09-09-19 Weekly USMEF Audio Report: Strong Rebound in Mexico Helps July Pork Exports Set New Record

Weekly USMEF Audio Report: Strong Rebound in Mexico Helps July Pork Exports Set New Record

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DENVER, CO – September 9, 2019 –

U.S. pork exports posted the best month ever in July, reaching 233,242 metric tons (mt), up 32% from a year ago and topping the previous record from April 2018. Export value increased 34% to $623.3 million, breaking the previous high reached in November 2017. 


One of the biggest factors in this performance was a strong rebound in exports to Mexico, which have recovered nicely since regaining duty-free status. A 20% retaliatory duty, which was imposed on most U.S. pork products for nearly a full year in response to U.S. tariffs on steel and aluminum, was removed in late May. In July, exports to Mexico topped 67,000 mt, up 19% from a year ago, while value surged 38% to nearly $127 million. 

Gerardo Rodriguez, U.S. Meat Export Federation (USMEF) marketing director for Mexico, Central America and the Dominican Republic, explains that USMEF ramped up its customer outreach in Mexico during the time the retaliatory duty was in place, working to defend U.S. market share and identify opportunities for new products. For example, he notes that USMEF worked closely with one of Mexico’s largest pork processors, Capistrano, to develop an economically priced ham that has performed very well since its introduction into the market. He also discusses development of new processed pork items sold in Mexico’s rapidly growing convenience store sector.

Rodriguez on pork to Mexico rebound 9-9-19

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09-09-19 TSGTA: Three regional utilities announce decision to join Southwest Power Pool market

TSGTA: Three regional utilities announce decision to join Southwest Power Pool market

September 9, 2019 – LITTLE ROCK, Ark. — Basin Electric Power Cooperative, Tri-State Generation and Transmission Association, and the Western Area Power Administration (WAPA) announced Sept. 9 their decision to join Southwest Power Pool’s (SPP) Western Energy Imbalance Service (WEIS) market. When SPP launches the WEIS in February 2021, it will become the market administrator for these and potentially other utilities in the west. The market will centrally dispatch energy from these participants throughout the region every five minutes, enhancing both the reliability and affordability of electricity delivery from utilities to their customers.

“SPP has a proven track record in operating energy imbalance and full day-two markets,” said Paul Sukut, Basin Electric CEO and general manager. “SPP’s experience makes them an excellent choice for operating a market. Adding to the advantage of SPP is their independent board of directors, a proven stakeholder process, and a governance structure that specifically includes commissioners from state regulatory commissions.”

“Through the WEIS, our regional utilities are moving forward together with a cost-effective solution that quickly increases market efficiencies, reduces expenses for our members and electric consumers, and supports Tri-State’s rapid transition to cleaner energy,” said Duane Highley, Tri-State’s CEO. “Our entry into the WEIS advances the goal to provide utilities across the west options to participate in a real-time, beneficial market solution.”

“We are committed to seeking mutually beneficial partnerships consistent with sound business principles,” said WAPA Administrator and CEO Mark A. Gabriel. “With the pace of change in the electric industry increasing, generation options evolving, and pressing needs regarding balancing area operations, we have a need to look at different market structures for WAPA’s diverse customers and needs. Our goal is to keep our value at the highest level while adhering to our core value to do what is right.”

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READ the NAFB’s National Ag News for Monday, September 9th

Sponsored by the American Farm Bureau Federation

READ the NAFB’s National Ag News for Monday, September 9th

U.S., U.K. Trade Talks Could Get Bumpy Around Poultry

Assuming that trade negotiations ever get going between the United States and the United Kingdom, feathers on both sides could get ruffled over poultry. U.K. Prime Minister Boris Johnson told U.S. Vice President Mike Pence that, “We’re not to keen on chlorinated chicken.” During a visit to the U.K. last week, Pence did admit that poultry could become a sticky issue in the negotiations. Politico says Johnson’s comments refer to the American practice of washing chicken with chemicals to kill pathogens like salmonella and E. coli. The process is called “pathogen reduction treatment” and it’s banned in the European Union. During dinner remarks last week, Pence admitted that chlorinated chicken will be the subject of some “pretty tough discussions.” During discussions last week, Johnson talked about his desire to free up the U.S. market to more British exports. He says Americans “don’t eat any British lamb or beef or haggis from Scotland.” Haggis is the national dish of Scotland and a pudding made from sheep’s heart, liver, and lungs. Johnson promises to pull the U.K out of the European Union by October 31.


Pork Exports Reach New High Mark Despite Trade War

U.S. pork exports were at a record-high in July while beef exports were relatively steady with last year’s strong results. That’s from data released by the USDA and put together by the U.S. Meat Export Federation. July pork exports surged to 233,242 metric tons, a 32 percent jump that topped the previous record set in 2018. Export value was $623.3 million, up 34 percent as it broke the previous high reached in November of 2017. Although U.S. pork faces retaliatory tariffs in China, American pork exports to China and Hong Kong contributed a good chunk of the July volume and value records. Beef exports increased one percent in July to 117,842 metric tons. The export value of $720.4 million was down slightly from a year ago but was still the seventh-highest monthly total on record. January-July beef exports were down two percent from a year ago in volume, while export value was slightly below last year’s record pace. Shipments to Mexico jumped higher in July after a 20 percent tariff was removed.


White House Considering Biofuel Quota Boost

A Bloomberg report says top Trump Administration officials have put together a plan that would give a five percent boost to the renewable fuels blending quota in 2020. The plan comes as President Donald Trump seeks to counter farm-state accusations of undermining a U.S. mandate that compels the use of corn-based ethanol and soybean-based biodiesel in the nation’s fuel supply. Officials from the White House, USDA, and the Environmental Protection Agency have been cooperating for weeks in ironing out the final details of the initiative designed to encourage U.S. biofuel demand. Bloomberg sources say the president hasn’t given final approval to the plan yet. Back on August 29, Trump took to Twitter and promised a “giant package” of changes would be submitted and approved within two weeks. While biofuel company shares surged in value with the news, some biofuel advocates say the tentative plan falls short of their push for immediate action to offset waivers exempting some oil refineries from the mandates. “We just want the EPA to enforce the standards that Congress gave them,” says Renewable Fuels Association Chief Geoff Cooper. “That means redistributing projected exemptions in the 2020 rule to ensure the statutory volumes for conventional renewable fuels remain whole.” He says it’s hardly a big gift to corn. It’s just “following the law.”


McKinney: No USMCA Sales to Canada So Far

Canadians are pleased with the U.S.-Mexico-Canada Trade Agreement. However, the Hagstrom Report says U.S. companies haven’t yet made any new sales in Canada based on the agreement. That news comes from USDA Under Secretary for Trade and Foreign Agricultural Affairs Ted McKinney, who spoke to reporters while on a trade mission in Canada. Government and agriculture industry officials in Canada have said they’re happy with the agreement. However, there haven’t been any discussions about increases in dairy purchases or increases in any of the areas through which U.S. producers might benefit under the agreement. He did say that wheat grading, poultry, wine, and biotechnology provisions could also be a big benefit to U.S. agriculture. McKinney also says Canadian officials have told him that the Canadian Parliament will not vote on the agreement until the U.S. Congress has voted. McKinney says the USDA is also set to sponsor trade missions to Mexico, Ghana (GAH-nah), and Vietnam this year.


More Farmers Falling Behind on Loans

A U.S. banking regulator says more farmers are falling behind on loans held by community banks when compared to last year. The Federal Deposit Insurance Corporation says it’s watching for more risks in the ag sector. In its quarterly report, the FDIC didn’t refer directly to the Trump Administration’s trade war with China, which began in 2018. In a prepared statement, officials say, “We continue to monitor risks in the agriculture sector from low commodity prices and farm incomes.” The FDIC says the share of long-past due farm loans held by community banks, which are the major agricultural lenders, was 1.28 percent in April through June, up 13 basis points from the same time last year. The ratio captures the share of farm loans that are at least 90 days past due, or those loans which no longer accrue interest because of repayment doubts. Reuters says commodity prices have been hurt over the past year by a U.S.-China trade war that’s led to higher Chinese tariffs on U.S. agricultural exports, including soybeans.  


Tyson Volume Loss Due to Fire Minimal

The fire at the Tyson Foods plant in Holcomb, Kansas, caused minimal volume losses to the company as it moved production to other plants. Chief Executive Noel White spoke at an investor conference last week. All of the employees were safely evacuated that day. The processing side of the plant wasn’t affected by the fire and is still operating. “I would say the volume loss has been somewhat minimal,” he said. “Now there is a cost in moving cattle a long distance. We can still service our traditional suppliers in that area and we have a lot of long-term, loyal customers that source from the plant. We’ve been able to move those orders to a number of our other plants.” Meating Place Dot Com says White expects the plant to get fully back in operation in the next couple of months. The electrical system was the hardest-hit part of the plant, with most of the downtime due to rewiring the plant’s electrical system. Last week, Tyson lowered its earnings guidance for fiscal 2019.

SOURCE: NAFB News Service