How U.S. Pork Exports Reached a Record High in 2020
Pork is one of the most widely consumed meats in the world, and the U.S. is a major exporter of pork and pork products. In 2020, the value of U.S. pork exports reached a record $7.7 billion, up 11 percent from the previous year. What were the main drivers and challenges for U.S. pork exports in 2020, and what are the prospects for 2021 and beyond?
The Drivers For U.S. Pork Exports
1.China
The main driver for U.S. pork exports in 2020 was the strong demand from China, which overtook Japan as the top market for U.S. pork. China faced a severe shortage of domestic pork supplies due to the outbreak of African swine fever (ASF), a highly contagious and fatal disease that affects pigs. ASF reduced China’s hog herd by more than half, causing pork prices to skyrocket and prompting China to increase its imports of pork from various sources, including the U.S.
The U.S. benefited from the phase one trade deal with China, which was signed in January 2020 and committed China to purchase more agricultural products from the U.S., including pork. The deal also reduced some of the non-tariff barriers that had previously hindered U.S. pork exports to China, such as sanitary and phytosanitary restrictions, inspection and registration requirements, and traceability rules. As a result, U.S. pork exports to China surged 75 percent in 2020, reaching $2.3 billion.
2.Japan
Another driver for U.S. pork exports in 2020 was the rebound in Japan, which remained a loyal and lucrative market for U.S. pork despite the increased competition from other suppliers. Japan imported $1.6 billion worth of U.S. pork in 2020, up 7 percent from 2019. The U.S.-Japan Trade Agreement, which entered into force in January 2020, lowered the tariffs faced by U.S. pork in Japan, making it more competitive with pork from countries that had already signed trade deals with Japan, such as Canada, Mexico, Australia, and the European Union.
The Challenges
However, not all markets were favorable for U.S. pork exports in 2020. Some of the challenges faced by U.S. pork exporters included:
- The COVID-19 pandemic, which disrupted global trade flows, logistics, consumer demand, and foodservice operations.
- The economic recession and currency depreciation in some markets, such as Mexico, which reduced the purchasing power and affordability of imported pork.
- The ongoing trade tensions and retaliatory tariffs imposed by some countries, such as China and the European Union, on U.S. pork products.
- The increased competition from other pork exporters, such as Brazil, Canada, and the European Union, which also expanded their market share in China and other regions.
Despite these challenges, U.S. pork exports managed to achieve a record high in 2020, demonstrating the resilience and adaptability of the U.S. pork industry.
The Opportunities
Looking ahead, U.S. pork exports are expected to face some headwinds in 2021 and beyond, as China’s domestic pork production recovers from ASF and its import demand declines. This will likely increase the competition among pork exporters to find alternative markets that can absorb the excess supply of pork. However, there are also some opportunities for U.S. pork exporters to maintain or increase their market share in other regions, such as:
- Latin America, where U.S. pork enjoys duty-free access and strong consumer preference in many markets under various trade agreements.
- Southeast Asia, where U.S. pork can capitalize on the growing demand for protein and the ASF-induced supply gaps in some countries.
- Europe, where U.S. pork can leverage its high-quality and niche products to cater to discerning consumers.
U.S. pork exports had a remarkable performance in 2020 thanks to the strong demand from China and Japan. However, U.S. pork exporters will need to continue to innovate and diversify their markets in order to sustain their competitiveness and growth in the global pork trade.
The Global Demand for Pork in 2021
Pork is one of the most widely consumed meats in the world, with an estimated global production of 110 million metric tons in 2021 . However, the demand for pork varies significantly across different regions and countries, depending on factors such as income, preferences, culture, religion, and animal health. In this article, we will examine some of the trends and drivers of pork demand in 2021, based on the latest statistics and projections from various sources.
China: The Largest Pork Importer
China is the world’s largest pork producer and consumer, accounting for about half of the global pork output and consumption . However, since 2018, China has been facing a severe shortage of pork due to the outbreak of African swine fever (ASF), which has decimated its hog herd and reduced its domestic production by more than 20 percent . As a result, China has increased its imports of pork and pork products from other countries, especially the United States, the European Union, Brazil, and Canada.
In 2021, China imported a record 5.2 million metric tons of pork and pork products, up 11 percent from 2020 and more than four times the level in 2018 . China’s pork imports accounted for about 37 percent of the global pork trade in 2021 . The main drivers of China’s pork import demand were the high domestic prices, the low inventory levels, the slow recovery of its hog sector, and the strong consumer preference for pork.
Japan: The Second Largest Pork Importer
Japan is the second largest pork importer in the world, importing about 1.3 million metric tons of pork and pork products in 2021 . Japan’s pork imports accounted for about 9 percent of the global pork trade in 2021 . Japan is a net importer of pork because its domestic production is limited by high costs, environmental regulations, and land constraints. Japan mainly imports frozen pork cuts for processing and chilled pork cuts for retail and food service.
The main drivers of Japan’s pork import demand in 2021 were the lower tariffs under the U.S.-Japan Trade Agreement, which came into effect in January 2020, and the increased consumption of home-cooked meals due to the COVID-19 pandemic. The United States was the largest supplier of pork to Japan in 2021, followed by Canada, Mexico, and Chile .
Mexico: The Third Largest Pork Importer
Mexico is the third largest pork importer in the world, importing about 1.1 million metric tons of pork and pork products in 2021 . Mexico’s pork imports accounted for about 8 percent of the global pork trade in 2021 . Mexico is a net importer of pork because its domestic production is insufficient to meet its growing consumption, which is driven by population growth, urbanization, income growth, and dietary diversification.
The main drivers of Mexico’s pork import demand in 2021 were the lower prices of imported pork compared to domestic pork, the strong demand from processors and retailers, and the stable exchange rate of the peso against the dollar. The United States was the dominant supplier of pork to Mexico in 2021, accounting for more than 90 percent of its imports .
Pork is a major source of animal protein for many people around the world. However, the demand for pork varies across different regions and countries depending on various factors. In 2021, China was the largest importer of pork in the world due to its domestic supply shortage caused by ASF. Japan was the second largest importer of pork due to its lower tariffs under the U.S.-Japan Trade Agreement and its increased home consumption during the pandemic. Mexico was the third largest importer of pork due to its growing consumption and lower prices of imported pork.
References:
https://www.fas.usda.gov/dlp/circular/2006/2006%20Annual/Livestock&Poultry.pdf
https://www.statista.com/statistics/263979/global-pork-production-since-1990/
https://www.oie.int/fileadmin/Home/eng/Our_scientific_expertise/docs/pdf/ASF/ASF-control-in-China.pdf
https://www.fas.usda.gov/data/china-livestock-and-products-annual-4
https://www.fas.usda.gov/pork-2020-export-highlights
https://www.statista.com/statistics/237619/export-of-pork-in-2008/
https://www.fas.usda.gov/data/japan-livestock-and-products-semi-annual-7
https://www.fas.usda.gov/data/mexico-livestock-and-products-semi-annual-6
https://www.fas.usda.gov/pork-2020-export-highlights
https://www.statista.com/statistics/237619/export-of-pork-in-2008/
https://www.worldstopexports.com/pork-exports-country/
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