In spite of last week’s great news regarding record-breaking pork exports, some new realities will likely take some luster off U.S. meat and poultry export figures in months to come, according to the Chicago Mercantile Exchange Daily Livestock Report.

Anecdotal evidence from industry participants leads them to believe that exports for May and perhaps June will not be nearly as strong as they were in April. The primary culprit is shipping patterns and the related issue of shipping containers. Shipping firms have apparently found more profitable products for their services in recent months, especially with the low value of the U.S. dollar. Their response to these more lucrative routes and lower imports have created a shortage of containers which is a driver of higher frozen meat and poultry inventories the past two months.

U.S. export customers find themselves in the unenviable spot of owning frozen goods in U.S. warehouses and having no containers in which to put them. The inability to convert inventories to cash is already having major impacts on export customers’ liquidity levels. These issues will be solved as U.S. shippers pay more for services – but it will take awhile for those increases to filter through the market.

Source: ThePigsite.com