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BEEF CHECKOFF NEWS How Imports Add Value to American Beef Reprinted with permission from Drovers. By Greg Henderson, Editor Without imported lean trimmings, cow slaughter would need to double The U.S. is the fourth-largest global exporter of beef in volume, with the past two years producing total export revenues, in excess of $8 billion per year. That ads $320 to the value of every U.S. fed steer and heifer. The U.S. is also the global leader in beef imports. Those two facts seem incompatible to many. Why, critics ask, does the U.S. import beef? The coronavirus disruption caused historic slowdowns at packing plants leaving thousands of cattle without a final home, abruptly ending the import of beef, however, is not a remedy for the disruption caused by COVID- 19 and would only further reduce the value of U.S. cattle. Gregg Doud, chief agricultural negotiator in the Office of the U.S. Trade Representative, offered his perspective on imports during a webinar sponsored by the Oklahoma Cattlemen’s Association.
OCTOBER 2020
“Advocates claim that if you decrease imports that decreases the supply of beef in the U.S., which raises the price of cattle. That’s a fair point,” Doud says, “except, name me another industry that gets ahead by shrinking their industry. If you shrink your industry, how are you
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going to compete with (other proteins)? Shrink your industry, and you will need fewer packing plants, not more.” Indeed, analysts say beef imports actually add value to U.S. beef. “To understand beef imports in the U.S. you have to understand the hamburger market,” says Oklahoma State University agricultural economist Derrell Peel, speaking during the May webinar. “Ground beef consumption in the U.S. is about 26 lb. per capita, which is about 45% of our total beef consumption.” Satisfying America’s taste for hamburger requires the import of beef trimmings. “Despite the common mischaracterization around beef imports, the bulk of imported beef consists primarily of lean beef and/or trimmings,” says Nevil Spear, an analyst and consultant based in Bowling Green, Ky. “Those imports aren’t competitive (apples to apples); they’re complementary (apples and oranges), being blended with 50/50 trim to make salable ground beef.” Peel notes fed steers and heifers produce about 140 lb. of trimmings, which is about 64% lean. To that, processors will add about 190 lb. of lean trim. The domestic source of that lean is primarily cull cows and slaughter bulls. Imports are the other source of lean trimmings that make up the U.S. total, producing about 334 lb. of ground beef per carcass for an average 79% lean ground. “Put it all together, ground beef production represents a little bit over 30% of total beef production in the US. Imported beef makes up about 26% of that total ground beef production,” Peel says. Yet, without imported lean, Peel said the U.S. would need to double domestic cow slaughter to generate enough lean trim to satisfy domestic demand for hamburger.
