U.S. pork exports skyrocket in last two decades

U.S. pork exports skyrocket in last two decades
(MEATPOULTRY.com, March 06, 2008)
by Bryan Salvage

DES MOINES, IOWA ― Impressive changes have taken place in U.S. pork exports in the past 22 years, according to research by the Pork Checkoff and University of Missouri, Columbia. U.S. Pork exports have grown from 86 million lbs carcass weight equivalent in 1986 to 3.1 billion lbs in 2007. And the United States has gone from a negative 1.036 billion lbs in net exports in 1986 to a positive 2 trillion lbs in 2007.

Glenn Grimes, an economist with the University of Missouri, Ron Plain, professor at the University of Missouri, and Steve R. Meyer, president of Paragon Economics, are the consultants who conducted the analysis. They discovered the value of pork and pork byproduct exports grew from $1.97 per hog slaughtered in 1986 to $28.91 per head harvested in 2007. The changes in trade have permitted the pork industry to grow at an additional rate of about 0.8% per year on average over the last 22 years.

"In other words, the U.S. pork industry was about 18 million head larger in 2007 than it would have been had pork imports and exports remained at 1986 levels," Mr. Grimes said. "Not only has the increase in the quantity of pork traded allowed the industry to grow without lowering prices, but it has also added to producer' incomes in the years when net exports grew.

"Based on our efforts to calculate the effect of imports and exports on the price of hogs between 1986 and 2007, we believe these estimates are conservative because they show that prices increased only in the year when net exports grew," he added. "We assumed producers reacted to higher prices by increasing the U.S. herd enough to offset any price benefits from net export growth in the following years."

Japan is the largest U.S. pork customer, purchasing nearly 34% of U.S. pork exports in 2007. Mexico is second and Canada is third in tonnage purchased from the United States.

"We believe the total income of all U.S. pork producers has been improved by $7.4 billion over the last 22 years by the increase in exports," Mr. Grimes said.