Analysts have opined that if China is looking to meet a purchasing threshold from the U.S. based on a dollar amount, it would be better to focus on high value/value added products. Chief among these would be products presently in somewhat of a short supply situation, such as livestock products. Given that beef prices in China have tripled and even quadrupled over the past several years, it would be a prime suspect for increased purchasing. Of course, U.S. beef prices are not as low as Australia’s, in part due to it being a different product since it is corn-fed and fattened. U.S. aggregate poultry prices are generally lower than China’s, though Argentina has a slight edge as a supplier. Even before China’s pork prices sky...
From WPI Consulting
Communicating importance of value-added products
Facing increasing pressure to quantify the value of export promotion efforts to investors, a U.S. industry organization retained WPI to develop a quantitative model that better communicated the importance of exports. The resulting model concluded that value-added meat exports contributed $0.45 cents per bushel to the price of corn, increasing support for that sector’s financial support of WPI’s client. In addition to serving the red meat industry with this type of analysis, WPI has generated similar deliverables for the U.S. soybean and poultry/egg industries.