Daily livestock report apr 12 2013
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  • 1. Sponsored by Vol. 12, No. 69 / April 12, 2013 As a larger share of US meat production goes to other metric ton Flow of US Beef Into Mexico, 3-Month Moving Avg. prod. wt.markets, the pace of export and import shipments becomes Data presents flow into Mexico as seen from US export Data and Mexico Import Statisticsa critical demand driver. The official statistics for US beef, 20,000pork and poultry exports are released each month by the US Cen- 18,000sus Bureau. The Census data collection is consistent with the 16,000Harmonized Commodity Description and Coding System which is FAS Weekly 14,000used by most countries. USDA reports the Census statistics asthey are released through its GATS interface and it also reports 12,000 Mexico Importsthem on a carcass weight basis, using specified conversion factors. 10,000The reason for converting to a carcass weight equivalent is so as to 8,000 US Census (official)make them comparable with the production statistics which arereported on a carcass weight basis. The monthly statistics are 6,000reported with a significant lag (consider the amount of data Cen- 4,000sus needs to process). For instance, February export statistics 2,000were released on April 5 and the March report will be releasedMay 2. - In addition to the monthly export statistics, we also get 2010 2011 2012 2013an early read of export numbers for fresh/frozen beef cuts metric ton US Exports of Fresh/Frozen Beef, MT, Shipped Basisand, more recently, pork through USDA’s Export Sales Re- shipped wt. Comparison of Monthly Official Census Data and Weekly USDA Export Statisticsporting system (ESR). The weekly report is normally thought 90,000to be more volatile, given how the various companies that report Weekly Report Monthly Reportinto the system, submit their data. Also, the weekly export data 80,000tabulated on a monthly basis are not expected to be exactly thesame as what the Census reports given differences in coverage 70,000and compliance rate. Still, the expectation is for the numbers,over time, to consistently match, if not in actual volumes, in thegeneral trend. We have often reported on the weekly export sales 60,000for beef, considering them an early indication of what the finalofficial export data was likely to say. In recent months, however, 50,000that parallel between the weekly and monthly numbers hasbecome increasingly more difficult to make. We do not claim 40,000to be specialists in this field and among our readers there aresome that are far more qualified to address this issue. However,we think it is appropriate to at least flag this issue. 30,000 Consider the first chart to the right. It outlines the trend 2010 2011 2012 2013in US beef flow into Mexico, one of our most important beef trad-ing partners. You can look at the flow from the Mexico side, which year, the weekly export report had US exports up 19% while theis Mexico imports of US beef or you can look at it as US beef ex- US Census export statistics showed a 36% decline. The secondports, using either the weekly export data or the monthly export chart compares the monthly official statistics on US fresh/frozendata (Aside: We converted the weekly export numbers by calculat- beef exports (red bars) vs. the implied monthly exports using theing the average daily shipments and then totaling the daily aver- weekly system (light green). The relationship between these twoages into a monthly number). The chart above shows a dramati- statistics has dramatically changed since 2012 and the only thingcally different picture depending on what kind of data you we can think of is the change in Harmonized System codes thatare using. Due to the month to month variability, we used a 3- went into effect...January 2012. We welcome any other insightsmonth average to smooth it out. In January, the three month av- but, in the meantime, note the growing discrepancy when reading/erage Mexico imports of US beef were up 3% from the previous analyzing the monthly and weekly export statistics. The Daily Livestock Report is made possible with support from readers like you. If you enjoy this report, find if valuable and would like to sustain it going forward, consider becoming a contributor. Just go to www.DailyLivestockReport.com to contribute by credit card or send your check to The Daily Livestock Report, P.O. Box 2, Adel, IA 50003. Thank you for your support!The Daily Livestock Report is published by Steve Meyer & Len Steiner, Inc., Adel, IA and Merrimack, NH. To subscribe, support or unsubscribe visit www.dailylivestockreport.com. Copyright © 2013Steve Meyer and Len Steiner, Inc. All rights reserved.The Daily Livestock Report is not owned, controlled, endorsed or sold by CME Group Inc. or its affiliates and CME Group Inc. and its affiliates disclaim any and all responsibility for the informa oncontained herein. CME Group®, CME® and the Globe logo are trademarks of Chicago Mercan le Exchange, Inc.Disclaimer: The Daily Livestock Report is intended solely for informa on purposes and is not to be construed, under any circumstances, by implica on or otherwise, as an offer to sell or a solicita- on to buy or trade any commodi es or securi es whatsoever. Informa on is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied orpossible where projec ons of future condi ons are a empted. Futures trading is not suitable for all investors, and involves the risk of loss. Past results are no indica on of future performance.Futures are a leveraged investment, and because only a percentage of a contract’s value is require to trade, it is possible to lose more than the amount of money ini ally deposited for a futuresposi on. Therefore, traders should only use funds that they can afford to lose without affec ng their lifestyle. And only a por on of those funds should be devoted to any one trade because atrader cannot expect to profit on every trade.