Cut meat in rack

For 2020 the USDA estimates net exports of beef and veal will be equal to 2 percent of production.

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In earlier posts we looked at the growing role of trade in global and U.S. crop production. The trends are mixed at the crop-level but across all major crops, global trade has clearly become more significant during the past decade. That left us wondering about the livestock sector. This week’s post considers the impact of trade in the United States for beef, chicken and pork.

Data context important

Before jumping in consider information about the data.

  • The data used for this post were reported by the U.S. Department of Agriculture-Foreign Agricultural Service’s Production, Supply and Distribution database.
  • The data presented are net exports as a share of total U.S. production. Net exports were calculated by taking exports minus imports. Positive values indicate exports were larger than imports. Negative values occur when imports are larger than exports.
  • Net exports, rather than just exports alone, are important because some meats have significant imports. For example imports were equal to 11 percent of beef production and 3.5 percent of pork production in 2019. Imports are much less significant for chicken at 0.3 percent of production.
  • Net exports were reported as a share of production to provide context. That’s important because production has increased across the 60 years of data considered.

Beef, veal trade varies

Figure 1 shows the role of trade in U.S. beef and veal. Before 1990 net exports of beef and veal were negative, with the magnitude equal to -4 percent to -8 percent of production. Beginning at about 1990, a trend toward more exports began. By the early 2000s net exports were still negative, but the magnitude was smaller at -2 percent of production. Net exports plummeted in 2004 after the December 2003 confirmed case of bovine spongiform encephalopathy. That shut the United States out of many important export markets.

By 2011 net exports turned positive at 3 percent as the United States exported more beef than imported. Net exports then retreated through 2015 before trending to more again. Again in 2018 the United States exported more beef and veal than imported. Trade was mostly balanced in 2019. For 2020 the USDA estimates net exports will be equal to 2 percent of production.

While it can be tempting to look at recent data and focus on net exports being positive or negative, it’s essential not to lose sight of the bigger picture. During the past three decades a rapid shift toward more exports has been underway.

Chicken exports use large share

Figure 2 shows U.S. chicken net exports as a share of production. The USDA first started reporting those data in 1999. Overall the United States imports little chicken. Net exports have been equal to 15 percent to 20 percent of U.S. production. For a reference point, the USDA estimates corn exports to equal 13 percent of production for the 2019-2020 marketing year.

Pork exports shift

Figure 3 shows the pork data. Similar to beef, pork has also seen a significant shift during the past three decades. Before 1990 the United States imported slightly more pork than it exported; net exports were -1 percent to -3 percent of production. After decreasing in the 1980s, net exports have tended to increase for more than 30 years. In 2019 net exports were 19 percent of production. For 2020 the estimate is for net exports to reach 22 percent of production, the best in 60 years.

Wrapping it up

During the past three decades a structural shift toward more exports of beef and pork has been underway. Before the 1990s the United States imported more beef and pork than it exported. But since 1990 net exports as a share of production has increased.

While the trend has been toward more exports, the magnitudes vary. For beef and veal, 2020 net exports are estimated at 2 percent of production. For chicken at 16 percent and pork at 22 percent, net exports account for a much larger share of production.

It’s no secret that trade can be an important source of growth for a sector. For example in an earlier post we noted that beef consumption in the United States has been extremely lackluster – 0.2 percent annually between 1990 and 2016.

Looking ahead, trade is at the front of everyone’s mind. That’s especially the case as U.S. livestock producers hope for even more exports in light of China’s African swine flu challenges.

Visit aei.ag for more information.

This article originally ran on agupdate.com.

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