U'S' Meat Export Federation

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U.S. Meat Export Federation Strategic Planning
Marketing Conference New Member Orientation
Breakfast November 8, 2001
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USMEFs Mission

• To increase the value and profitability
• of the U.S. beef, pork, and lamb industries
• by enhancing demand for their products
• in export markets through a dynamic
• partnership of all stakeholders

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Global in Scope
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USMEF Revenue, FY 2001Total 24.5 Million
Packer/Processor/Purveyor/Trader
Agribusiness/Farm
Soybean
Other
Grain
USDA
Hog Producing
Cattle Producing
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FY01 Revenue

• FY01 total budget is 24.5 million.
• Membership dues and investments by members allow
  USMEF to access USDA funds for market development
  and promotion.
• Access to USDA funds turns every 1.00 into
  1.63.

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Strategic Priorities

• Market Access
• Total Carcass Utilization
• Trade Support
• Market Presence
• Buyer Education Loyalty
• Product Image

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Market Access

• Secure meaningful, sustained access to new and
  existing export markets.
• Working with government industry to identify
  priorities develop negotiation strategies.
• Examples.
• WTO.
• EU Trans Shipment.
• Korea Country of Origin.
• Mexico Inspection Points.

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Total Carcass Utilization

• Maximize returns for underutilized cuts of beef,
  pork, lamb.
• Outlet for red meat items with limited demand in
  U.S.
• Examples
• Regional Chefs Competition Shoulder clod top
  blade top sirloin butt cap muscle.
• MegaBalls U.S.Meatball introduced into the wet
  markets in January 2000. To date, 671,297 kg
  have been sold worth worth more than 5 million.

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Underutilized Beef Cuts An Opportunity to Add
Value
TOTAL VALUE ADDED 710 MILLION EQUIVALENT TO
19.72 PER HEAD
Prices will vary over time. This example
approximates the value of the average price
spread between domestic and export prices for
these items in 2000. Based on 36 million head
slaughtered.
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Trade Support

• Gather and disseminate market intelligence and
  facilitate contact between U.S. exporters and
  buyers in export markets.
• Includes business development teams, newsletters
  trade shows.

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Market Presence

• Increase the presence of U.S. red meat in the HRI
  and retail sectors.
• Examples
• Natures Balance current campaign in 45 chains
  and 4,000 outlet stores nationwide
• U.S. Hams to the Rescue 61 increase in ham
  sales
• American Beef Club

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USMEF Retail Promotions Help Build Market Presence
Retail outlets are taking on a new look in
international markets creating new
opportunities for U.S. red meats.
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Buyer Education Loyalty

• Educate buyers in export markets of the
  attributes of U.S. red meat.
• Build buyer loyalty to products exported from the
  U.S.
• Examples
• Chefs contests.
• Product showcases.
• Trade teams.
• Seminars and training courses.

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USMEF Meat Schools In Seoul Shanghai
Korea MERC
USMEF Meat Schools provides expert instruction
hands-on experience.
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Product Image

• Establish positive images for U.S. beef, pork and
  lamb with consumers in targeted export markets.
• Achieved through advertising, public relations
  consumer events such as cooking schools.
• Position U.S. red meats as versatile, high
  quality, nutritious, safe

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Reaching Consumers
Positioning U.S. red meat with consumers though
print and television.
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U.S. Beef Pork Exports Set Records in 2000
U.S. Beef Pork Exports(1,000 MT)

• U.S. exports of beef and pork topped 1.8 million
  MT valued at 5 billion in 2000.
• Pork exports surged 38 between 1996 and 2000.
  Beef was up 29.
• Japan Mexico are the largest importers of U.S.
  beef and pork.

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Distribution of Pork Pork Variety Meat Exports
2000

• Japan is our 1 export market with Mexico at 2.
• Japan accounted for 58 of total U.S. pork
  exports on a value basis 37 on a volume basis.
  
• The top 3 markets accounted for 86 of total
  value and 78 of total volume.

Exports By Value Volume
Percent
U.S. Department of Commerce/Trade Census Bureau
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U.S. Exports Projected to Expand
USMEF Forecasts of U.S. Beef Pork
Exports (000 metric tons)
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Factors Driving Growth in U.S. Red Meat Exports

• Rising Per Capita Incomes
• Growing Middle Class
• Changes in Diet
• Declining Self-sufficiency in Leading Import
  Markets
• Expanding Market Access
• USMEF/Industry Marketing Initiatives

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Challenges

• Food Safety Issues.
• Foot Mouth Disease.
• Bovine Spongiform Encephalopathy (BSE).
• Animal identification source verification.
• Increasing global competition
• Australia, Brazil, Canada Denmark for pork.
• Argentina, Australia Canada for beef.
• Non-tariff barriers
• EUs hormone ban.
• Non-recognition of FSIS inspection systems.
• High tariffs.
• Trend in Japan to differentiate.
• Barley Wheat fed vs. corn soy.

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Funding for Market Development
Competitors investment in market development is
much larger and has grown faster since Uruguay
Round. Foreign competition spending grew over 50
since URAA
Information source FAS
Foreign Competitors 95 - 98
United States 95 - 99
Note Data includes contributions of both
governments and producer groups. U.S. data
includes MAP FMD and displayed as the first
year of a split year (FY) for comparability
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Opportunities Current Future

• Improved market access.
• Global economic growth.
• Current animal health issues are bolstering U.S.
  position as a safe and high quality meat
  supplier.
• Future opportunity will continue to be in the
  Asian regions and Latin America.
• Half the worlds population and GDP growth to
  2005 will occur in these two regions.
• With 80 of U.S. exports already destined for
  these two regions, the U.S. is well positioned
  for future growth.
• China and Russia to become increasingly more
  important to U.S. pork and beef industries.

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Corn Exports Through U.S. Beef Pork Exports

• 60 of the corn produced in the U.S. is utilized
  as livestock feed.
• As beef and pork exports increase so does the
  level of corn exported in the form of value-added
  U.S. beef and pork.

Corn Exports Through U.S. Beef and Pork
Exports(million bushels)
Pork
Pork
Beef
Beef
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Growth in Red Meat Exports Increased Domestic
Demand for Corn
Corn Exports Through U.S. Beef Pork Exports
(million bushels)
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USMEF Thanks You For Your Support