Beef Quarterly Q2 2019: Changing of the Guard in the Beef Trimmings Market

With growing demand for western-style beef consumption in Asian countries, are we seeing a changing of the guard in the world trimmings market as China, Japan and South Korea start to dominate volume trade for beef trimmings?

image of beef cuts

Download the latest quarterly

Report summary

The world’s largest beef importer, China, is at the centre of growth in beef trade in general, and trimmings trade specifically. Many of the cuts imported by China have been to satisfy the local cuisine. But as diets and foodservice change, this now includes a growing trend in trimmings trade.

The growing demand for trimmings from Asian countries will create additional competition for the US but it is not expected to shift the market yet. Suppliers of trimmings into the global market should be conscious of possible changes in the trade. While steady growth is evident in the Chinese market to date, a short-term demand increase across all proteins as a result of African Swine Fever will likely cause a spike in demand for trimmings.

This is our feature article this quarter. Other headlines include…

Australia: Dry Forces Higher Slaughter

Despite some localised falls of rain through the first five months of 2019, the over seasonal conditions in Australia remain dry, forcing additional cattle slaughter. Slaughter volumes for the first three months of 2019 are up 14% on 2018 volumes. Revised industry forecasts show the national cattle inventory at 26.2 million head, the lowest number for over 20 years.

Brazil: Gradual Recovery

After having registered record levels in 2018, total Brazilian beef exports continue to increase in 2019. During the first four months of the year, exports increased by around 12% by volume against the same period of the last year. While shipments to the EU, the UAE, Iran and Russia presented significant growth rates YTD, China and Hong Kong continued to be the main buyers of Brazilian beef.

China: Beef Prices Remain Strong

Chinese retail beef prices have remained strong for the first five months of 2019. Although the prices dropped a little from the record high seen in February, they remain above RMB 68/kg, the highest price for this season historically.

US: Full of Challenges

US cattle producers suffered through one of the most difficult winters in recent history, and, so far, the cool wet spring with excessive rainfall over the majority of the country has been equally difficult. The late arrival of warm weather has only made things more complicated. Muddy conditions persist in feedyards, corn planting has been severely delayed, and domestic demand remains soft as the cool wet weather has delayed the start of the grilling season.