2016 was a record year for U.S. pork exports
Becca Nepple, VP International Marketing, National Pork Board
Don Wick: 00:04 From the Pork Checkoff in Des Moines Iowa, it’s Pork Pod. Pork Pod, a look at the hot topics in today’s pork industry. The Pork Checkoff is working for you through various forms of research promotion and consumer information projects. This is Don Wick, speaking on behalf of the Pork Checkoff, and today our guest is Becca Nepple, who is the Vice President of International Marketing for the National Pork Board. The export numbers are in for the full year of 2016. Looks like we ended on a strong note Becca.
Becca Nepple: 00:33 We definitely saw a rebound in the fourth quarter of 2016 with kind of a slow start and a hard rebound from 2015. And a lot of the rebound in the last quarter was due to Mexican orders for U.S. pork, as well as increase in China orders. So we actually came in in volume up 8 percent from 2015 and that is up 2 percent from 2012 highs. And then value, we’re up 7 percent from 2015. So as you said, we definitely saw a rebound and we’re glad to get some of that market back.
Don Wick: 01:11 So tell me about Mexico. Why do you think we were able to see a resurgence there?
Becca Nepple: 01:21 Definitely an awesome partnership with Mexico, in that they take a lot of our hams. So I think for 2015, it was in between 20 to 30 percent of U.S. produced hams were shipped to Mexico, which they then further process. And they’ve just been a great trade partner and, obviously, the logistics of getting something via truck down to Mexico is a little easier than some of our other markets.
Don Wick: 01:45 Well again exciting for 2016! Obviously a focus as we move forward. What kind of goals do we see from the National Pork Board for the international marketing arena?
Becca Nepple: 02:00 Well in 2015, the Pork Board and the pork industry wrote a strategic plan and the goal was in five years increase exports by 9 percent, in both volume and value, each year over those five years. So right now we’re down on our status of where we want to be. But definitely made some progress in 2016, and feeling confident that as we have a lot of product coming in on our market, that we can use the opportunity we have and a lot of these export markets to ship product to those customers around the world that really desire our product.
Don Wick: 02:39 Obviously we have a large supply. Are there are some things being done to really incentivize some of those purchases?
Becca Nepple: 02:46 Our board of directors has decided to focus on international marketing a little bit more than in the past. And thus, we have an increase of about 12 percent in spending dollars over 2015. This means that we have to work hard on using those dollars and focusing those dollars on not only new markets, but emerging markets, develop markets, and shipping a lot of that product that the domestic consumers won’t consume over the next couple of years.
Don Wick: 03:21 Are there certain things in that game plan to really increase on new markets, existing markets, those kind of things?
Becca Nepple: 03:13 In working with the U.S. Meat Export Federation, we’ve developed sort of a map for how to go about using these dollars effectively for pork producers, and providing opportunity for the exporters. So there’s not really a major shift in strategy. But because there’s more funds available, we’re ramping up activity structure, expanding the scope of some of our promotions in larger countries. And then also, China is a major focus, with the budget for China activities almost doubled versus 2015 and so a huge country, huge opportunity, and working with developing an extended staff there, and focusing a lot on the importers, the processors, and then also in their food service market. In Korea we have a great opportunity with working with a further process sector and shipping a lot of the products that they use domestically and further process products. And then, of course, Japan is our number one value market. We ship a lot of boneless loins there. And so focusing on some of the brand equity we have there. And then Central and South America are just really great potential for U.S. pork, as far as their GDP increasing, they’re increasing in meat consumption, and using a lot of the mix of cuts that we have that they traditionally haven’t used. So trying to promote and work with further processors in Central and South America.
Don Wick: 05:11 You mentioned China off the top. When I look back to 16 breaking new records, really, in moving pork to China, didn’t we?
Becca Nepple: 05:22 Absolutely! A lot of opportunity in China and the statistic that is impressive is if we were to export one more per cent of the Chinese consumption, that would equal 5 percent of our U.S. production. So, it’s a big country. The largest pork consumer in the world and a lot of opportunity there.
Don Wick: 05:42 Becca when I want to talk about the export market, what’s this mean back to the producers and really their investment in Pork Checkoff?
Becca Nepple: 05:49 If we look at all of 2016, the value per head, of the value per hog that is exported, equates to about 50 dollars and 20 cents back to producers. And that means about twenty five point eight per cent of our pork and pork variety meat production is exported. So a very important part of our market for sure.
Don Wick: 06:12 Thanks to you for listening to this edition of Pork Pod. For more information on this topic or the Pork Checkoff itself, visit pork.org.