For a third consecutive year, world beef production is expected to decline. USDA’s Foreign Ag Service forecasted a 0.7% decline in world beef production for 2010, as compared to 2009. Four of the five largest beef producing nations are expected to produce less beef. U.S. beef production is forecast to be down 0.8%.
USDA’s FAS forecast a 14% increase in exports by Brazil, the world’s largest beef exporter. The U.S. (number 3 in world beef exports) is forecast to increase beef exports by 10% due to the stronger than expected economic recovery in Asia. The U.S. is the largest importer of beef in the world and our 2010 imports are forecast lower, despite tighter domestic supplies, as Asian markets will likely bid aggressively for Oceania and Uruguayan product.
One question that I often get asked is “why does the U.S. continue to import beef?” The simple answer to this question is that not all beef is the same. One set of animals can produce a vast array of different products of different qualities. These products may not match the preferences of the domestic consumer. U.S. beef demand is largely for ground beef and steaks. Steak demand is oriented toward high-quality middle meat cuts, but ground beef can be made from a wide variety of lean meat.