2020 Global Beef Trade Reflects Production Challenges, Foodservice Struggles

Approaching the end of the third quarter, global beef trade data for 2020 illustrate significant production challenges for major exporters and shifts in demand in key export destinations related to the COVID-19 pandemic

After racing to record pace early in the year, U.S. beef exports slowed dramatically in the second quarter, due in part to interruptions in slaughter as processing plants implemented additional measures to ensure worker safety. Exports rebounded to some degree in July, though production of certain items is still hampered by limited labor availability and demand remains slow in markets where beef consumption is heavily weighted toward the foodservice sector – including Mexico and other Latin American regions. A complete summary of January-July exports of U.S. beef is available from the U.S. Meat Export Federation (USMEF) website.

Australia's exports, which were expected to slow significantly this year due to herd rebuilding, held fairly close to 2019 levels through the first half of the year – dropping about 2% from a year ago to 553,500 metric tons (mt). But June slaughter was the lowest in eight years and June beef production was down 11% year-over-year, leading to a sharp drop in Australia’s July exports to 88,785 mt – down 23% from a year ago and the lowest monthly volume in more than two years.

Just-released August data show an even steeper decline in Australia's exports at just over 78,000 mt, down 27% year-over-year and driving January-August exports 9% lower than a year ago at 720,500 mt. Australia's beef supplies are expected to further tighten through the balance of the year, with exports also constrained by increasing strength of the Australian dollar and softening demand from China.