In normal times U.S. product prices are competitive with much of the high quality red meat, poultry and dairy products in the world.  According to the Foreign Agricultural Service of USDA estimates, for this calendar year among major exporters the U.S. has a 34 percent market share in pork, young chicken meat and turkey and 14 percent in beef and veal.  The share in high quality beef is much higher.  The U.S. milk products export share is 16.4 percent for 2012.

The drought in the U.S. has impacted feed prices around the world and taken some of the cost pressure off the U.S. meat export suppliers.  Industry reports indicate that small hog producers in China are already reducing production because of high prices of imported corn and soybean meal.  That is not a reason to be complacent.  Countries like Brazil, Argentina and Australia are sourcing local feeds at lower costs than the U.S. and will compete aggressively to gain market shares.

The U.S. export companies had a good first half of 2012.  Young chicken meat exports were up 13 percent in volume to 1.8 MMT, while turkey volume was up 11 percent to 166,000 metric tons.  Pork exports were up 5 percent in volume to 1.13 MMT, but beef export volume was down 11 percent to 550,000 metric tons.  Export values were up across all products.

Additional market access could create new opportunities despite higher feed costs.  Beef markets should expand in Taiwan with adoption of international standard for the presence of ractopamine.  Talks continue with Japan on its limit on beef to animals 20 months old and younger.  With Russia now part of the WTO, markets should be more consistent.

U.S. exporters will be challenged over the next 15 months as higher feed prices increase product costs and limit supplies.  Steady markets with a strong U.S. presence in those markets should help U.S. exporters to retain their positions.  U.S. product supplies in those markets are as important to consumers in those markets as to the U.S. companies that supply them.