The soaring Canadian dollar has led to more U.S. pork and beef landing on Canada’s store shelves this year, but the country’s meat exports look stronger despite the currency’s climb, export officials said April 8.
Canada imported nearly 12,000 tonnes of U.S. processed pork from Jan. 1 to March 27, a 43 per cent increase from the same period a year ago.
“What you see (at stores) is lots of U.S. pork being featured,” said Jacques Pomerleau, executive director of Canada Pork International. He said the influx results from the Canadian dollar’s rise to near parity with the U.S. dollar.
Demand for U.S. cured hams has been especially strong, with Canadian imports more than quadrupling to 3,344 tonnes. That demand likely reflects earlier Russian bans on imports from some U.S. pork plants, said Kevin Grier, senior market analyst at the George Morris Centre in Guelph, Ontario.
Beef imports from the United States are up 12 per cent through March 27 to more than 25,000 tonnes, even though overall beef imports dropped 11 per cent.
The surge in U.S. beef arriving in Canada reflects Canadians’ stronger purchasing power due to the rise of their currency, said Ted Haney, president of the Canada Beef Export Federation. The faster economic recovery in Canada versus the United States also makes it an attractive meat market, he said.
“It was expected and has been noted that Canada has become a desired market again for exports, particularly from the United States,” he said.
Canada is the world’s third-largest exporter of pork and beef.
But Grier said he thinks the stronger Canadian dollar affects meat imports, mainly in the longer term.
“(Increased U.S. imports) are primarily because the U.S. industry is getting bigger and bigger and ours is getting smaller and smaller … I don’t buy into the currency being the short-term reason to explain anything.”
The risk with U.S. exporters shipping more to Canada is that greater supplies will weaken prices, but they typically moderate sales to avoid that, Haney said.
Canada has also exported more pork and beef this year.
The outlook for pork exports is improved from a year ago, when China banned Canadian pork in connection with the H1N1 flu outbreak, Pomerleau said. China reopened to Canadian pork in February and pork supply worldwide has declined, he said.
Total pork exports were up 2.7 per cent to more than 86,000 tonnes in January from the same month a year earlier, according to the most recent data available from Statistics Canada.
“Very likely it will remain positive for the end of the year,” Pomerleau said.
The United States, Canada’s top pork export market, imported nearly seven per cent less in January to about 26,000 tonnes.
Total beef exports in January were up seven per cent to more than 34,000 tonnes. The United States was the biggest buyer, importing four per cent more than a year ago.