Beef Buzz News
Livestock Economists Derrell Peel and Don Close Weigh In On U.S. Beef Exports and Imports During NCBA Webinar
Thu, 18 Jun 2020 10:12:52 CDT
During this week's NCBA webinar Don Close, senior analyst-animal protein for Rabo AgriFinance, and Dr. Derrell Peel, OSU Extension livestock market economist, addressed the issue of U.S. beef exports and imports.
They first tackled beef exports.
We're doing well with our two major customers South Korea and Japan, Peel said. China is still small from a beef standpoint, but their protein needs are huge. That market will continue small but even a small increase would make a significant impact, Peel said.
The OSU livestock economist noted USMCA is a good thing, but he is concerned about Mexico as its economy is in shambles right now.
Overall, Peel said the trade situation for U.S. beef looks favorable and may be one of the brighter spots as we move towards the end of the year.
Don Close answered the question of China fulfilling its Phase One trade agreement with the U.S.
Close said China is purchasing less beef from Australia and New Zealand and he thinks they could be creating an opening to buy more U.S. product. China needs to buy high value products to fulfill their Phase One deal, Close said.
The livestock analyst concurred with Peel in that the U.S. is very well positioned on the export front for short- and long-term gains.
On the question of beef imports, Peel said it's a complex issue.
When we talk about beef and beef demand it is not simple as markets tend to balance out the best value and demand for specific products, Peel said.
Close addressed the concerns about importing cattle to meet U.S. consumer's demand for lean hamburger.
With 82 percent of our production being fed beef the industry is trying to meet the demand for fast food burgers, Close said. We do not have enough domestic cow slaughter to meet the demand for lean hamburgers.
It provides us the opportunity to sell 50 percent trimmings at a higher price than we could instead of that product being rendered, Close said.
Why not stop importing lean beef and use our cull cows?
By my estimates we would have to double our cow slaughter to not need imported beef to meet the lean hamburger demand, Peel said. That would not be sustainable.
If we didn't import, Peel said it would make our cull cows worth more, but it would make us less competitive with pork and poultry in the fast food industry as burger prices would have to increase, Peel said.
Click on the LISTEN BAR below to hear more comments from Close and Peel during the recent NCBA webinar.
The Beef buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network and is a regular audio feature found on this website as well. Click on the LISTEN BAR below for today's show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
Ron Hays Beef Buzzes With Derrell Peel and Don Close
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