Long Beach, Calif. (Nov. 8, 2002) – Exports of U.S. meat to Japan and Korea...

Long Beach, Calif. (Nov. 8, 2002) – Exports of U.S. meat to Japan and Korea in October, especially chilled pork, were adversely affected by the West Coast longshoremen’s dispute, U.S. Meat Export Federation reported during its annual board of directors meeting here today.

Several Japanese companies turned to air freight to maintain supplies of U.S. chilled beef and pork, and the USMEF Tokyo office estimates that air charges added some 250-300 yen per kg. ($0.90-1.00/pound). The element of unreliability in supply of the vital chilled pork market could drive buyers to turn to pork from domestic and competitor sources, especially since Japanese hog carcass prices are currently low. In addition, the dispute hit future U.S. beef sales by causing retailers to cancel or postpone U.S. beef promotions in the third and fourth weeks of October and hold domestic beef promotions instead.

In addition to delivery problems, Japanese buyers, concerned about the future progress of the dispute, ordered less October-produced U.S. beef. Prior to the strike, the most recent Japanese import figures (September) showed an 18.1 percent decline in total beef imports at 48,480 metric tons (mt), compared to the same month in 2001. The U.S. captured the largest market share (48 percent) with 23,539 mt, 17.8 percent lower than September 2001.

In South Korea, the shortage of chilled U.S. beef also prompted some Korean traders to import U.S. chilled beef by air, thus impacting Korean prices. The wholesale price of Choice grade short rib in Seoul went up from 8,500 won per kg ($3.16 per pound) in early September to 10,000-10,500 won per kg ($3.72-3.91 per pound) now, and high prices affected Korean consumption of U.S. beef. The price increase also drove some retailers to cancel or postpone U.S. beef promotions and promote domestic product instead and some restaurants to offer lower quality items or to turn to Australian beef.

USMEF said it was not aware of similar steps taken by U.S. exporters to assure movement of product to other Asian countries. That doesn’t mean there won’t be an impact, however; “Imagine the flow of water through a pipe,” explained USMEF Asia-Pacific Vice President Joel Haggard. “If you introduce a bubble of air into that pipe it takes a while for it to go from one end to the other. The dock dispute created a supply bubble that is just now reaching Asia. We are likely to see an impact for the next few weeks.”

The Japanese government has not released official October import figures but estimates that October pork imports will total 40,200 mt, 25 percent less than last October and chilled pork imports are estimated at 27 percent lower, at 13,700 mt. Prior to the strike, the most recent Japanese pork import figures (September) showed a 132 percent increase in pork imports (48,666 metric tons (mt)) compared to the same month in 2001. The U.S. captured the largest market share (32 percent) with 15,609 mt, 17 percent higher than September 2001. Imports of U.S. chilled pork, were 150.9 percent higher at 5,643 mt.

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 --