Changes in U.S.-Mexican Cattle and Beef Trade

Fri, 20 Nov 2020 05:36:55 GMT

—Derrell S. Peel, Oklahoma State University Extension Livestock Marketing Specialist

Mexico has long been a major beef industry trading partner with the U.S. in roles that have continually evolved into deeper and more integrated relationships. For many years, Mexico has been the major source of imported feeder cattle. U.S. beef exports to Mexico developed in the late 1990s and Mexico has been one of the top beef export destinations since then.

Most recently Mexico has emerged as a top source of beef imports into the U.S. All of these markets have been rather dynamic in recent years and raise the question of what the nature of U.S. and Mexican cattle and beef trade will be in the future.

Since 2009, U.S. imports of Mexican beef increased by 268% to make Mexico the fourth largest source of U.S. beef imports. Mexico exports beef to a number of countries including Japan, Russia and South Korea and Mexican beef exports have more than doubled since 2009. Beef exports to the U.S. represented just over 40% of total Mexican beef exports in 2012.

U.S. imports of Mexican beef are up again so far in 2013 and are on pace to increase another 30% by the end of the year. Most of the beef imported from Mexico is middle meats from fed cattle.

The dramatic increase in Mexican beef exports is the result of a rapid conversion of the Mexican beef industry from a carcass to a boxed beef marketing system. This has opened new market opportunities in both domestic and international beef markets. It is not clear how potentially large the market for Mexican beef in the U.S. is, but there appears to be room for additional growth.

U.S. exports of beef to Mexico have declined since 2008 and are declining again in 2013. Since 2008, a combination of higher U.S. beef prices and exchange rate impacts have made U.S. beef more expensive in Mexico and are undoubtedly the major reason for declining beef exports to Mexico. However, Mexican beef prices have risen sharply in the past 18 months and domestic beef prices in Mexico are once again close to U.S. beef prices. This may help stabilize U.S. beef exports to Mexico in the second half of the year. However, high beef prices in Mexico is curtailing consumption and it is hard to anticipate much increase in beef imports from the U.S. with both domestic and imported beef in Mexico at record price levels. U.S beef exports to Mexico are likely to level off and could recover some of the recent declines in the face of expected decreased domestic beef production in Mexico in the next couple of years.

High U.S. cattle prices and drought in Mexico resulted in large and growing U.S. imports of Mexican cattle since 2010. The 2012 total of 1.47 million head was the second largest level of Mexican cattle imports since the 1995 record level of 1.65 million head.

Cattle imports from Mexico in 2012 included the largest number of spayed heifers ever imported while the number of steers actually decreased from 2011 totals. It is apparent that recent levels of cattle exports from Mexico are not sustainable and represent herd liquidation. The rate of cattle imports into the U.S. dropped sharply in late 2012 and so far in 2013.

Total imports of Mexican cattle into the U.S. in 2013 are on pace to decrease by more than 40 percent and may drop even more. Total imports of less than 800,000 head are likely for the year. Mexican herd liquidation in recent years likely means diminished beef production in Mexico and diminished levels of cattle exports to the U.S. for several years.

Cargill Enters Agreement with Kennedy and Coe to Develop Beef Cattle Sustainability Assessment

Fri, 13 Nov 2020 06:00:57 GMT

Cargill Cattle Feeders, LLC, the cattle supply arm of the company’s U.S. beef business, has entered into an agreement with Wichita-based consultancy Kennedy and Coe, LLC, in a joint effort to create a verified beef supply chain sustainability assessment program for Cargill feed yards. Kennedy and Coe will leverage its extensive beef-industry and sustainability expertise and unique ResourceMax™ assessment service developed by the company’s Vela Environmental division.

Based on the successful development of benchmarking and measurement criteria, this type of assessment could eventually be expanded to include cattle production in collaboration with stocker operators, ranchers, as well as with Cargill’s strategic feed yard partners.

“As global demand for animal proteins to nourish people continues to rise in concert with increasing population and consumer income levels, it is important to improve the way we use resources to produce beef,” said John Keating, president of Cargill’s North American beef business. “As a leading beef producer, we believe it is critical to improve the way we manage resources, and we will develop a way to measure the effective use of inputs and outputs ranging from water and feed, to worker safety, manure management, air quality, energy use, land stewardship and animal welfare. We believe this is a step in the right direction that complements our overall focus on sustainable supply chains and will also benefit our customers.”

The assessment will begin with a yearlong focus on the economic, environmental and community impacts of Cargill’s four feed yards in Texas, Kansas and Colorado. After the initial phase of discovery and data collection performed by Cargill personnel, ResourceMax™ reports will be generated, the data will be analyzed and benchmarking will be established to support ongoing improvement that will be appropriate, meaningful, holistic and verified. Kansas State University’s Dr. Dan Thomson, bovine veterinarian and director of the school’s Beef Cattle Institute, will provide technical support. Cargill beef customers also will be able to provide their sustainability criteria, resulting in a customized assessment report that gives them data to measure and document their organization’s supply chain sustainability progress.

“The goal of this project is to provide sustainability information that stakeholders find relevant across the supply chain, including suppliers, customers, NGOs, producer groups, trade associations and consumers,” stated Sara Harper, Kennedy and Coe’s director of sustainability and supply chain solutions. “Today, people have a desire to know how the food they eat is produced and where it comes from. Cargill is pioneering transparency and collaboration with its beef customers to share information important to consumers.”

“Cargill is a founding member of the Global Roundtable for Sustainable Beef, and we believe this initiative will align well with that organization’s principles and criteria,” explained Keating. “Given that beef will continue to be an important form of protein for people, we want to do as much as possible to ensure that it is produced responsibly and sustainably for current and future generations to enjoy.”

Source: Cargill

Fed Cattle News

Changes in U.S.-Mexican Cattle and Beef Trade

Cargill Enters Agreement with Kennedy and Coe to Develop Beef Cattle Sustainability Assessment