in Japan due to the new TPP agreement (CPTPP), that does not include the US. A trade deal with Japan cannot come soon enough for US beef producers.

Outstanding beef export sales remain 29 percent ahead of last year’s levels but mostly due to a significant amount of beef sold to Hong Kong, which has yet to ship. Excluding Hong Kong outstanding beef export sales were 5 percent lower than last year.

Daily Livestock Report - Copyright © 2008 CME. All rights reserved.

TheCattleSite News Desk

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