During my 30-plus years as a professional in the pork industry, I have always been interested in the import/export picture for U.S. pork. Over half of that period of time, we have seen an exciting incline in U.S. exports, to the point where for every 3.3 pounds of pork traded globally, one pound comes from the United States. That is remarkable! At our recent PORK 101 conducted by Iowa State University Meat Scientists, Dr. Ken Prusa covered a lot of U.S. Meat Export Federation (USMEF) data with the group. He started out by saying that when we were a net importer in 1986, the value of exports was $1.97 per pig. In 2008, it was $42.81 per pig.
We export about 22.5 percent of our total production of pork and variety meats. There are over 25 countries that import pork and pork products from the United States and they paid $4.3 billion for that product last year. Of course, one caution that we often hear about concerns our vulnerability and the risk we face with this exposure. The export market can be very fickle, as we saw with the H1N1 fiasco last year. While it was quickly shown that there was no need for concern from the standpoint of pork consumption, many countries use political reasons for their trade decisions. This risk could be greatly magnified in the years ahead. Speaking at the recent National Pork Forum, Phil Seng of USMEF said that China should be opening up soon. Dermot Hayes at Iowa State University stated that if the China market was fully opened, China could take up to 50 percent of U.S. pork production.
Last year, U.S. producers fulfilled 46 percent of the market needs of Japan imports, which represented 72 percnet of the chilled pork. This equated to $1.54 billion. The Japanese have developed a system. They know what they want and they know how to get it. They have trained U.S. plant quality control staff in their grading needs. They select on size, weight, color, marbling, firmness, and even pH in some cases. They want sturdy boxes that are labeled a certain way. The product must be high quality with no bruises or blood splash and it must have a long shelf-life which means our packers must use nearly sterile techniques. They must keep it very cold without freezing, and they must keep it moving.
To achieve this dominance in pork exports, we quickly learned years ago that we needed to provide the product that was wanted by importing countries and that there was a premium price available for this product. That is why we send the best U.S. pork overseas. When I shared this information to some U.S. retailers a couple of years ago, they were indignant and asked how they could get this product. I told them it was a simple matter of dollars and cents and that being price buyers, they were not likely to compete for that market. I have noticed of late, though, that some retailers are willing to pay a premium to get these premium products for their customers. The other answer to this is for our production industry to collectively raise a uniform, high quality product, but with all the other economic drivers influencing pork producer decisions, this becomes more difficult.
The potential for U.S. pork in the global market is great. It becomes even larger as more developing countries become financially stable and an improved standard of living allows residents to consume more meat products. While there is certainly an identified risk associated with this exposure, it is not an unmanageable risk. This move to ever-increasing exports and a bigger share of our production leaving our shores must be accompanied by a plan for protection against swine health issues, food safety concerns, zoological diseases, and trade barriers. A well thought through strategic plan must accompany any increase in our market share. It will be fun to watch what the future brings our industry in terms of global trade.
During my 30-plus years as a professional in the pork industry, I have always been interested in the import/export picture for U.S. pork. Over half of that period of time, we have seen an exciting incline in U.S. exports, to the point where for every 3.3 pounds of pork traded globally, one pound comes from the United States. That is remarkable! At our recent PORK 101 conducted by Iowa State University Meat Scientists, Dr. Ken Prusa covered a lot of U.S. Meat Export Federation (USMEF) data with the group. He started out by saying that when we were a net importer in 1986, the value of exports was $1.97 per pig. In 2008, it was $42.81 per pig.
We export about 22.5 percent of our total production of pork and variety meats. There are over 25 countries that import pork and pork products from the United States and they paid $4.3 billion for that product last year. Of course, one caution that we often hear about concerns our vulnerability and the risk we face with this exposure. The export market can be very fickle, as we saw with the H1N1 fiasco last year. While it was quickly shown that there was no need for concern from the standpoint of pork consumption, many countries use political reasons for their trade decisions. This risk could be greatly magnified in the years ahead. Speaking at the recent National Pork Forum, Phil Seng of USMEF said that China should be opening up soon. Dermot Hayes at Iowa State University stated that if the China market was fully opened, China could take up to 50 percent of U.S. pork production.
Last year, U.S. producers fulfilled 46 percent of the market needs of Japan imports, which represented 72 percnet of the chilled pork. This equated to $1.54 billion. The Japanese have developed a system. They know what they want and they know how to get it. They have trained U.S. plant quality control staff in their grading needs. They select on size, weight, color, marbling, firmness, and even pH in some cases. They want sturdy boxes that are labeled a certain way. The product must be high quality with no bruises or blood splash and it must have a long shelf-life which means our packers must use nearly sterile techniques. They must keep it very cold without freezing, and they must keep it moving.
To achieve this dominance in pork exports, we quickly learned years ago that we needed to provide the product that was wanted by importing countries and that there was a premium price available for this product. That is why we send the best U.S. pork overseas. When I shared this information to some U.S. retailers a couple of years ago, they were indignant and asked how they could get this product. I told them it was a simple matter of dollars and cents and that being price buyers, they were not likely to compete for that market. I have noticed of late, though, that some retailers are willing to pay a premium to get these premium products for their customers. The other answer to this is for our production industry to collectively raise a uniform, high quality product, but with all the other economic drivers influencing pork producer decisions, this becomes more difficult.
The potential for U.S. pork in the global market is great. It becomes even larger as more developing countries become financially stable and an improved standard of living allows residents to consume more meat products. While there is certainly an identified risk associated with this exposure, it is not an unmanageable risk. This move to ever-increasing exports and a bigger share of our production leaving our shores must be accompanied by a plan for protection against swine health issues, food safety concerns, zoological diseases, and trade barriers. A well thought through strategic plan must accompany any increase in our market share. It will be fun to watch what the future brings our industry in terms of global trade.
Editor’s Note: Dr. Meisinger is the Executive Director of the U.S. Pork Center of Excellence. To contact Dr. Meisinger, e-mail him at: drdave@iastate.edu or call him by phone at: (515) 975-3557.
This commentary is for informational purposes only. The opinions and comments expressed herein represent the opinions of the author--they do not necessarily reflect the opinion of Farms.com. This commentary is not intended to provide individual advice to anyone. Farms.com will not be liable for any errors or omissions in the information, or for any damages or losses in any way related to this commentary. Dr. Meisinger is the Executive Director of the U.S. Pork Center of Excellence. To contact Dr. Meisinger, e-mail him at: drdave@iastate.edu or call him by phone at: (515) 975-3557.
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This commentary is for informational purposes only. The opinions and comments expressed herein represent the opinions of the author--they do not necessarily reflect the opinion of Farms.com. This commentary is not intended to provide individual advice to anyone. Farms.com will not be liable for any errors or omissions in the information, or for any damages or losses in any way related to this commentary.