China’s demand for imported beef is now forecast to grow by a massive 675,000t in 2023 compared with a previous forecast released by USDA in October 2022.
This is based on an anticipated revival in hotel, catering and institutional demand and in spite of the current wave of COVID-19 in the country.
However, the the US department of agriculture (USDA) expects the growth in shipments to be slow as there are considerable stocks built up in cold storage following higher than expected imports in the final quarter of 2022.
The USDA also forecasts that global beef production in 2023 will be in the order of 59.2m tonnes, of which 12.2m tonnes will be traded on international markets.
The sustained growth over the past decade means more than a quarter of this, 3.525m tonnes will be bought by China, with the US the next biggest importer on 1.542m tonnes.
Japan, which is a target for Irish beef exports, is the next largest, forecast to be 805,000t in 2023 followed by South Korea on 610,000t. The markets of particular interest to Irish farmers and exporters, the EU and UK, are the next largest importers of beef on 410,000t and 395,000t respectively.
If China dominates the buying market for internationally traded beef, Brazil dominates the selling. It is forecast by the USDA to export 3m tonnes of beef in 2023, followed by Australia on 1.525m tonnes and the US just behind in third place on 1.4m tonnes.
The other major global exporters are Argentina on 750,000t, New Zealand on 630,000t, Canada on 575,000t and Mexico on 440,000t. EU countries are grouped together in the USDA forecast with a combined 650,000t forecast to be traded outside the EU in 2023.
Global pigmeat production is forecast to reach 114m tonnes in 2023, an increase of 3% on 2022 and the highest in recent years. Consumer demand is forecast to grow in China with the lifting of COVID-19 restrictions to almost 57m tonnes but this will be largely met by the 55m tonnes of domestic production with China’s pork output now fully recovered from the African swine fever disruption.
Its import demand is forecast to be 2.1m tonnes, 3m tonnes less than the peak import year of 2020 when almost 5.3m tonnes of pigmeat was imported by China. Japan, South Korea and Mexico are all forecast to have broadly similar demand to 2022.
The EU is the biggest exporter of pigmeat, forecast to be 3.950m tonnes in 2023, followed by the US on 2.880m tonnes.
Despite underestimating demand from China in 2022, USDA forecasts are among the most reliable predictors of trade patterns available.
Its prediction of a further surge in import demand for beef by China is particularly good news for Irish farmers and exporters with the recent announcement that it is resuming imports from Ireland. What has made China different over the past decade is that it has been an expanding market year on year.
That means that Irish exporters chasing business don’t necessarily have to displace existing business, they can service the new growing demand.
This contrasts with the difficulty in doing business in two of the other major international beef markets opened to Irish exporters over the past decade, the US and Japan.
While both of these are the second and third largest importers in the world, they are basically stable markets with existing suppliers.
Displacing these hasn’t been possible in a significant way for Irish exporters whereas in China, the total market is growing.
Of course, the reality is that the growth in this market has been met so far with rapid growth in Brazilian beef exports making the South American country the largest supplier. Brazil is forecast to continue increasing production so it will also be chasing new markets.
However, the bottom line is that getting access to China now is as good a new market as Irish farmers could get in 2023.
For pig producers, there is no major market growth forecast anywhere and with more global production it looks like there will be plenty of supply.