The bizarre scene on the massive cargo ship played out as if Noah had cared only about livestock, says Blair Mickelson, co-owner of 50X Cattle, a livestock brokerage in Melba. Fifty-thousand sheep bleated in the storage area. Ten thousand Angus and Hereford bulls shared the voyage.
“You can’t wrap your mind around it until you see it,” Mickelson says. “This exporting deal isn’t for the faint of heart.”
Mickelson was observing rather than brokering on this particular ship, which was preparing to depart from Australia for Jordan. But Mickelson says more Idaho livestock are loaded onto ships and airplanes from both coasts than ever before, a trend he sees increasing in the next five years. The upswing is already underway for other Idaho agricultural products: The state shipped nearly $2.4 billion in ag exports in 2012, more than twice as much as in 2006, according to the Idaho Department of Agriculture.
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The department works with the Commerce Department to find overseas business partners for Idaho businesses. Commerce operates trade offices in Taiwan and China; Agriculture’s Market Development Division runs an office in Mexico. The offices organize trade missions with the governor’s office and arrange meetings on behalf of Idaho businesses. They peddle Idaho ag wares at trade shows throughout their regions.
Laura Johnson, bureau chief of Agriculture’s Market Development Division, says Idaho exporters are taking advantage of improving technologies to extend times for perishable ag products. For example, new bags delay cherries from ripening. Most of Idaho’s exported cherries are still flown, but the bags make it feasible to ship via water, which is cheaper.
Improving economies in China and other Asian countries have created new markets for Idaho exporters, Johnson says. Exports to South Korea, the country spending the third-most on Idaho ag exports, more than doubled from 2012 to $78.5 million in 2014.
Led by whey and cheese, dairy is Idaho’s largest farm-export sector. While fresh milk lacks the shelf life needed for long-distance shipping, cheese has it.
“Cheese is growing as an export into some Asian markets that weren’t traditionally cheese consumers,” Johnson says. “Now, we see Pizza Hut in China, or cheese on a hamburger and other western-style foods.”
Live animals – which Mickelson traffics in – are still a bit player compared to dairy, potatoes and other leading Idaho export products. But Mickelson says the growing appetite for red meat in Asia and elsewhere will drive sales. He has brokered cattle deals to Russia – a market that now is all but closed because of trade sanctions and international politics – and one to Thailand. He expects to fly 185 cattle to Thailand this fall.
Cattle exports come at a premium, Mickelson says. They cost $1,500 to $2,000 per head to ship via jet, and while he doesn’t know what price the final buyers are paying, he says it must be enough for the producer, broker and exporter involved in such deals to make a profit. And in 2014, that came when domestic beef prices were at an all-time high.
2015 EXPORT DIP
Idaho’s five-year run of setting records for farm exports is likely over, thanks to a shipping slowdown caused by a labor dispute. Dockworkers loading and unloading container ships at 29 West Coast ports reduced work crews as the International Longshore and Warehouse Union negotiated a contact with the Pacific Maritime Association.
Shipping containers waited for days and weeks instead of being loaded on ships and delivered. Many of those holding produce were returned to Idaho producers to avoid spoilage.
The labor dispute started in late 2014 and ended when the parties signed a new five-year agreement in May. As a result, Idaho ag exports in the first quarter of 2015 fell 22 percent compared with the year before, Johnson says.
Business is returning to normal for Idaho exporters, Johnson says, but she fears the same problem may return when the labor deal expires.
“There’s real concern that, next time, we’ll be in the same boat again,” she says.