US beef exports to stabilise in 2016

By Oscar Rousseau

- Last updated on GMT

Australia has reduced its cattle supply, posing questions on its ability to compete in the global market
Australia has reduced its cattle supply, posing questions on its ability to compete in the global market

Related tags International trade Export Import Beef

Uncertainty and volatility in the US beef export market will stabilise in 2016, according to a report from Rabobank.

Uncertainty and high price volatility dogged exports of US beef in 2015. However, these factors have been predicted to abate with the country’s cattle sector set to stabilise in 2016, according to Rabobank’s Global Beef Quarterly Q4 Report​.

This year “a number of factors have collided to create the uncertainty​” in America’s vacillating cattle export sector, Angus Gidley-Baird, Rabobank’s senior analyst, told GlobalMeatNews.

A strong currency, low exports, high imports, high stocks, local cowherd rebuilding, low feed costs, high cattle costs and high retail prices are just some of the factors that have created uncertainty in the market, he added.

But Gidley-Baird believes the factors that caused so much “uncertainty​” will “settle down​” as “normality comes into play”.

In the first 10 months of 2015, the US exported 624,214 metric tonnes of beef, a 13% fall compared to the same period in 2014, according to the US Meat Export Federation.

With pressures set to ease in the US, the key export markets to watch in 2016 are Brazil and Australia, according to Rabobank’s beef report, published on Monday 15 December.

Rapid growth​ 

Brazil is looking to expand production by chasing new markets in Saudi Arabia and China, as well as keeping one eye on the possible entry to the US market – the world’s biggest importer of beef, according to the US Department of Agriculture.

With all this in mind, the “real the question,​” according to Gidley-Baird, is whether Brazil is “really going to drive rapid export growth​” for the US.

In the case of Australia, Gidley-Baird expects to see a large reduction in the supply of cattle. This, he notes, will be interesting as questions may be raised on Australia’s ability to manage the reduction in cattle supply with its global market.

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