With all the hype regarding cattle and beef imports over the past few years, someone other than an educator, researcher or self-professed economist must put this trade picture into perspective.
First of all, the U.S. set a record for beef and cattle imports in 1999. But, U.S. beef and cattle exports also set a record in 1999. The net result is that while on a worldwide basis the U.S. is still a net importer in terms of quantity, imports have steadily declined since the early 1990s and we set a new record low in 1999.
In fact, U.S. beef and live cattle imports and exports in 1999, on a value basis, netted each other out, the first year this has ever happened. The U.S. has been a net exporter to Mexico since 1996, but we continue to be a net importer on a value basis with Canada.
Imports of beef and live cattle from Canada, however, declined slightly in 1999, while cattle imports from Mexico increased. At the same time, net imports from Canada actually declined slightly in 1999, probably because of decreased Canadian cattle numbers.
So, if U.S. cattle inventories declined in 1999, and net imports also declined, how can the U.S. have record beef production?
It's because annual carcass weight of beef produced/beef cow has risen from 550 lbs./animal in 1978 to almost 750 lbs./animal in 1999. Today, the U.S. produces more beef from 100 million cattle than we did in 1975 with 132 million cattle.
Exports Ahead Of 1999 Using Livestock Marketing Information Center data for the first quarter of 2000 compared to the first quarter of 1999, U.S. beef imports (excluding live cattle) are 82 million lbs. ahead of last year. U.S. beef exports, however, are 173 million lbs. ahead of last year for the same period.
If this continues, we will see another significant reduction in our net import position (on a quantity basis) and likely experience a positive net export position (on a value basis) for the first time. When you include the value of beef byproducts in the overall trade equation, the U.S. has seen a very substantial trade surplus for many years.
For the first quarter of 2000, total U.S. live cattle imports have increased by a little more than 51,000 head relative to 1999. And, this takes into account about a 100,000-head increase in Mexican feeder imports. This is because U.S. producers see a combination of low costs of gain, high feeder cattle prices and a higher cattle market. But, also note that live cattle imports from Canada have declined by about 49,000 head for the first quarter of this year.
At the same time, for the first quarter of 2000 as compared to 1999, live cattle exports have increased by a little more than 61,000 head - the result of increased feeder cattle exports to Canada. This means about 60% of the increase in feeder cattle imports from Mexico are being offset by increased feeder cattle exports to Canada.
Couple this with reductions in slaughter cattle imports from Canada and our much improved beef trade position, and it appears 2000 has started out to be a banner trade year for the U.S. beef industry.
And, our market prices for the first quarter reflect this healthy trade position. When you add strong domestic beef demand, lower cattle inventories and low cost of gain, it's easy to see why the cattle industry's future looks brighter than it has for some time.
Tactics To Increase Exports There is still much more work to do. Five years ago, Montana and other northern states cooperated on the Northwest Cattle Project to level the playing field with Canada. The result was a tremendous jump in feeder cattle exports to Canada.
It is also why two years ago, the Montana Stock Growers Association (MSGA) adopted a four-point marketing plan of mandatory price reporting, country of origin labeling, limiting the use of USDA Grade, and working to make sure the trade arena is a level playing field for U.S. producers.
MSGA successfully passed resolutions through the National Cattlemen's Beef Association (NCBA) in every one of these areas. Mandatory price reporting is now law, labeling legislation has been introduced, the USDA is expected to respond to NCBA's petition of limiting the use of the USDA Grade. Bottom line - we are winning in the trade arena.
So, don't be tempted to buy into the hype and misinformation about imports. Take a good look at the big picture - both imports and exports - and the real progress we are making.
Top sirloin steaks made with Certified Angus Beef (CAB), aged and then fully cooked in a bourbon sauce is the grand prize winner in the Best New Beef Products Awards 2000.
Announced at the recent Cattle Industry Summer Conference, the RMH Foods' product was one of four product-category winners in the $250,000 contest sponsored by the beef checkoff. The purpose of the program is to promote development of branded, convenient beef products as a way to continue the growing consumer demand for beef.
The four category winners were:
- Grand prize winner and $100,000 winner in the Best New Retail Beef Product category - RMH Foods' Quick-N-Easy Top Sirloin Steaks in Bourbon Sauce.
- $100,000 winner for Best New Foodservice Beef Product - King's Command Foods' (fully cooked) Old- Fashioned Style Beef Patties.
- $25,000 winner for Best New Beef Product Marketed by a Small Company - Eaves Foods Inc., CAB Bubba Burger.
- $25,000 Most Innovative, Commercially Promising New Beef Product - Harris Ranch Beef Co.'s Fully-Cooked Western Style Beef Stew.