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Angus Productions Inc.
Copyright © 2009
Angus Productions Inc.

A Look at Global Trade


PHOENIX, Ariz. (Jan. 29, 2009) — The recent credit freeze has dealt a major blow to U.S. exports, Cattle-Fax analyst Brett Stuart told attendees of the Cattle-Fax Outlook session Thursday, Jan. 29, during the 2009 Cattle Industry Annual Convention in Phoenix, Ariz.


Brett StuartBrett Stuart“We are in a payment versus delivery standstill,” Stuart said, addressing attendees about global trade issues. “Foreign markets wanting U.S. beef are unwilling to pay without having the product in hand, while we are uneasy about sending it to them without payment.”


However, U.S. beef remains very competitively priced in key markets.


“Beef exports were up 24% to 459 million pounds (lb.),” Stuart said. “The biggest difference is having full access to South Korea again.” Exports to South Korea average about 9.4 million lb. of beef per week. Stuart says Cattle-Fax predicts a total of 468 million lb. to be purchased in 2009.


Exports to Canada and Mexico have been a critical factor in maintaining a positive trade outlook.


“We’ve experienced some trade friction with Canada and Mexico, highly due to mandatory COOL (country-of-origin labeling) compliancy,” Stuart said. “Canada and Mexico represent 53% of U.S. beef exports, adding $50 to $60 per head in total value.”


Access to foreign markets remains a key proposition for beef cattle markets. Japan continues to limit U.S. beef shipments to beef harvested from animals less than 21 months of age, and currently China is closed.


“If we can get Japan to open markets to 30 months of age we could restore 95% of our pre-BSE (bovine spongiform encephalopathy) numbers,” Stuart said. “This means an added $4 per hundredweight (cwt.) on a live basis very quickly to U.S. markets.”

Editor’s Note: This article was written under contract or by staff of Angus Productions Inc. (API), which claims copyright to this article. It may not be published or distributed without the express permission of Angus Productions Inc. To request reprint permission and guidelines, contact Shauna Rose Hermel, editor, at (816) 383-5270.