1. Sponsored by
Vol. 11, No. 63 / April 4, 2013
In one of those “Well, duh.” moments, we managed to U.S. PORK EXPORTS BY COUNTRY,
omit one critical factor from our list of issues that have been im-
pacted pork and beef prices this spring — export challenges. And ANNUAL
the challenges are indeed serious and involve two important markets, 600
Japan
Russia and China, and concerns over residues of ractopamine, a beta
Canada
agonist used in pork, beef and turkey production. The product is sold 500 Mexico
under the trade name Paylean for pigs and Optiflexx for cattle. South Korea
Russia and China play different roles in the two sectors. As 400 China
can be seen in the charts at right and on page 2, China is a major mar- T Russia
M
ket for both pork and pork variety meats but has long had in place a de d Hong Kong
n
facto ban on U.S. beef and beef variety meat products. China was the a 300 Australia
s
u
third largest destination for pork exports in 2011 and the fourth largest in o
h Taiwan
T
2012. Adding Hong Kong to those totals would leave China the number 200
three destination in both years. But China has quickly risen to the num-
ber two ranking among markets for pork variety meats and is our top
100
customer if Hong Kong is included. China is now the clear leader in the
value of pork variety meat exports. The United States Export Federa-
tion estimates that pork and pork variety meat exports to China account 0
9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2
for roughly $7 and $4.75, respectively, per head of U.S. hogs. 8
9
9
9
9
9
9
9
9
9
9
9
9
9
9
9
9
9
9
9
9
9
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
0
1
0
1
0
1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 2 2 2 2
Russia, is a smaller but important customer for both species,
ranking as high as fourth on our pork customer list in 2008 and growing U.S. BEEF EXPORTS BY COUNTRY,
to be our sixth largest beef customer in 2012. Russia has consistently
been the second largest destination for U.S. beef variety meat exports ANNUAL
since 2007. USMEF estimates that the impact of losing Russian mar- 400
Canada Japan
ket for beef and pork products would be $800 million or $15/head of Mexico Korea, South
350
cattle and $4/head of hogs. Hong Kong Russia
Vietnam China
Russia notified U.S. officials in December that they would be 300
required to certify that products were free of ractopamine residues.
Russia then closed its markets when the U.S. government did not start T 250
M
a program to meet those demands. d
n
a 200
China has demanded that U.S. product be certified to be racto- s
u
o
pamine free but the exact “certification” requirements are still in doubt. h
T 150
U.S. packers with whom we have talked are concerned that
“certification” will not be sufficient to meet China’s demand since the 100
product may be tested when it arrives, implying that all product must be
ractopamine free. Our sources indicate that it is virtually impossible to 50
prevent cross contamination in a plant — especially with testing meth-
ods allowing detection at the parts per trillion level. This means that 0
9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2
segregation of ractopamine-fed and ractopamine-free animals may not 8 9 9 9 9 9 9 9 9 9 9 0 0 0 0 0 0 0 0 0 0 1 1 1
9 9 9 9 9 9 9 9 9 9 9 0 0 0 0 0 0 0 0 0 0 0 0 0
1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 2 2 2 2
be possible. It is our impression that to avoid potential problems, all
animals in a plant will have to be ractopamine free. Those positions do not necessarily fit together but they do, it seems,
How will the situation be rectified? There is no easy answer to address the realities of today’s international trade environment. China
that question. USMEF’s March statement on the situation said: and Russia are not the only countries that have trade restrictions that do
“Russia’s ban on residues . .. brings into clear focus the dilemma that not agree with internationally-accepted scientific standards. The EU is
arises when our support for science-based trade and meeting the notorious for adopting additional trade restrictions. Taiwan has banned
demand of our customers collide with a foreign country’s non-science U.S. exports over ractopamine for several years. Working toward sci-
-based import requirements. . . . The industry has encouraged our ence-based standards is well and good but recognizing the desires of
government to press Russia to adopt a science-based standard for our customers still seems like good business — so long as those cus-
beta agonists. At the same time, we also asked USDA to develop a tomers are made to pay all of the costs of their preferences. It remains
program to certify residue-free exports.” to be seen whether that will be the case for U.S. beef and pork.
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2. Sponsored by
Vol. 11, No. 63 / April 4, 2013
U.S. PORK VARIETY MEAT EXPORTS,
ANNUAL
180
Japan
160 Canada
Mexico
140
South Korea
120 China
T Russia
M
100
d Hong Kong
n
a Australia
s
u 80
o Taiwan
h
T
60
40
20
0
9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2
8 9 9 9 9 9 9 9 9 9 9 0 0 0 0 0 0 0 0 0 0 1 1 1
9 9 9 9 9 9 9 9 9 9 9 0 0 0 0 0 0 0 0 0 0 0 0 0
1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 2 2 2 2
U.S. BEEF VARIETY MEAT EXPORTS, BY
COUNTRY
200000
180000
160000
140000 Canada
T Japan
M120000
d Mexico
n
a100000
s Korea, South
u
o Hong Kong
h 80000
T
Russia
60000 Vietnam
40000 China
20000
0
9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2
8 9 9 9 9 9 9 9 9 9 9 0 0 0 0 0 0 0 0 0 0 1 1 1
9 9 9 9 9 9 9 9 9 9 9 0 0 0 0 0 0 0 0 0 0 0 0 0
1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 2 2 2 2