USDA Economic Research Service Reports Record Beef Export Volume For April & Minimal Impact From JBS Foods Cyberattack

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April marked the second month in a row where the U.S. exported record volumes of beef, according to the U.S. Department of Agriculture Economic Research Service. Export beef volume reached 287 million pounds in April, up 22% from 2020 and up 18% from 2019. Exports were boosted by larger year-over-year beef shipments to countries like South Korea (where beef imports set a record for the month of April), China (over 49 million pounds in April), and Mexico (up 81% YOY). The USDA also raised its 2021 forecast for beef exports to 3.342 billion pounds, a 13% estimated gain over last year and 10% above 2019.

Cyberattack Disruption Only Temporary

The highly publicized cyberattack on JBS Foods, which resulted in the temporary closure of nine plants, proved to be only a short-term disruption to beef production. Furthermore, the USDA says that cattle slaughter is typically lower around Memorial Day (JBS Foods temporarily closed its facilities the day after Memorial Day), and per usual post-holiday scheduling, Saturday slaughter efforts were elevated to make up for lost production. Compared to the week after Memorial Day in 2020, cattle slaughter totals were up from 527 thousand head to 538 thousand head.

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In April, China surpassed Mexico to become the third-largest destination for U.S. beef exports. (Image courtesy of USDA.)

2021 Beef Production Forecast Trends Slightly Up

The USDA Economic Research Service raised its annual beef production forecast by 5 million pounds from last month, increasing the expected total to 27.9 billion pounds. The higher production numbers are based on the positive pace of beef cow slaughter for May, up 6% from May 2020 and 7% above May 2019—results that are largely offset by lower steer and heifer slaughter expected for the second quarter.

Beef Prices Higher

Based on numbers from the National Weekly Boxed Beef Cutout and Boxed Beef Cuts report, Choice and Select boxed beef prices were up $40 and $32 YOY, respectively, per hundredweight (cwt). The average price for all grades of live steers (those sold in the five-area marketing region) were up 7% YOY at $119.37 cwt. The USDA, in turn, slightly raised its second-quarter forecast price to $120 cwt (up $2) and the third-quarter price to $115 cwt (up $1).

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Elevated Saturday slaughter totals helped beef production to recover from Memorial Day and the temporary JBS Foods plant closures. (Image courtesy of USDA.)

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Source: USDA