Selling U.S. beef to the world

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At a gathering in Denver this week, U.S. Meat Export Federation (USMEF) regional directors updated USMEF international staff members and guests on programs and progress for meat exports around the world. Overall, the outlook for 2013 beef exports is positive, although challenges remain in some countries.

Mexico and Central America

The NAFTA agreement allows excellent market access in Mexico, and the country is the volume leader for imports of U.S. beef, pork and lamb. Over the past year, Mexico eased restrictions on imports of certain beef cuts and now is open to virtually all U.S. beef from cattle 30 months of age or younger.

USMEF staff historically has worked directly with retailers and large importers in Mexico to build demand for U.S. beef. They recently have expanded their efforts to include smaller markets and grocery chains. About 400 grocery stores in Mexico voluntarily identify and promote U.S. beef at the point of sale, building customer loyalty for U.S. products.

The Mexican market has been difficult for U.S. beef in recent years due to the economic downturn, which has hit the country hard since 2008. The monetary exchange rate makes U.S. beef expensive compared to competing meats, and many Mexican consumers are turning to less costly proteins.

In Central America, the 2012 free trade agreement with Panama will bring progressive reductions in tariffs for U.S. beef. In addition to Panama, Guatemala and El Salvador have significant potential for U.S. beef exports.

Europe, Russia and the Middle East

U.S. beef has a good reputation in Europe, and exports did well during 2012 in spite of disruptions in the European economy and stiff competition from lower-priced beef from Brazil and other exporters. Economic factors probably will limit gains in exports to Europe this year, but USMEF hopes to at least maintain current levels.

Russia joined the World Trade Organization in 2012, and part of the agreement was for higher country-specific quotas for beef imports. In the long-term, the agreement should be positive for U.S. beef exports, but Russia recently imposed a ban on beef from cattle fed ractopamine, which largely cuts U.S. beef out of the market.

USMEF notes significant progress in the Middle East, with beef exports up 20 to 25 percent to some countries. Egypt imports about 100,000 tons of beef variety meats annually, mostly livers. Exports of muscle meats also have increased to Egypt, Saudi Arabia and the United Arab Emirates. Saudi Arabia, however, shut down imports of U.S. beef following the BSE case in a California dairy cow in April 2012.

Asia-Pacific region

USMEF expects a good year for beef exports to Asia. The region accounts for 40 to 45 percent of our beef exports and set a record for value of imported U.S. beef last year. Volumes of beef exports to Asia however, were down somewhat in 2012.

Exports to Japan were flat last year, but it appears likely Japan soon will drop its requirement that U.S. beef comes from cattle 20 months of age or younger, shifting to the more commonly accepted standard of 30 months. USMEF VP for the region, Joel Haggard, says the change will be very positive for the U.S. beef industry. Japanese meat buyers, he says, are ready to buy more U.S. beef.

The April case of BSE went largely unnoticed in the United States, but South Korea shut its borders to U.S. beef for three months, putting a significant dent in our 2012 exports to that country. South Korea also promotes its domestically produced beef heavily, and we also face competition from Australia. Nevertheless, the country has been a growing market for U.S. beef.

Our beef exports to Japan and South Korea are running at just half the volume we sent them prior to the first U.S. case of BSE in 2003, so potential for growth remains.

Taiwan for a while in 2012 banned import of beef from cattle fed ractopamine, but eventually backed off and now adheres to international, science-based residue standards. Haggard says the issue was largely a political one during Taiwan’s election season, and most of the country’s consumers recognized it as such. USMEF expects growth in beef exports to Taiwan this year.

Hong Kong also is a growing market for U.S. beef, and Haggard notes that fast-food restaurants in Hong Kong, a market segment traditionally dominated by Australian beef, have begun using more U.S. beef.

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