The future of meat through a crystal ball

by Sally Colby

Pork is up, beef is steady and chicken is somewhere in between. That’s the nutshell version of what John Hinners, vice president of industry relations for the United States Meat Export Federation (USMEF), explained at the recent PennAg Industries Animal Agriculture Expo.

“Our main mission is to put U.S. meat on the world’s table,” said Hinners, listing Mexico City, Tokyo, Hong Kong and Singapore as some of the organization’s target cities. “We sell meat in more than 80 countries around the world.”

The USMEF isn’t a lobbying organization, but they work closely with organizations such as the National Pork Producers Council to ensure trade agreements are resolved. USMEF’s efforts are funded primarily through beef, pork, lamb, corn and soybean checkoff programs, matched with market access programs from the U.S. government.

Hinners said exports are key to the industry’s continued success. “We know that corn and soybean industries rely on livestock enterprises around the U.S.,” he said. “When we export a ham to another country, we’re not only providing food to consumers there, we’re also exporting 2.76 bushels of corn, 9.1 pounds of DDG and 33.5 pounds of soybean meal. It’s a value-added program we’re excited to be part of.”

In comparing production levels over the years, Hinners said farmers have been raising more product. “Back in 2000, 8.1% of our pork and pork variety meats were exported,” he said. “In 2019, roughly 27% of pork production was exported. Beef exports have not been as aggressive – 4.3% in 2000 and today, roughly 14.1%.”

Producers were happy to learn that U.S. production of beef, pork and poultry will be at record levels in 2020. However, global meat production will decline in 2020, primarily due to African swine fever (ASF). Hinners said beef production will fall globally, primarily due to fires in Australia, resulting in short supply. However, he said U.S. trade policy gains should promote optimism.

“We have a lot to do as an industry, working with our partners and checkoffs, leveraging those dollars with the USDA and getting the right messages out to the world about our supply,” said Hinners. “We want to remain a reliable supplier of product – there will be a lot of meat coming to the market in 2020.”

Since pork production was featured at the day-long PennAg event, Hinners discussed that aspect of the USMEF. “In 1994, the U.S. was a net pork importer due to various promotion aspects of the checkoff and the National Pork Producers Council opening up the market,” he said. “Today, we are the second largest exporter behind the entire European Union.”

To illustrate how U.S. pork products are distributed around the world, Hinners explained that 40% of picnics go to northern Asia, Mexico and Canada. About 35% of hams go to Mexico, Canada and South America, about 20% of loins go to northern Asia, and bacon tends to stay in the U.S. Variety meats sell well outside the U.S., with about 90% of tongues leaving the U.S. and the same percentage of stomachs, bladders, uteruses, hearts, livers and kidneys sent overseas.

According to Hinners, the average U.S. consumer eats about 225 pounds of beef, pork and poultry annually, and noted each of those sectors will see increased production through 2020. The BSE incident and resulting ban on exporting beef provided an opportunity for pork to take off, and pork filled many markets. However, there were some losses, mostly short-term, in the pork industry.

“We know Mexico had a 20% duty on some pork products going into Mexico,” said Hinners. “That allowed Canadian and some European pork to compete with the United States. We lost about 4% market share, and it cost about $835 million as an industry, or $6.65/head.” Other losses included Japan at $600 million or $4.55/head.

Hinners explained some of the unique features of various markets and how U.S. pork fills those needs. One is South Korea, which is seeing growing pork consumption and production. “If you were to go into South Korea in 1970 and live there for a year, every month you would eat less than one pound of beef, pork and poultry,” he said. “Fast forward to 2018, consumption is 108 pounds of beef, pork and poultry. We look at these trends and match where we have the greatest opportunity.” Hinners added South Koreans have a single-household society and lifestyles are changing. They tend to eat alone, enjoy high-end foods and parties at home, and want restaurant-quality foods delivered to them.

Because more South Korean women are working, they seek convenience foods. There’s also an aging society whose tastes have changed. South Koreans are highly interested in pork bungs, which include the rectum and large intestines, providing another strong export market. Citizens are careful not to waste food because of the country’s food waste tax.

Colombia is another strong market for U.S. pork. Hinners said a strong advertising campaign has changed the views of consumers in that country. “It’s the sixth largest market for U.S. pork,” he said. “Wet markets and butchers account for about 70% of sales. Colombian pork buyers are coming to the U.S. and visiting land grant universities to learn more about pork production and processing. Production isn’t keeping up with demand in Colombia.”

Japan’s beef and pork consumption is growing, and in some cases, exceeds fish. “They opened their beef market to cattle over 30 months of age,” said Hinners. “That’s an incremental value of about $150 to $200 million. We get $1/pound for beef tongue in the U.S., but if we send it to Japan, they sell it for $5.50/pound.”

Hinners described tonkatsu, a popular dish in Japan, as a crisp, fried pork loin cutlet. The USMEF worked with a Japanese chain restaurant to market this dish, and there are now 181 outlets selling 100% U.S. pork loin.

In China, there’s uncertainty on several levels. Hinners noted a 10.8 million metric ton pork shortage in that market, which is a significant loss. “There’s a huge opportunity there,” he said. “They’re going to eat less pork in China because of ASF, they’ll eat more poultry, and we don’t know what the effect of the coronavirus will be. We’re forecasting huge growth in that market for U.S. pork exports.”

2020-03-06T14:34:31-05:00March 6, 2020|New England Farm Weekly|0 Comments

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