Declining US beef production drives imports over $2.6 billion
US beef production is declining and resulting in higher beef imports according to Eoin Kelly, Business Analyst at Bord Bia.
Citing figures from the latest United States Department of Agriculture Livestock, Dairy, and Poultry Outlook report published in October 2014 Kelly says beef production is set to decline by 5% this year, with some further decline next year.
However, he also says lower feed prices and increased dressed weights, compared to their 2013 equivalent, have offset the overall decline in production somewhat.
“Favourable weather conditions have been persistent for most parts of the country, which is increasing the potential for the expansion of the suckler herd. With lower throughput of cows at processors, this highlights an early indication of herd rebuilding over the next few years,” he said.
Kelly says with domestic production declining stronger prices in the US are expected to lead to an increase in feeder cattle imports from Canada and Mexico.
He says tight domestic supplies this year have led to a 12% increase in feeder cattle imports from Canada and a 14% increase from Mexico for the first three quarters of 2014. Feeder cattle imports are forecast to reach 2.2 million head by the end of the year, with a further increase expected moving into next year.
According to Kelly the overall forecast for U.S. beef imports in 2014 indicates an increase of around 19% to reach 2.684 billion pounds by the end of the year.
He says import demand is expected to remain strong moving into next year, with a further increase in imports forecast.
Kelly says imports for the first three quarters of this year have increased from Australia, New Zealand, Mexico and Canada, with favourable exchange rates increasing the Canadian trade. He says Australian imports in particular have increased 50%, which accounts for more than two thirds of the total increase in imports.