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Targeting Central/South America for U.S. Pork Exports

While Mexico, Japan, China and South Korea get most of the press regarding U.S. pork exports, Central and South America are emerging markets that are receiving attention as growing destinations for pork from the United States.

Total U.S. pork exports are up a solid 18% in volume and 24% in value through the first four months of 2011, but the pace of growth in Central America and neighboring South America is even stouter – a 24% boost in volume and 34% in value vs. the same period in 2010.

Anticipating the growth potential, U.S. Meat Export Federation (USEF) recently appointed a new representative, Jessica Julca, who will cover South America from a base in Lima, Peru.

“This region is one of the fastest-growing markets for U.S. pork, but we face different kinds of challenges there than in Mexico or other regions,” explains Gerardo Rodriguez, USMEF director of trade development for Central America.

Guatemala is the largest country in Central America by population, but the people are geographically dispersed, so instead of working on promotions at the retail or foodservice level, USMEF focuses its resources on education and training, working directly with importers.

The approach is similar in Honduras where training is focused on importers who typically sell direct to hotels and restaurants. “It is more efficient for us to educate the importers on the quality and value of U.S. pork than to try to reach all the individual entrepreneurs,” Rodriguez says.

In both Guatemala and Honduras, the United States dominates the relatively small but growing markets for imported pork. The United States has exported 7,505 metric tons (16.5 million pounds) of pork to Honduras in the first four months of 2011, accounting for about 95% of imported pork. U.S. pork exports to Guatemala totaled 3,141 metric tons (6.9 million pounds) for the period, which amounts to a 92% market share of imported pork.

The leading target for expanded U.S. pork sales in the region is Panama, which imported $10.4 million worth of pork in 2010. Panama’s stiff duties, ranging from 60 to 70% on most cuts, make U.S. products extremely expensive.

“The minute the free trade agreement (FTA) between the United States and Panama is approved, we are going to be there,” Rodriguez assures.

Under the FTA, the duties will be phased out over 15 years, but USMEF projects that U.S. pork exports to Panama could double by as early as 2016.

With more than six million people, El Salvador is the most densely populated country of Central America and another target for USMEF’s outreach.

“This year we are expanding into both El Salvador and Costa Rica,” he says. “Costa Rica is especially attractive because it has a higher income level than any of the surrounding countries.”

To reach deeper into these new markets, USMEF is hosting a product showcase in Panama on July 28, which will bring buyers in the region together with sellers from the United States.

“This product showcase is the tip of the iceberg of the activities we can envision for the region in the coming year,” Rodriquez says. “It’s a great opportunity for USMEF members to display their products and familiarize buyers from the region with their companies. We have invited buyers from countries throughout the region, including Belize, Guatemala, El Salvador, Nicaragua, Honduras, Costa Rica, Panama and the Dominican Republic, as well as South America.”

Pork Export Recap
U.S. pork exports continued their torrid pace through April. After four months, volume is up 18% to 735,294 metric tons (1.6 billion pounds) valued at nearly $1.9 billion – a 24% jump over 2010.

Mexico continues to be the No. 1 volume market for U.S. pork exports with 173,647 metric tons (382.8 million pounds), ranking second for value at $321 million. Japan ranks a close second in volume, but remains the far-and-away value leader at $616.5 million.

South Korea continues to be the growth story of the year for pork exports as that nation continues to rebound from its struggles with foot-and-mouth disease (FMD). Through April of this year, U.S. pork exports there are up 187% in volume at 97,357 metric tons (214.6 million pounds) and a whopping 245% in value to $239.8 million.

The per-head value of U.S. pork exports set another record in April, reaching $56.99. Exports accounted for 28% of total U.S. pork production in April.

Jim Herlihy
Vice President of Communications
U.S. Meat Export Federation