US exports value still under pressure

August pork export volume was down 1% from last year at 182,372 t, while export value fell 3% to $494.1 mill. Pork muscle cuts fared better in August, increasing 5% to 148,736 t, but value still declined 1% to $414.7 mill. Pork variety meat exports declined sharply in August in both volume (33,636 t, down 20%) and value ($79.4 mill., down 15%).

For January through August, combined pork and pork variety meat exports remained 1% ahead of last year’s record pace at 1.63 mill. t, while value increased 3% to $4.32 bn. For pork muscle cuts only, exports increased 6% from a year ago in volume (1.31 mill. t) and 4% in value ($3.58 bn).

August exports accounted for 21.9% of total pork production, down from 23.1% a year ago, while the percentage of muscle cuts exported held steady at 19.2%. For January through August, exports equaled 26.3% of total pork production (down from 26.9% a year ago), while the percentage of muscle cuts exported was 22.8% (up from 22.4%). Pork export value averaged $44.29 per head slaughtered in August, down 8% from a year ago, while the January-August per-head average dropped 1% to $53.28.

US pork currently faces retaliatory duties in two markets: China and Mexico. China’s duty rate on pork muscle cuts and variety meat increased from 12 to 37% in April and from 37 to 62% in July. Mexico’s duty rate on pork muscle cuts increased from zero to 10% in June and jumped to 20% in July (pork variety meats continue to enter Mexico duty-free). Beginning in June, Mexico also imposed a 15% duty on sausages and a 20% duty on some prepared or preserved hams and shoulders.

August pork exports to leading value market Japan increased 10% from a year ago to 34,935 t, valued at $146.8 mill. (up 5% and the highest of 2018). For January through August, exports were up 2% from a year ago in both volume (265,250 t) and value ($1.1 bn.). Pork exports to Korea continued to surge in August, increasing 39% in volume to 11,303 t and 40% in value to $31.3 mill. This pushed January-August exports to 159,536 t (up 43%) valued at $455.6 mill. (up 49%). Exports of pork variety meat, including bungs and feet, have contributed significantly to this growth. Through August, pork variety meat exports to Korea increased 84% from a year ago in volume (10,358 t) and more than doubled in value to $32.4 mill. (up 111%). Most US pork products enter Korea duty-free, and this will continue under the revised KORUS agreement.

August pork exports to leading volume market Mexico fell 4% from a year ago to 62,319 t, while value dropped 21% to $103 mill. Through August, exports to Mexico remained 2% ahead of last year’s record pace at 532,034 t, but value declined 6% to $921.1 mill. August exports to the China/Hong Kong region fell 43% from a year ago to 19,732 t, with value dropping 32% to $52.9 mill. For January through August, exports were down 24% in volume (257,939 t) and fell 13% in value to $615.9 mill.

January-August highlights for US pork exports include:

• Led by strong growth in Colombia and Peru, exports to South America increased 29% from a year ago in volume (82,153 t) and 24% in value ($204.4 mill.). A slow start to the year kept exports to Chile below last year’s record volume pace, but shipments regained momentum in July and August.
• Following a record performance in 2017, pork exports to Central America surged 20% higher in volume (52,528 t) and increased 17% in value ($123.8 mill.). Pork exports to all seven Central American nations have achieved double-digit growth in 2018.
• Exports to the Dominican Republic continue to gain momentum, increasing 30% in volume (29,480 t) and 25% in value ($64.5 mill.).
• Led by strong growth in the Philippines and Vietnam, exports to the ASEAN region increased 29% in volume (39,021 t) and 28% in value ($100.1 mill.). The ASEAN is an especially important destination for pork variety meat, with these exports nearly doubling from a year ago in both volume (14,273 t, up 99%) and value ($24.2 mill, up 94%).
• Exports to Australia were 9% ahead of last year’s record pace in both volume (51,070 t) and value ($147.5 mill.). Australia is the third-largest destination for US hams exported for further processing, trailing only Mexico and China/Hong Kong.