Slow trade in the US imported beef market
02 June 2016
The past week saw relatively little activity in the US imported beef market, at least for spot and short term contracts, according to the most recent report from the Steiner Consulting Group. This is in contrast to what was a stronger month of beef exports from Australia to the US during May (29,324 tonnes swt – the largest monthly volume so far this year, but 30% lower than last year).
The weekly Steiner report noted limited offers from Australian exporters, but greater availability from New Zealand (NZ) traders, aiming to secure volume and prices ahead of the slowdown in their processing season. Australian traders are also tending to ask for higher prices than their NZ counterparts, with strength in alternative markets in Asia providing a buffer.
The imported 90CL cow beef indicator was up 1.5US¢ this week, to 195US¢/lb CIF (up 3.9A¢, to 596A¢/kg CIF).
US beef production is another factor to consider moving forward. For March, April and May, weekly beef production was reportedly 5.4% higher than last year (around 11,000 tonnes cwt extra per week), while US beef exports have only accounted for around 10% of the extra production. This means a lot more domestic beef remaining in the US market. Beef production for the second half of 2016 is forecast to increase 4.2% on last year, which will put slightly more downward pressure on prices as the year goes on.
