U.S. pork exports grew in February. Steve Meyer - President of Paragon Economics - is pleased to see that growth. Of course, exports were down a bit in January when compared to a year ago, but February shipments were up 6% from one year ago and brought our year to date total into the positive side of the ledger, up just a short 2%. We were down 2.5 % through January. We did that, and the dollar strengthened, and that’s pretty encouraging, as well.
Mexico became the largest export customer for the U.S. in 2009. Meyer says that growth appears to be continuing this year...
In our largest market, which historically been Japan, they’re down about 15# so far this year, and they’ve been down kind of double digits well, 23% in January and 7% in February versus a year ago. So, some slowdown on shipments to Japan. I don’t certainly think it’s out of the realm of possibility for Mexico to become perhaps our largest volume market on muscle cuts this year. They’ve been our largest volume by-product market and total pork product market for the last two year, but they’re going to challenge Japan on just on the muscle cuts this year.
In face of H1N1 - Mexican pork production declined significantly last year. According to Meyer - the liquidation seen in Mexico’s swine herd helped the U.S. export picture...
They’re domestic pork supply is down, and they need product from somewhere so they’re importing it from the US. They generally buy low-value cuts, they buy a lot of hams, a lot of whole hams off season. So this summer you’ll see the Mexicans in the ham market pretty heavy. Which is a pretty low investment cut for them as far as cost goes. They can use those muscles in a number of ways in their cuisine, they can use ham skins very effectively for some dishes that they use, and of course they use quite a bit of animal fat in their cooking.
Generally low value cuts, but it’s mainly to feed a population and to fill in for this lack of domestic production.
Pork exports to Mexico were a factor in increasing the pork cutout values earlier this year.