A brilliant display board depicting succulent U.S. meat greets more than 900,000 Japanese commuters who walk through Tokyo’s Shinagawa subway station each day.
Mike Foley, lieutenant governor of Nebraska, said the display board is just one of the ways the U.S. beef and pork industries are showcasing their products in one of the United States’ most important export markets.
Japan represents the No. 2 volume and No. 1 value market for U.S. pork exports, Chris Hodges, chief executive officer of the National Pork Board, said in discussing the importance of resolving the Trans-Pacific Partnership (TPP) trade agreement.
“The first half of the year, exports were down to Japan,” Hodges said. “We started the year with some really rough sailing with the West Coast slowdown and remnants of PEDv and, frankly, an onslaught of EU pork.”
The European Union took advantage of a slowdown in U.S. pork exports to build market share in Japan, Hodges said.
“I would call this a fistfight with the Europeans. They are not going to give up the market share they claimed at the beginning of this year, so the infrastructure that we have developed has got to come through for us,” Hodges said.
In that regard, Hodges said, the National Pork Board has voted to approve supplemental funding to increase its efforts to build market share in Japan. The European Union has also ramped up its spending on marketing efforts in Japan.
The U.S. trade delegation of producers and agriculture leaders, organized by the U.S. Meat Export Federation, spent several days meeting with key players in the Japanese infrastructure system of importers, distributors, retailers, processors and other food industry professionals. The delegation also had the opportunity to speak with consumers. On Friday morning, Hodges, Foley and two other representatives from the delegation spoke with media about the just-concluded trade mission, during a conference call from Tokyo.
Several Nebraska farmers and ranchers were part of the delegation, which Foley said was important because the Japanese people like to know the story behind their food. And who better to tell that story than the producers themselves.
The delegation also had the opportunity to convey that “PEDv is well behind us and pork production is trending back up, so concerns customers had regarding a reliable supply should be allayed,” Hodges said.
Japan is a country of 120 million people with a hunger for U.S. agriculture products, Gary Marshall, chief executive officer of the Missouri Corn Merchandising Council, said.
“Some people say the Japanese economy is stagnant … but there is still a lot of disposal income, so Japan still represents a tremendous market for us,” Marshall said.
In an effort to expand its market share, Hodges and the other panelists said it is important to get the TPP agreement signed.
Pacific Rim trade ministers from the 12 nations negotiating the Trans-Pacific Partnership, which would stretch from Japan to Chile and cover 40 percent of the world economy, fell short of a deal in late July but were confident an agreement was within reach.
The Japanese are interested in seeing the deal completed this fall, before upcoming elections in Canada and the U.S. could slow or stall negotiations, Hodges said.
“The structure is as we expected – there will be a metered transition over a 10-year period,” Hodges said of lowering tariffs. “Initially, the impact will be somewhat minimal for the first two or three years, but I think we will see a greater range of products coming into this market, including processed meet.”
Tariffs on beef also are expected to decline through the trade agreement.
“I think from a (beef) industry perspective, we are at a disadvantage to Australia (in the Japanese market), and we’d like to see that taken care of,” John Anderson, deputy chief economist of the American Farm Bureau Federation, said.
The beef industry is somewhat constricted by supply, but the situation should improve with the industry currently in the herd rebuilding mode, Anderson said.
Anderson pointed out the U.S. beef and pork industries remain strong in Japan.
“It’s not that we’re not competitive now. Japan is one of our biggest markets for beef and pork,” Anderson said. “We have a big presence in the market, but what we don’t want to see is our position degraded. We want to maintain and improve our competitive position.”
The prospects for growing market share on the island nation are good, the panelists said.
The attitudes of Japanese consumers are changing, as a culture which primarily thrived on fish and seafood for hundreds of years is now demanding more and more meat, Marshall, the Missouri corn industry representative, said.
U.S. meat products are being touted in Japanese editions of magazines like Glamor and Vogue as consumers are finding it fashionable to marry U.S. meat with wine and beer, Marshall said.
China’s currency woes had little effect on the Japanese yen, some of the panelists said, referring to Japan’s economy as stable and the outlook for export growth from the U.S. to Japan good.
“The Japanese market is very focused on quality and very exacting standards,” Anderson said. “The U.S. is well-positioned to meet those standards and provide an attractive product.”