By Macey Mueller Contributing Editor
Continued strong beef demand in Japan, South Korea and China combined with efforts to expand and diversify international markets have led to record beef export volume and value in 2022, said U.S. Meat Export Federation (USMEF) President and Chief Executive Officer Dan Halstrom during the Kansas Livestock Association (KLA) Annual Convention this past December.
Although final 2022 trade data won’t be released until later this spring, Halstrom said the United States was on track to see a 4 percent increase over the 2021 export volume. On a per-fed-head basis, he said the total value of 2022 exports was $465 per head. Add in the hide and rendered products and the value exceeds $500 per head.
“Without the export markets, you would see a void of $500 per head, and if you don’t believe me, look back to the BSE case in December 2003 when so many of the export markets disappeared and export value was closer to $180 head,” he said.
While many global consumers enjoy more traditional muscle cuts like short plates and chuck rolls, USMEF has been focused on promoting underutilized cuts like the flank, chuck tender and, most recently, the knuckle, which comes from the round.
“The round is the most underutilized primal in the beef complex,” Halstrom said. “As we go into a time with lower production due to the cow liquidation the past two years, this is the time to use some of the different cuts, and we are gaining traction with the knuckle.”
Since many popular muscle cuts are actually worth more domestically, the nearly 90 USMEF staff members located around the world have also worked to build and expand markets for variety meats, including tongue, heart, liver, tripe, etc.
For example, beef tongue going to Japan is valued at $10 per pound wholesale – or $20 per head – where it would be closer to $1 per pound in the United States. Additionally, key markets for beef liver like Egypt, Morocco, Peru and South Africa are willing to pay $0.80-$0.85 per pound when it was once just a rendered product.
“It’s really about selling the whole carcass and putting the right cuts in the right markets to maximize the value,” Halstrom said. “At the same time, we are trying to diversify to as many countries as possible to avoid overly relying on any one market.”
USMEF has recently been successful in helping to create emerging and expanded markets for beef in areas like Columbia, Central America, the Caribbean and even Africa.
In the past 10 years, U.S. beef exports have increased sixfold in Columbia and have more than doubled in Central America – two countries where Halstrom said pork has traditionally been the protein of choice.
“As they become more familiar with U.S. production practices and they want more options, the logical growth pattern is to show them beef, and now we’ve seen significant growth in the past few years, even as prices go up,” he said. “If we can get customers in these markets to talk about safety, quality, eating experience and value-added programs first and price later, we’ve won.”
With continued supply chain issues, a strong American dollar and COVID restrictions still in place across areas of Asia, Halstrom said 2022 was anything but easy. While export containers are now easier to source than earlier last year, freight rates have stabilized but at much higher rates. Additionally, the U.S. dollar saw immense strength through most of 2022, which made local currency weaker and the price of beef higher. The Japanese yen and the South Korean won devalued by as much as 35 percent in September 2022.
Despite the historically rocky road with China since BSE in 2003, Halstrom said beef exports have seen amazing growth due to access provisions in the U.S.-China “Phase One” agreement signed in January 2020, with $1.6 billion in beef sold to China in 2021 and more than $2 billion in 2022.
Halstrom reminded KLA members that it has taken years to develop many of these successful markets around the world with the help of funding from the Beef Checkoff and Pork Checkoff, leveraged with matching federal dollars.
“It really starts with you folks here in the room who pay into the Beef Checkoff,” he said. “In the face of higher prices and lower production in the U.S. going into 2023, the demand for our products is as good as I’ve ever seen it.”