Poultry Industry News, Comments & More

U.S. Meat Exports

01/09/2021

U.S. Broiler and Turkey Exports for January-November 2020.

 

Total exports of broiler parts in January-November 2020 attained 3,279,259 metric tons, 5.0 percent more than in January-November 2019 (3,121,870 metric tons). Total value of exports increased by 2.8 percent to $3,263 million ($3,173 million Jan.-November 2019).

 

Unit price is constrained by the fact that leg quarters comprise over 96 percent of exports except feet. Leg quarters represent a relatively low-value commodity lacking in pricing power. Exporters of commodities are subjected to competition from domestic production in importing nations. Generic products such as leg quarters are vulnerable to trade disputes and embargos based on real or contrived disease restrictions.

 

The extensive outbreak of African swine fever has boosted U.S. exports to Asia over the intermediate-term. All animal protein will rise in price as pork supply is restricted or reversed as supply is restored. The effect of increased demand from Viet Nam is apparent but disruption in ports and transport infrastructure due to the COVID-19 outbreak impacted exports to China during January and February.

 

During January-November 2020 the National Chicken Council (NCC), citing USDA-FAS data, documented exports of 3,323,194 metric tons of chicken parts and other forms (whole and prepared) valued at $3,344 million with a weighted average unit value of $1,006 per metric ton, 2.5 percent lower in unit value than in January-November 2019 ($1,032 per metric ton).

 

The NCC breakdown of chicken exports during January-November 2020 by proportion and unit price for each broiler category compared with January-November 2019 (with the unit price in parentheses) comprised:-

  • Chicken parts 6%; Unit value $959 per metric ton ($972)
  • Prepared chicken 1%; Unit value $3,525 per metric ton ($3,592)
  • Whole chicken 3%; Unit value $1,008 per metric ton ($1,044) 

 

Direct comparisons between 2019 and 2020 are confounded by the USDA combining export quantities of feet with chicken meat from April onwards.

 

The following table prepared from USDA data circulated by the USAPEEC, compares values for poultry meat exports for January-November 2019 with the corresponding months in 2020:-

PRODUCT

JAN.- NOV. 2019

JAN.- NOV. 2020

DIFFERENCE

Broiler Meat & Feet

Volume (metric tons)

3,121,870

3,279,259*

+157,389 (+5.0%)

Value ($ millions)

3,173

3,263*

+90 (+2.8%)

Unit value ($/m. ton)

1,016

995*

-21 (-2.1%)

Turkey Meat

Volume (metric tons)

269,033

238,130

-30,903 (-11.5%)

Value ($ millions)

626

536

-90 (-14.4%)

Unit value ($/m. ton)

2,326

2,251

-75 (-3.2%)

Chicken Paws

JAN-MARCH 2019

Volume (metric tons)

39,358

Not disclosed

Value ($ millions)

48

Not disclosed

Unit value ($/m. ton)

1,219

Not disclosed

*See note concerning inclusion of feet in totals from April onwards as in text above

 

COMPARISON OF U.S. CHICKEN EXPORT DATA FOR JANUARY-NOVEMBER 2020 COMPARED TO CORRESPONDING MONTHS IN 2019

EXPORTS OF CHICKEN PARTS AND FEET, JANUARY-NOVEMBER 2020

 

Total broiler parts, predominantly leg quarters but including feet, exported during the first eleven months of 2020 as compared with 2019 increased by 5.0 percent in volume and 2.8 percent in value. Unit value was 2.1 percent lower at $995 per metric ton.

 

The fluctuation in value of the U.S. Dollar relative to the currencies of Brazil, Argentina and Thailand adversely impacted competitiveness in 2020 through May. Notwithstanding these restraints, volume and value were higher during the first eleven months of 2020 compared to 2019. The uncontrolled outbreak of African swine fever in China and Southeast Asia from early 2019 onwards coupled with disruptions in chicken production during January and February 2020 associated with COVID-19, increased demand for protein with international repercussions on trade in chicken and pork. These trend are reversing with implications for 2021.

 

The top five importers of broiler meat represented 49.4 percent of shipments during January-November 2020. The top ten importers comprised 65.0 percent of the total volume reflecting greater concentration among the top importers.

 

Mexico was the largest importer of broiler meat from the U.S. by volume and value during January-November 2020 with a volume of 633,608 metric tons representing 19.3 percent of volume and 15.8 percent of total value at a unit price of $815 per metric ton. During November 2020 exports to Mexico were higher by 11.0 percent in volume and 6.8 percent in value compared to November 2019 with unit value attaining $783 per metric ton.

 

China was ranked 2nd by volume but highest in value among importers of broiler parts and feet combined, over the period February through November 2020. China represented 14.2 percent of export volume and 20.3 percent of value at a unit price of $1,429 per ton indicating a high proportion of feet shipped. China was the leading importer in November based on value representing 20.0 percent of total product shipped and 28.1 percent of value at a unit price of $1,385 per metric ton.

 

The average unit price of broiler products excluding purchases by China during the first half of 2020 was $960 per ton. Given a unit price of $1,551 for feet shipped to Hong Kong during the first quarter of 2020 it is concluded that a high proportion of shipments to China over past months comprised feet. The relative volume of shipments of feet to Hong Kong and China during March and April reflect that about half the consigned feet to Hong Kong prior to March 2020 were trans-shipped to Mainland China. Based on frozen stock levels it is apparent that export of chicken meat to China is taking place with leg quarters down 36.0 percent between November 2019 and 2020 to a level of 62.8 million lbs. Inventory was down 17.0 percent in November 2020 compared to the previous month. The NCC circulated data in early January 2021 released by the General Administration of Customs of the Government of the PRC, indicating imports of 52,500 metric tons of “broiler meat” from the U.S. in November 2020. This implies that feet represented 11,335 metric tons given the USDA-USAPEEC combined value for meat and feet of 63,835 metric tons. The NCC breakdown of U.S. chicken exports comprised 41 percent paws, 53 percent bone in (presumably leg quarters) and the remainder as offal and wings. Obviously data from the PRC and from the USDA do nor correspond.

 

Taiwan was the 3rd ranked importer during January-November 2020 with 6.9 percent of U.S. export volume and 6.3 percent of value attributed to the product mix with a unit price of $920 per metric ton suggesting leg quarters as the principal product. During November Taiwan ranked 4th among importers with 5.4 percent of volume and 4.5 percent of value.

 

Cuba was 4th in rank over January-November 2020 with 4.8 percent of volume and 4.0 percent of value. Shipments were 27.4 percent lower than in January-November 2019. Volume increased by a substantial 50.2 percent in November to 12,227 metric tons (15,563 metric tons in October) valued at $11.3 million. It is hoped that this trade worth $191 million in 2019 and $130 million over the first eleven months of 2020 will not be compromised by injudicious diplomatic activity or politically inspired restraints such as enforcement of the Helms-Burton Act or extreme restrictions on travel or remittances to families. This market is courted by both Brazil and Argentina. Cuba has lost financial support from Venezuela in addition to collapse of tourism due to COVID-19, reducing availability of foreign currency.

 

Viet Nam was the 5th ranked broiler meat importer during January-November 2020 receiving 143,232 metric tons representing 4.4 percent of volume and 3.7 percent of value with a unit price of $838 per ton. Viet Nam increased volume of purchases by 1.1 percent over January-November 2020 compared to 2019. Shipments are expected to progressively increase due to reduced availability of pork attributed to an extensive and currently uncontrolled outbreak of African swine fever. In late January and during early February some shipments of chicken were diverted to Viet Nam as a result of port congestion in China arising from the COVID-19 shutdown. During November Viet Nam was 13th in rank among importers down 64.6 percent in volume and 62.2 percent in value compared to November 2019.

 

Canada maintained 6th rank among importers over the past eleven months attaining 4.2 percent of volume and 8.2 percent of value with a unit value of $1,920 indicating added-value product. In November 2020 volume increased by 4.2 percent over November 2019 but total value declined 0.5 percent with a unit value of $1,960.

 

There is constant fluctuation among the ten, second-tier nations importing broiler meat with average monthly volumes ranging from 3,000 to 8,000 metric tons. Expanding volume is due to the promotional activities of USAPEEC and their regional representatives interacting with traders.

 

During November 2020 nations gaining in volume compared to the corresponding month in 2019 (with the percentage change indicated) in descending order of volume were:- Mexico (+11.0%); Angola (+21.1%); Taiwan (2.5%); Guatemala (+16.0%); (+Cuba, (+50.2%) and Haiti (141.7%)

 

November gains were offset by losses in exports to Columbia (-30.3); Philippines (-53.9); Vietnam (-64.6%); South Africa (-32.8%); Iraq (-68.8%) and Hong Kong (-87.2%)

 

EXPORTS OF TURKEY PRODUCTS

The volume of turkey meat exported during January-November 2020 declined by 11.5 percent and value fell by 14.4 percent compared to January-November 2019 with an average unit value decrease of 3.2 percent from $2,326 per metric ton during the first eleven months of 2019 to $2,251 per metric ton in January-November 2020.

 

Mexico, the leading importer received 60.2 percent of turkey meat shipped during January-November 2020, 6.5 percent less than during the first eleven months of 2019. Exports to Mexico amounting to $343.9 million at a unit price of $2,271 represented 64.2 percent of the total value of $535.7 million shipped. During November 2020 imports from the U.S. were down 2.9 percent in volume and 14.6 percent in value compared to November 2019 reflecting decreased demand associated with COVID but with a fractionally higher average unit value of $2,215.

 

China continued as a distant second-ranked importer with 16,336 metric tons imported over February-November comprising 6.9 percent of volume and 5.1 percent of value for the ten trading months with a unit value of $1,659, confirming shipment of a low-value product mix. Exports were constrained by COVID-19 disruption during the review period but this market represents potential for U.S. turkey producers.

 

Canada was the third-ranked importer during the first eleven months of 2020 with 2.2 percent of volume and 3.7 percent of total value at a high unit price of $3,732 per metric ton.

 

South Africa, ranked 6th during January-November 2020, imported 4,207 metric tons at a unit value of $1,236 per ton. Tariffs were not raised on imported turkey meat in comparison to broiler meat. Volume and value were down 54.5 percent and 57.0 percent respectively compared with January-November 2019 possibly relating to the unfavorable exchange rate of the SARand relative to the U.S. Dollar (Approximately SAR 16.5=US$ November). Imports by South Africa from the U.S. in November were not listed among the top six nations.

 

During the first quarter of 2020 the U.S. concluded a limited trade agreement with Japan that will place U.S. exporters on parity with EU competitors. This could restore the ranking of Japan as a significant importer. In 2019 turkey shipments were valued at $21.9 million but with a unit price of $4,153 per metric ton. Negligible shipments were recorded from March through November.

 

Collectively during the first eleven months of 2020 the Caribbean Region (including the Dominican Republic and Haiti) was responsible for 7.8 percent of volume and 6.2 percent of value. Central America combined, represented 5.9 percent of turkey meat exports and 7.1 percent of value.

 

CHICKEN PAWS AND FEET

For April and May the data distributed by USAPEEC combined feet with broiler meat products preventing evaluation of the respective quantities and prices of feet and leg quarters. Accordingly values for the first quarters of 2019 were 2020 are documented as a basis for comparison.

 

According to the December 22nd USDA Cold Storage Report, the stock level of Paws and Feet on November 30th 2020 was down by 3.2 percent to 28.3 million lbs. from November 30th 2019. Inventory decreased 6.6 percent during November 2020 compared to October 2020 presumably due to exports to China. It will take until the end of the year to determine the effect of the Phase-One trade agreement with China coupled with the effective control of the COVID-19 lockdown on the total export of feet. March and April export data suggest displacement of sales from Hong Kong to China by comparison with previous data for Hong Kong. Prior to April approximately half of shipments destined for Hong Kong were apparently landed and trans-shipped to the Mainland.

 

PROSPECTS FOR REMAINING 2020 and 2021

The December 16th 2020 Livestock, Dairy and Poultry Outlook Report, projected broiler exports would attain 3.359 million metric tons (7,389 million lbs.) in 2021. This value represents 16.4 percent of the 20.475 million metric tons (45,045 million lb.) of broiler RTC to be produced by the U.S. industry.

 

Exports of turkey products in 2021will attain 268,000 metric tons, (589,600 million lbs.) or 9.9 percent of annual production of 2.616 million metric tons (5,755 million lbs.)

 

The Administration successfully renegotiated NAFTA into a new trilateral USMCA on September 30th 2018.This agreement has been ratified by legislatures of the three nations and took effect on July 1st 2020. It is important to recognize that exports of chicken and turkey meat products to our NAFTA partners amounted to $1.288 billion in 2017, $1.279 billion in 2018 and $1.407 billion in 2019. It will be important to respect the terms of the USMCA since punitive action against Mexico over seasonal fruit and vegetables and against Canadian aluminum will result in reciprocal action by our trading partners to the detriment of the poultry and dairy industries.

 

Both the END outbreak in backyard flocks in southern California and the localized outbreaks of LPAI in turkey flocks in the Carolinas are now officially over. In accordance with OIE principles no embargos should be imposed on either the states or counties affected.

 

 The live-bird market system supplying metropolitan areas, our numerous backyard flocks, fighting cocks and commercial laying hens allowed outside access, potentially in contact with migratory birds, represent an ongoing danger to the entire U.S. commercial industry. These segments of poultry production place at risk the export eligibility of the broiler and turkey industries notwithstanding compartmentalization for breeders and regionalization for commercial production.


 
Copyright © 2021 Simon M. Shane