USMEF Study Identifies U.S. Beef Opportunities And Challenges

Russia                                                                                           

USMEF Study Identifies U.S. Beef Opportunities And Challenges

In the three years that U.S. beef has been absent from the Russian market significant changes have occurred. USMEF recently completed an in-depth study of the market and produced recommendations for U.S. companies that are developing their re-entry strategies.

In February 2007 USMEF conducted 22 face-to-face interviews with Russian importers and retail companies. These interviews confirmed that U.S. beef liver exports will face a more competitive marketplace than in 2003. Success will depend on quality, shipping time and price. In this context, U.S. companies should be extremely careful when planning their strategies for re-entering the Russian liver market since the return of U.S. livers to the market could trigger significant distortions in prices throughout the protein complex.

Australia is currently the No. 1 supplier of high quality beef to the upper-end foodservice sector, followed by Argentina. Importers, however, reported problems with Australian beef that should help USMEF members reposition U.S. beef. Fifty percent of the respondents cited “lack of a standardized quality” as a shortcoming of Australian beef. A differentiation strategy can position U.S. beef as “consistent, highly marbled and always tender.”

In the medium-term U.S. companies should strongly consider targeting the upper-end retail sector. Modern grocery retailing has grown dramatically in Russia and the growth is expected to continue. Twenty-five percent of the interviewees believe there will be retail opportunities for U.S. high quality beef. Two retail chains specifically said that once U.S. product is available they will be willing to stock it.

Because of the prominent position of less expensive suppliers, U.S. companies will need to develop a quality differentiation strategy, while enhancing the price competitiveness of U.S. beef. Educating customers about the tenderness, quality and consistency of U.S. beef will help the United States enhance its competitiveness vis-à-vis Argentina and Brazil in the upper-end retail segment. USMEF members also should consider introducing new value cuts to make U.S. beef more price competitive with products from Argentina and Brazil. On average, the prices of some of these cuts are considerably below that of U.S. beef rib-eyes and tenderloins.

For more detailed information, the USMEF Russian Market Report is online.

Russia                                                                                           

USMEF Study Identifies U.S. Beef Opportunities And Challenges

In the three years that U.S. beef has been absent from the Russian market significant changes have occurred. USMEF recently completed an in-depth study of the market and produced recommendations for U.S. companies that are developing their re-entry strategies.

In February 2007 USMEF conducted 22 face-to-face interviews with Russian importers and retail companies. These interviews confirmed that U.S. beef liver exports will face a more competitive marketplace than in 2003. Success will depend on quality, shipping time and price. In this context, U.S. companies should be extremely careful when planning their strategies for re-entering the Russian liver market since the return of U.S. livers to the market could trigger significant distortions in prices throughout the protein complex.

Australia is currently the No. 1 supplier of high quality beef to the upper-end foodservice sector, followed by Argentina. Importers, however, reported problems with Australian beef that should help USMEF members reposition U.S. beef. Fifty percent of the respondents cited “lack of a standardized quality” as a shortcoming of Australian beef. A differentiation strategy can position U.S. beef as “consistent, highly marbled and always tender.”

In the medium-term U.S. companies should strongly consider targeting the upper-end retail sector. Modern grocery retailing has grown dramatically in Russia and the growth is expected to continue. Twenty-five percent of the interviewees believe there will be retail opportunities for U.S. high quality beef. Two retail chains specifically said that once U.S. product is available they will be willing to stock it.

Because of the prominent position of less expensive suppliers, U.S. companies will need to develop a quality differentiation strategy, while enhancing the price competitiveness of U.S. beef. Educating customers about the tenderness, quality and consistency of U.S. beef will help the United States enhance its competitiveness vis-à-vis Argentina and Brazil in the upper-end retail segment. USMEF members also should consider introducing new value cuts to make U.S. beef more price competitive with products from Argentina and Brazil. On average, the prices of some of these cuts are considerably below that of U.S. beef rib-eyes and tenderloins.

For more detailed information, the USMEF Russian Market Report is online.