Why do you never talk about pork imports? That was a recent question from a reader who noted that we spend a lot of time talking on pork and beef exports as well as beef imports but never seem to mention the amount of pork that enters the U.S. market from other countries.

Two reasons: The amount is relatively small and relatively stable. As can be seen from the chart at right, imported pork adds about 4% to U.S. pork supplies while exports now draw 18-20% of U.S. pork supplies out of the U.S. market. In addition, where exports are still on a definite uptrend, imports have stayed within the range of 3 to 6% of total U.S. production each year since 1988.

This chart also illustrates one of the major shifts in world meat trade over the past 30 years — the shift of the U.S. from being the world’s largest pork importer in the mid-1980s to being the largest pork exporter today.

When anyone considers pork imports, he/she is primarily dealing with shipments from one country: Canada, which has accounted for roughly 80% of U.S. imports since 2000. Those shipments have amounted to only about 3% of U.S. production in the past three years and have actually grown a bit after several years of decline. Denmark is the next largest source of U.S. pork imports with ribs being the major component of those shipments. We understand that Europeans just do not eat pork ribs — and we Americans are glad of it! Denmark has, for several years, been an important source for lighter-weight spareribs and backribs (produced when loins are boned) preferred by foodservice operations. That role has grown more important as U.S. market hogs—and their ribs! — have gotten progressively larger.

When U.S. pork exports were at their peak in the 1980s, European countries were a much more important source of product. Denmark shipped over 345 million pounds of pork to the U.S. in 1987. Poland shipped 125 million pounds that year while Canada, which now consistently supplies over 600 million pounds to the U.S. market, shipped only about 500 million pounds. That number actually declined in the mid-1999s before growing steadily as Canada’s hog sector grew after 2000.

Total U.S. pork imports have stabilized the past three years at roughly 800 million pounds, carcass weight. USDA’s February estimate for the final 2010 figure was 880 million pounds, up 5.5% form 2009. Their February forecast for 2011 is 920 million pounds, representing a 4.5% annual increase. Central to any increase will be output in supplying countries and the value of the U.S. dollar. Canada’s output declines have slowed and may actually end this year, making some growth in pork exports possible. While one would not expect the dollar to strengthen much relative to the Canadian dollar given the flow of Canadian oil southward, we can hardly believe the Canadian dollar will gain much more strength. Save for one spike to $1.076US in November 2007, the Canadian dollar is right at its historic highs. Forecast data for individual countries in the EU-27 are hard to come by but USDA expects the block’s pork production to decline by 130,000 metric tonnes (0.6%) in 2011. The relative value of the U.S. dollar and the Euro is primarily a function of whether more EU countries face sovereign debt crises this year — and we doubt that such problems are over yet.

Spource: CME Daily Livestock Report