Agricultural News
U.S. Red Meat Industry Looks East for Future Growth
Thu, 07 Nov 2013 13:01:09 CST
A good number of those in the beef industry are looking toward the East these days-the Far East. At the United States Meat Export Federation's strategic planning conference in Fort Worth, USMEF Senior Vice President Asia-Pacific Joel Haggard said the Asian market is definitely where the action is.
He spoke with Radio Oklahoma Network Farm Director Ron Hays and said that the Asian market has proven an amazing market for U.S. red meat exporters and is poised for further massive increases in demand. He said the reason for increase sales is simple.
"They're just importing more beef and they're importing beef that's more expensive than it was a couple of years ago."
Haggard said the recent growth in the value of the Asian market has been nothing short of exponential.
"I took the value of all the beef imported by the major and even the smaller Asian countries, I added it up and did the same for last year and it looks like this year is going to be, maybe, in the range of $12 billion of total beef imports-not all just from the United States-whereas last year it was $9 billion. They're basically spending $3 billion more on beef imports this year. And then that would have been double from just a few years ago."
He said growth in the Japanese market has been phenomenal and there is still room for further growth.
"Japan has been a great success story-ten percent in one year-from 27 percent to 37 percent. And it's only going to grow as this new access matures and more buyers come on line."
And just where will that growth come from?
"There's still a lot of room to get in retail chains and restaurant chains so it's a question of just aligning supply. You can't just switch, if you have a menu for example in a restaurant, it takes some time to readjust your menu, to readjust your supply and plan the logistics so your restaurant or retail store doesn't run out of products. And that's still happening because this access is relatively new."
Haggard said the South Korea market has been holding its own for U.S. exporters, but Australian beef has been increasingly pushing into that market as more U.S. beef goes to Japan. The real prize that everyone is looking at, however, is China.
"The China story is one of amazing beef demand. It's frightening. Obviously, not sustainable, but this year their imports are up, depending on how you count it, 700 percent over last year. So, they're importing more beef in a month than they were in a year two years ago."
Why?
"Beef demand is growing fast and their domestic herd is short and they like beef. It's traditionally a pork-consuming country, but beef is kind of like a luxury good. People have more money and they want to go out. When they go out to restaurant they don't want to eat pork they want to eat beef."
Beef imports for China are not currently coming from the U.S. The Australians have a 50-percent market share, Uruguay has 25 percent and New Zealand and Canada share the rest, Haggard said.
He said the biggest need of the U.S. beef industry is for the governments of the United States and China to finalize a health protocol that will allow American beef to flow into China.
Click on the LISTEN BAR below to listen to more from Ron Hays and Joel Haggard.
WebReadyTM Powered by WireReady® NSI
Top Agricultural News
More Headlines...
