A Look At International Markets Shows Challenges and Opportunities For U.S. Meat Exporters...

Strategic planning was on the minds of U.S. Meat Export Federation (USMEF) members gathered at the federation’s Board of Directors Strategic Planning and Marketing Conference Nov. 3-5 in Albuquerque, N.M.

To summarize strategies and tactics proposed by directors of USMEF’s international offices, three market forums were held to discuss the challenges and opportunities in three major regions of the world: Asia-Pacific, Western Hemisphere and Europe-Russia-Middle East. 

As international economies and incomes rise, so do opportunities for U.S. beef and pork producers to export meat. The success of these opportunities is dependent on market access and understanding international culture.

Western Hemisphere     

Many markets closed to U.S. beef last December due to a single case of BSE reported in Washington State, resulting in a 78 percent export volume loss to the beef industry. But markets in the Western Hemisphere were some of the first to reopen, including Canada, Mexico, many Caribbean islands and Central American countries.

Mexico has become the largest market for U.S. beef exports as the United States holds an 86 percent share of the country’s beef import market and an 80 percent share of its pork import market. With Mexico’s population and per capita income rising and a reduction of land available for livestock and agriculture, red meat imports are expected to rise.

USMEF capitalizes by educating retailers and consumers on the wholesomeness, safety and nutritional value of U.S. beef. The ¿Cómo Como? campaign recently introduced in Mexico asks the question, “How do I eat?” and answers by showing a middle-class family enjoying U.S. beef for dinner to emphasize U.S. beef is healthy, tasty and fresh.

El Cerdo es Bueno or “Pork is Good,” positions U.S. pork as a healthy and safe protein option for use in everyday and traditional family recipes. The campaign includes a brochure distributed at retail stores featuring popular and traditional Mexican dishes prepared with U.S. pork.

USMEF also sponsors a chef competition each year in an effort to teach the restaurant sector about less expensive U.S. beef and pork cuts and how to incorporate them in their meal plans. The competition is a must for serious chefs and winning is esteemed a signal honor.

Asia

Although Mexico is now the largest importer of U.S. beef, Japan imports the most U.S. pork. U.S. pork trade is up three times the worldwide average at 32 percent.

USMEF promotes pork to Japanese consumers using a Pork Caravan that travels to retail stores identifying the quality, taste and safety of U.S. pork. The caravan provides educational materials and U.S. pork samples to consumers. Stores visited by the caravan experienced a five-fold increase in sales.

Japan is expected to reopen its market to U.S. beef by early 2005. USMEF estimates at least two years for exports to return to pre-BSE levels. USMEF has provided scientific information to aid in trade negotiations and will work in restoring consumer confidence in U.S. beef by reintroducing it to the market, providing education on U.S. beef safety, and organizing retail promotions.

Taiwan and Korea are expected to open their markets to U.S. beef while Egypt has already done so to limited imports. Taiwan announced on October 20 the conditions of reopening its market, including sending a technical team to visit the United States to observe U.S. processing, ensuring U.S. beef quality and safety.

With pork, the United States holds 58 percent of the import market share in Taiwan valued at over $19 million. Taiwan imports variety meats like brisket bones, bungs, feet and kidneys for traditional dishes. These variety meats have a higher value when exported since they are unpopular in the United States.

Animal diseases affecting other species, such as BSE and Avian influenza, have encouraged pork consumption worldwide. In Korea, exports of U.S. pork are up 57 percent due to beef concerns, decreased domestic meat production and a growing retail sector. Koreans are dining out at Western restaurants, such as TGI Friday’s and Outback Steakhouse, increasing the demand for U.S. meat.

Korean beef imports are expected to reach 70 percent of pre-BSE levels by 2005. Due to increasing demands by other markets, availability will be a key issue when the market opens.

Avian influenza and SARS have also impacted meat consumption in China, making consumers more safety conscious. USMEF educates decision makers on the certification process necessary to re-enter the market.

Strong economic growth, large populations and a decline in domestic pork production have increased prices for pork in China. USMEF targets retailers by promoting U.S. pork for use in traditional dishes like hot pot, a popular winter dish.

In Southeast Asia, the Philippines, Indonesia and Vietnam are open to U.S. beef. Offal is a good protein filler for processors and chef training sessions are held to identify new cooking methods and muscle cuts. U.S. pork is used as a source of raw material for processing.

Increases in U.S. pork exports to the Philippines have boosted United States totals to the ASEAN region, up 37 percent in quantity and 61 percent in value through September.

Europe, Russia and the Middle East

USMEF is also looking at the European Union for meat exports since it is the world’s most affluent trading block and has a dwindling beef supply due to the reform of the Common Agricultural Policy, which is driving down production, and a loss of consumer confidence due to BSE. The European Union is growing more dependent on imports since its beef deficit is estimated at 450,000 metric tons this year.

Six U.S. plants are eligible to export beef to the European Union, but USMEF is working on increasing that number. USMEF also establishes distribution links for U.S. beef to develop product loyalty and consumer confidence in addition to expanding U.S. beef on restaurant menus.

U.S. pork has increased by 55 percent this past year with exports to Romania expected to drive up that number this year, already increasing 309 percent in quantity and 572 percent in value through September.

An expanding economy and retail industry in Russia are fueling U.S. meat imports. Large retailers like Wal-Mart are gaining market share in Russia. Russia has implemented a quota system to control exports, but the United States has a favorable quota, expected to increase next year.

Russia imports one third of its meat, and U.S. beef exports are expected to regain pre-BSE levels by 2006 as USMEF markets the tastiness and quality of U.S. marbled beef. U.S. pork exports to Russa are expected to increase next year since it has a favorable position in the Russian quota system and consumer demand for muscle cuts is on the rise.

An area experiencing the highest economic expansion and rising per capita income is the Middle East, which imports 90 percent of the beef it consumes with 80 percent of its beef livers coming from the United States.

The strategic market profiles (SMPs) reviewed by USMEF members can be viewed online by going to www.usmef.org, “rolling over” the “Intl Markets” item in the left navigation pane, and then selecting the country or region of interest.

The U.S. Meat Export Federation is the trade association responsible for developing international markets for the U.S. red meat industry and is funded by USDA, exporting companies, and the beef, pork, corn, sorghum and soybean checkoff programs.

– USMEF –