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China Accounts for One-third of Uruguay’s 2013 Beef Exports

Uruguay’s beef and variety meat exports were up 8.5 percent through July to 180,618 mt, with about one-third of the volume destined for China. China is outbidding Russia and other markets for Uruguayan beef, recording large growth in the following categories: frozen bone-in (10,603 mt, +1,012%), frozen boneless (29,905 mt, +538%) and offals (8,571 mt, +331%).

Uruguay’s frozen export volume was up 5 percent to 128,135 mt, though the per-unit value was down 4 percent to $4,820/mt. Chilled volume was up 12 percent to 23,186 mt, with a steady per-unit value of $9,276/mt.

Uruguay’s exports to the EU were up 2 percent to 25,165 mt, with a 17 percent decline in frozen volume (13,578 mt) offset by a 40 percent increase for chilled (11,587 mt), reflecting larger shipments under the duty-free, grain-fed quota. Uruguay was also able to export chilled beef at lower prices, with unit values for the EU down 9 percent from last year to $10,636/mt. Exports were also larger to Brazil, the United States and Canada.

Uruguay’s cattle slaughter is up 3.3 percent from last year at 1.24 million head, and all of the growth has been in steer slaughter, as Uruguay has been rebuilding its herd after drought in 2008. Uruguay also has a seasonal slaughter due to its pasture-based system and now tighter supplies have begun to elevate prices and slow export volumes. Uruguay’s beef production is mostly grass-fed and mainly from Hereford-type cattle. Uruguay is the only South American country with access to North America for chilled/frozen beef and Uruguay recently gained access to South Korea. Uruguay is not expected to export large volumes to Korea but could compete with New Zealand on frozen grass-fed beef. Korea reports imports of beef from Uruguay reached 85 mt in the first half of the year.

With its superior market access, due mainly to its FMD-free-with-vaccination status by the OIE, and superior traceability system, Uruguay has the ability to ship its beef to the highest bidder. China emerging as the largest taker of Uruguayan beef shows the strong demand and value in the Chinese market. Uruguay’s cattle prices have trended higher in recent months (see below), due partially to the seasonal impact on slaughter but also continued export growth. The wide spread between U.S. and Uruguayan prices is because U.S. cattle are primarily grain-fed and the U.S. dollar is stronger than in the first half of 2011.

Uruguay’s beef and variety meat exports were up 8.5 percent through July to 180,618 mt, with about one-third of the volume destined for China. China is outbidding Russia and other markets for Uruguayan beef, recording large growth in the following categories: frozen bone-in (10,603 mt, +1012%), frozen boneless (29,905 mt, +538%) and offals (8,571 mt, +331%).

Uruguay’s frozen export volume was up 5 percent to 128,135 mt, though the per-unit value was down 4 percent to $4,820/mt. Chilled volume was up 12 percent to 23,186 mt, with a steady per-unit value of $9,276/mt.

Uruguay’s exports to the EU were up 2 percent to 25,165 mt, with a 17 percent decline in frozen volume (13,578 mt) offset by a 40 percent increase for chilled (11,587 mt), reflecting larger shipments under the duty-free, grain-fed quota. Uruguay was also able to export chilled beef at lower prices, with unit values for the EU down 9 percent from last year to $10,636/mt. Exports were also larger to Brazil, the United States and Canada.

Uruguay’s cattle slaughter is up 3.3 percent from last year, but seasonally tighter supplies have begun to elevate prices and slow export volumes.

Sources: World Beef Report and Uruguay’s National Meat Institute