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Exports Are Key To Rancher Success

Article-Exports Are Key To Rancher Success

Feedyards moving cattle at aggressive pace

On Wednesday, I attended the 2012 Governor’s Ag Development Summit in Pierre, SD. The annual conference focuses on identifying key issues facing farmers and ranchers in the state. This year’s event featured speakers discussing agriculture policy, exporting and international trade, livestock development and succession planning. I will summarize each topic in the next couple of weeks, but today, I’m going to dial in on the topic of export markets.

Ambassador Islam Siddiqui, Office of the U.S. Trade Representative, spoke about how exports are an integral part of job creation in the U.S. The Obama administration has a goal of doubling U.S. export markets by 2014. Since 2009, exports have increased by 34%, and agriculture has expanded by 39%.

“The livestock industry is a resilient one and has done very well in terms of exports. In 2011, U.S. beef exports set a record high of $5 billion. The pork industry, in spite of dealing with H1N1, surpassed $7 billion,” Siddiqui said.

Another speaker on the export panel, Dean Gorder with the North Dakota Trade Office, explained that 95% of our customers live outside of the U.S.

“Advocacy and education is so important on our trade missions. There are clients around the world who will pay for a superior product that has a guarantee of food security and food safety,” said Gorder.

Boosting our beef business around the world will be critical to the success of the U.S. cattle rancher. However, the latest World Agricultural Supply and Demand Estimates (WASDE) report released June 12, predicts 2012 beef exports will decline about 6% in volume, with imports increasing about 18.5%.

According to Tim Petry, North Dakota State University Extension livestock economist, “Attempting to explain international trade is complicated because many factors affect trade flows of agricultural commodities, including beef. But to try to simplify beef trade, a few important factors include general economic conditions, exchange rates, government policies, and changing beef production and price levels in the many beef importing and exporting countries.

“The U.S. is a major participant in the world beef market because we are the largest beef producer, largest consumer, second largest importer behind Russia, and the third largest exporter behind Australia and Brazil. Some reasons for USDA projecting more imports and less exports in 2012 are the strengthening value of the U.S. dollar; lower U.S. beef production, especially cow beef; higher U.S. beef prices; and increasing beef production and expected increases in exports from Australia. Even though more beef imports and less exports are predicted for 2012, that won’t be enough to offset the expected 3.3% decline in beef production that is predicted,” Petry said.

Read more about beef exports here.

What can be done to boost beef demand abroad?

As progress is made with our foreign trade partners, Siddiqui promised South Dakota ranchers that, “The USDA will focus on breaking trade barriers, updating free trade agreements and promoting U.S. agriculture around the world.”

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