by Conley Nelson
I am offering the following report on the Nov. 6 meeting of the USMEF Pork and Allied Industries Committee on behalf of Chairman Sam Carney, who was unable to attend.
Despite high U.S. pork prices, tight supplies and a strong U.S. dollar, U.S. pork exports have performed well in 2014. The committee focused on the ability for pork supplies (U.S., domestic and other imported pork) to satisfy growing demand and the degree to which market access barriers in certain markets have shifted pork trade patterns around the world.
USMEF staff from South Korea, China and Central America provided an overview of their respective markets. In Korea, PEDV has reduced total hog inventory 2.2 percent, pork production is down 2.8 percent and domestic prices are 45 percent higher than a year ago. U.S. pork exports to Korea have grown sevenfold over the past 10 years, which has opened the door for increased U.S. pork penetration in Korea – especially for chilled product. Through September of this year, pork/pork variety meat exports to Korea totaled 96,667 metric tons (mt) valued at $304.5 million – up 37 percent in volume and 56 percent in value compared to the same period in 2013.
In China, U.S. pork is facing greater headwinds with a large domestic supply driving prices down. However, our product still continues to make significant inroads in China’s retail sector. A major highlight in China is the rapidly evolving e-commerce segment, which is showing triple-digit growth.
USMEF’s educational efforts in Central America have led to deeper penetration for U.S. pork, which is now available at major international chains in the region (such as Walmart) as well as local supermarket chains.
Russia’s closure to most U.S., Canadian and EU pork has created a major competitive challenge in the form of a glut of inexpensive EU pork. Looking to offset the more than 300,000 metric tons normally destined for Russia, the EU is now aggressively targeting Asia. Although demand for U.S. pork has held up well in many of these markets, the year-over-year increases for EU pork exports are significant. Here are some examples (data is from January through September):
- Japan: up 51 percent to 276,201mt
- Korea: up 81 percent to 145,033 mt
- Philippines: up 88 percent to 121,107 mt
- Taiwan: up 255 percent to 30,189 mt
- Singapore: up 42 percent to 26,420 mt
- Thailand: up 40 percent to 23,750 mt
- Vietnam: up 522 percent to 10,613 mt
The meeting included a very informative panel discussion on the global pork outlook for the upcoming year with USMEF Economist Erin Borror, Dr. Dermot Hayes of Iowa State University and Brett Stuart of Global AgriTrends.
USMEF presented the Strategic Marketing Plan to the committee along with its Fiscal Year 2015 funding request. The committee moved to approve the funding as a guideline, pending National Pork Board approval.
The committee also received an update on the National Pork Board’s 2020 Strategic Plan from Chief Operating Officer John Johnson, who explained the goals included within the plan and criteria that will be used to evaluate progress toward those goals. More details on the plan are available from the National Pork Board website.
Nick Giordano, vice president and counsel for international affairs for the National Pork Producers Council, provided a pork trade access update, with a particular focus on the Trans-Pacific Partnership (TPP) negotiations. He emphasized the importance of demanding full access to the Japanese market for U.S. pork, noting that the concessions Japan is seeking are not consistent with the standards the United States should require in a 21st century trade agreement. Giordano also provided an update on the recent WTO ruling on country-of-origin labeling, which is likely to be appealed.
If you have questions or would like additional information about the Pork and Allied Industries Committee meeting, please email John Hinners or call 303-623-6328.
Note: The Exporter Committee report was in last week’s Export Newsline.