A regular monthly column written for Beef Central by US meat and livestock industry commentator, Steve Kay, publisher of US Cattle Buyers Weekly

One of my more fascinating experiences during my annual visits to Australia earlier this century was a trip to the Port of Brisbane and my first-ever tour of a huge container ship. The vessel was massive (although I’m sure many are now even larger) and I was in awe of how such a ship was staffed by only 25 people.

The ship of course was in port to be loaded with Australian beef. The beef was likely all frozen lean manufacturing beef and was destined for US ports on the West and East Coasts.

I was fascinated to be reminded how important exports were to the Australian beef industry but also how important that frozen beef was to the US industry to be able to make hamburger patties for dozens of fast-food chains. In short, Australian beef was a key reason why US beef consumption remained as high as it did, even after being surpassed on a per capita basis by chicken.

As Beef Central readers well know, Australian exports globally became increasingly limited in recent years because of herd liquidation due to severe drought and subsequent herd rebuilding. As a result, Australian exports to the US dropped sharply in 2016 and continued to fall to their lowest levels on record in 2022.

But as Beef Central’s Jon Condon wrote last week, Australian exports are rebounding, notably to the US.

That is great news for both the Australian and US beef industries. As Jon wrote, last year’s opportunity to export to the US was severely hampered by the US industry’s own drought at the time, forcing heavy liquidation of its beef cow herd. That phase is now over but the US will be unlikely to start producing more beef for at least two or three years.

US beef production in 2023 is likely to decline by 513,000 tonnes or 4 percent from 2022, says USDA.

It will fall even more dramatically next year. USDA currently forecasts 2024 production at 11.2 million tonnes, down 8.9pc from this year.

The US market will need a big increase in beef imports to satisfy current projected demand

Even after accounting for a decline this year and next year in beef exports, the US market will need a big increase in beef imports to satisfy current projected demand. This is highly positive for the many countries that send beef to the US. Key will be expected increases in imports from Australia, New Zealand, Canada and Mexico.

With this in mind, USDA’s Economic Research Service (ERS) has just published a report about beef imports.

Growing demand for cuts over trimmings for grinding beef

Conventional wisdom holds that the majority of US beef imports are boneless manufacturing trimmings destined for blending with trimmings from domestic steer and heifer slaughter to create a ground beef product, says ERS’s Hannah Taylor.

Most of the ground beef sold at retail is derived from domestic trim, while imported beef is more commonly used in foodservice venues. While it is still true that a large portion of beef imports are comprised of product destined for blending into ground beef, a closer look at the trade data reveals some interesting dynamics about the mix of imported products over time, she says.

Boneless manufacturing trimmings and other product groups that are also likely destined to be blended into ground beef make up the largest share of imports, says Ms Taylor.

Australia, New Zealand and Canada account for the largest share of boneless manufacturing trimming imports. While these have decreased from 636,000t in 2015 to 454,000t in 2022, imports of primals, sub-primals and cuts increased from 439,000t to 546,000t.

Within this growing category, the majority of imports are from North American partners. In 2022, 73pc of import inspections classified as primals and sub-primals originated from Canada. Nearly 70pc of import inspections classified as cuts in 2022 originated from Mexico. Many of these products are cut to certain specifications targeted toward Hispanic markets in the US, she says.

Import data comes from several sources, says Ms Taylor. ERS provides beef import statistics in the Livestock and Meat International Trade Data. The data compiles a specific group of Harmonised Tariff Schedule product codes (HTS codes) pertaining to beef and veal.

ERS provides the data in aggregate form on a carcase weight equivalent (CWE) basis. The source of the data, the Department of Commerce, Bureau of the Census, reports trade data by individual tariff codes on a product weight basis. It is possible to use the data from individual tariff lines to gain a sense of specific product imports. In 2022, there were 59 distinct HTS codes used for beef imports, she says.

Using the ERS CWE conversions on each individual tariff line, the HTS code with the most imports in 2022, at 449,000t (nearly 30pc of total imports), was frozen boneless beef, Ms Taylor said.

The top suppliers of this product were New Zealand, Australia, Brazil, Nicaragua and Uruguay.

ERS has aggregated the HTS codes from 2022 into nine groups. The largest was frozen boneless trimmings, accounting for one third of all imports. These products mostly came from New Zealand, Australia, Brazil and other smaller suppliers.

The unit values for these products averaged around US $2.81 per pound, which matched closely with the average price for 90/10 trimmings in the US at US $2.68 per pound in 2022. The similarity in prices reflects the interchangeability and competition between domestic and imported trim, she says.

• For the benefit of Steve Kay’s many friends in Australia, he’s now well on the road to recovery after a recent health issue. Editor