International Markets Committee Reviews Beef Export Results, Approves Resolution on TPP

USMEF leadership and staff played a prominent role in last week’s meeting of the cattle industry’s Joint International Markets Committee in Nashville. USMEF Chairman Danita Rodibaugh, a pork producer from Rensselaer, Ind., offered welcoming remarks to the committee and reviewed the record-large export results from 2011. She noted that beef export value would eclipse $5 billion for the first time ever, even though Japan and South Korea are not back to pre-BSE levels and Mexico is still down from its peak of 2008.

“By diversifying our markets, we reached record highs in 20l1 without fully recovering our previous levels in these key markets,” Rodibaugh said. “That tells me we still have substantial opportunities for further growth of beef exports.”

Dan Halstrom, USMEF senior vice president of marketing and communications, updated the committee on the status of key markets such as the Middle East, which has a growing middle class that is seeking higher-quality proteins; the ASEAN, which offers excellent growth potential but a variety of market access challenges; and Central and South America, where growth is already very strong but should see further expansion as a result of newly ratified free trade agreements. Halstrom said the industry has made great progress in reducing BSE-related restrictions, but lingering barriers such as Japan’s 20-month cattle age limit and bans on certain offal products are still costing the U.S. industry significant sales opportunities.

Max Covaliu, corporate chef for USMEF-Mexico, presented examples of promotional programs that help position U.S. beef for success in Mexico and other Latin American markets. He explained that Mexico does not require country-of-origin labeling in the retail meat case, but USMEF prominently identifies U.S. products because of their strong reputation for quality and consistency. Chef Covaliu also reviewed recent Christmas retail promotions featuring U.S. beef and provided an overview of USMEF sales force training programs and other educational efforts aimed at expanding beef sales.

USMEF Economist Erin Borror followed with an explanation of how the U.S industry endeavors to export all beef cuts to the market that offers the best price, and illustrated the added carcass value exports are delivering to U.S. producers.

“Through exports, we’ve been able to spread value across the entire carcass instead of being so heavily weighted on the middle meats,” Borror said. “That’s been especially beneficial at a time when U.S. consumers’ ability to pay for middle meats has been struggling. We’ve added more value to the chuck, round and short plate items and that increase, per head, was around $188 on the whole cutout. Those items accounted for about 50 percent of the Choice cutout value, while the middle meats were just 44 percent. So again, it really comes down to maximizing that carcass value.”

Greg Hanes, USMEF assistant vice president for international marketing and programs, discussed the status of the current international marketing authorization requests (ARs) funded by the Beef Checkoff Program. He focused specifically on the promotional activities and consumer research taking place in Japan and South Korea, but also discussed emerging markets such as the Caribbean and Central and South America.

The meeting concluded with approval of a resolution supporting U.S. participation in the Trans-Pacific Partnership Agreement (TPP) - a proposed multilateral trade agreement that currently includes the United States, Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam, but which has also drawn interest from Japan, Canada and Mexico. However, the resolution supported entry into the TPP on the condition that all participants remove trade barriers and embrace science-based import standards for beef.

Another action taken by the committee was reaffirmation of a staff directive - which had first been approved at the 2011 Cattle Industry Summer Conference - urging the U.S. Trade Representative to forego an appeal of the recent WTO ruling on country-of-origin labeling.