The United States is forecast to export 1.846 billion pounds of beef in 2009, a 2- percent decline from last year, but an improvement from the outlook earlier in 2009. Through October, year-to-date U.S. beef exports are more than 5 percent below 2009. However, strong sales to Japan, Hong Kong, Vietnam, and Taiwan, as well as improving sales to South Korea, have helped buoy exports against declines in the two largest export markets, Canada and Mexico. In 2010, beef exports are expected to increase almost 8 percent, as a weak U.S. dollar will make U.S. beef relatively less expensive in the recovering global economy.
U.S. beef imports this year are expected to be 2.703 billion pounds, a 6.5-percent increase from 2008. The strong U.S. dollar earlier in the year, combined with weak economic conditions in competing markets, resulted in large quantities of beef imports from Australia. However, imports have declined as the weakened dollar has made foreign beef relatively more expensive. In 2010, U.S. beef imports are expected to increase 3 percent.
Live Cattle Imports from Mexico Improve in Fourth Quarter
The United States is expected to import 1.9 million head of cattle in 2009, a 17- percent decrease from last year. Canada and Mexico, the two significant foreign markets for live cattle, have different outlooks. Good weather conditions this summer and fall that kept cattle in Mexico have led to an increase in imports in recent weeks, as conditions are now becoming drier. In contrast, U.S. imports from Canada have been much lower than in the past few years, as lower beef demand in the United States and a stronger Canadian dollar have taken away the higher potential returns for Canadian producers marketing in the United States. According to weekly AMS reports, U.S. live cattle imports from Mexico have been
strengthening since early November. Most Mexican cattle are imported into the United States in the fourth quarter as pasture in Mexico begins to deteriorate seasonally, and are marketed to U.S. stocker operations and feedlots. After morethan- adequate rainfall in late summer and early fall in Mexico, drier conditions in November likely initiated the increase of Mexican cattle entering the U.S. market. Through October, year-to-date imports are 40 percent higher than 2008, which was an exceptionally low year due to unusually good weather conditions in Mexico. Year-to-date imports are 19 percent lower than 2007 imports, which is a more comparable year in terms of weather conditions.
In 2009, the United States has seen fewer cattle imported from Canada, relative to the past couple of years. Through October, year-to-date imports are 35 percent lower than 2008. Decreased demand for beef in the United States and a relatively strong Canadian dollar have led to smaller returns for Canadian producers considering marketing their feeder or fed cattle in the United States. Typically, stronger demand for cattle in the United States and a better return with a stronger U.S. dollar provide incentives for Canadian producers to market in the United States. According to weekly AMS reports, the price difference between Canadian and U.S. markets—in U.S. dollar terms—is the smallest in 3 years.