In what has been hailed as the most significant outcome on agriculture in the World Trade Organizationrsquos 20year history member countries reached a historic agreement on ag export subsidiesnbsp when they wrapped up their Tenth Ministerial Conference in Nairobi Feedstuffs reportsA number of countries are currently using export subsidies to support agriculture exports The legallybinding decision would eliminate these subsidies and prevent governments from reverting to tradedistorting export

U.S. beef exports surge to record levels

Beef export value averaged $320.92 per head of fed slaughter in August, up 11% from a year ago.

U.S. beef exports topped $750 million in August for the first time, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF).
 
Specifically, August beef export value was $751.7 million, which was 11% more than the previous year, easily exceeding the previous monthly value record of $722.1 million reached in May 2018. In terms of volume, August beef exports were 7% more than the previous year at 119,850 metric tons.
 
For January through August, beef exports totaled 899,300 metric tons, up 9% from a year ago, while value climbed 18% to $5.51 billion.
 
“U.S. beef exports continue to achieve tremendous growth, not only in our mainstay Asian markets but in the Western Hemisphere as well,” says Dan Halstrom, USMEF president and CEO. “USMEF is excited about the recent market access developments achieved by the Office of the U.S. Trade Representative (USTR) and USDA, with favorable terms being preserved in Mexico, Canada and South Korea and trade talks getting underway with Japan. A trade agreement with Japan would bring opportunities for even greater expansion as U.S. beef becomes more affordable for Japanese consumers and is back on a level playing field with Australian beef.”
 
Beef export value averaged $320.92 per head of fed slaughter in August, up 11% from a year ago. The January-August average was $318.66 per head, up 16%. Through August, beef exports accounted for 13.5% of total U.S. beef production, which was 0.7% more than the previous year.
 
Conversely, U.S. pork exports were pressured by retaliatory tariffs in China and Mexico. August pork export volume was down 1% from last year at 182,372 metric tons, while export value fell 3% to $494.1 million.
 
China’s duty rate on pork muscle cuts and variety meat increased from 12% to 37% in April and from 37% to 62% in July. Mexico’s duty rate on pork muscle cuts increased from 0% to 10% in June and then jumped to 20% in July (pork variety meats continue to enter Mexico duty free). Beginning in June, Mexico also imposed a 15% duty on sausages and a 20% duty on some prepared or preserved hams and shoulders.
 
“Pork exports have posted an impressive performance in 2018, but the retaliatory duties are a clearly a significant obstacle,” Halstrom explains. “The fact that U.S. trade officials were able to secure duty-free access for U.S. red meat in the new U.S.-Mexico-Canada Agreement is critically important, and we are hopeful that duty-free access for U.S. pork entering Mexico will be restored soon.
 
“Tariff relief in China may not come as quickly, but USMEF continues to work with industry partners to keep as much product as possible moving to China while also working aggressively to expand exports in other key markets, including Korea, Central and South America, the ASEAN region and Australia.”
 
Keep in mind that U.S. beef still faces retaliatory duties in China and Canada. China’s duty rate increased from 12% to 37% in July, with the higher rate applying to all eligible products. Canada’s 10% duty, which also took effect in July, applies to cooked/prepared beef products. All other U.S. beef still enters Canada duty free.
 
Among August beef export highlights:
 
Beef exports to South Korea were 42% more than a year ago in volume (24,482 metric tons) and set another new value record at $176.4 million (up 60%). For January-August exports to South Korea of 161,379 metric tons, are 39% more than a year ago; export value was 54% more at $1.15 billion, just short of the 2017 full-year record of $1.22 billion.
 
Under the Korea-U.S. Free Trade Agreement (KORUS) that took effect in 2012, Korea’s duty rate on imports of U.S. beef declined from 40% to 21.3% and will be eliminated by 2026. These terms are preserved in the revised KORUS agreement signed Sept. 24.
 
Beef exports to leading market Japan climbed 8% from a year earlier in August to 33,548 metric tons, including a post-BSE record for muscle cuts of 28,863 metric tons. August export value was $209.3 million, up 5% from a year ago and the highest since 1996. For January through August, exports to Japan were up 7% from a year ago in volume at 224,785 metric tons; value was 11% more at $1.42 billion.

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