051020 Policies, & Diseases Increase Meat Market Complexity

October 22, 2005

The rise of pork and beef consumption in the European Union (EU) coupled with a fall in production, changing agriculture policies and the constant threat of animal diseases make for a complex trade landscape, according to U.S. Meat Export Federation (USMEF) President and CEO Philip M. Seng, who spoke at the International Meat Secretariat (IMS) regional conference in Rome last week.

Population and resource management directly impact supply and demand while knowledge and technological advances influence global trade policies, explained Seng, the immediate past president of IMS. Global economic integration has made trade more important than ever.

“In studying these principles, we can see where trends are occurring and then predict changes in the global red meat and poultry trade landscape,” Seng said. “More importantly, we can try to find areas where proactive approaches can shape changes to reach a beneficial end.”

So far this year the EU is second to China in worldwide pork consumption, but leads the world in pork exports. The value of EU pork exports last year was $3.1 billion, but the pork production growth rate in the EU has remained flat since 1999, which could lead to a net deficit in future years.

In Poland, for example, small-scale hog production constrains the supply, and about 3 million hogs are slaughtered annually by farmers for their own consumption.

Meanwhile, the EU has become one of the largest beef importers in the world as agriculture policy changes have resulted in declining beef production. The EU is second to the United States in beef consumption and fourth behind the United States, Japan and Russia in beef imports.

Approximately 90 percent of U.S. beef exported to the EU is destined for the hotel sector. USMEF is developing a lucrative niche in this sector, positioning U.S. beef as a premium product that stands apart from grass-fed South American beef.

Through the first eight months of this year, the value of U.S. beef (excluding variety meat) exports to the EU has increased 26 percent to $9.5 million compared to the same time period last year while volume is also up 15 percent to 1,679 metric tons.

Since the EU became a net importer of U.S. beef in 2003, Brazil has been the largest supplier. This could change with recent cases of foot-and-mouth disease in Brazil, resulting in more than 30 countries banning Brazilian beef so far.

Zero tolerance of animal disease outbreaks is one of several factors affecting market access. “As tariffs fall, countries find other ways to protect their domestic industries,” Seng said.

Seng emphasized making trade access decisions on the basis of sound science is vital for international trade.

IMS brings together meat and livestock organizations providing a forum for exchange of ideas and experiences on issues affecting the international meat and livestock sector. Through its conferences, meetings and publications, IMS promotes the sustainable production, promotion, trade and consumption of meat worldwide.

The U.S. Meat Export Federation is the trade association responsible for developing international markets for the U.S. red meat industry and is funded by USDA, exporting companies, and the beef, pork, corn, sorghum and soybean checkoff programs.


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