Asian demand boosts Colorado beef exports

Responding to increased demand from Asian countries, Colorado beef exports have risen 77 percent since 2009 as U.S. retail prices soar.

Beef export sales topped $725 million from January through November last year versus $409.5 million during the same period in 2009, according to the Colorado Department of Agriculture. Beef exports sales from January to November 2013 increased 2 percent from the $710.5 million in the same period a year earlier.

Beef is Colorado’s largest agribusiness sector, which includes processing giants JBS USA (Bovespa: JBSS3) in Greeley, which has a processing capacity of 5,400 cattle per day, and Cargill Inc. in Fort Morgan, which processes 4,500 cattle per day. The state ranks No. 4 in beef exports in the United States, although many of the cattle come from other states such as Kansas and Montana for processing in Colorado, said Jim Robb, director of the Livestock Marketing Information Center.

Growing consumer incomes overseas have fed increased exports during the past several years, Robb said.

“As consumers get wealthier, they tend to want more animal-based protein in their diets,” he said. “We’ve clearly seen that, especially in the Asian markets and even in some of the Middle Eastern markets.”

The rise in beef export sales came as Colorado resumed beef exports to South Korea, where sales grew 38 percent from January through November last year, and as sales grew in Japan and Hong Kong, whose year-to-date growth increased 9 percent and 97 percent, respectively.

Meanwhile, retail beef prices in the United States have surged. Beef rose to $5.03 per pound in December, up 27 percent from $3.97 five years ago, according to the U.S. Department of Agriculture. Exports have led to increased cattle prices, contributing to higher retail prices, Robb said. Strong national demand for beef also led to higher prices.

Exports also have bolstered the Colorado packing and feeding industry and created demand for parts of the cow normally shunned by American consumers, such as the beef tongue popular in Japan.

“We gain a lot of value in these export markets,” Robb said.

Japan, the No. 2 market for Colorado beef behind No. 1 Canada, lifted trade restrictions on U.S. beef last year when it decided to allow imports of beef from cattle up to 30 months old. Japan previously allowed beef only from cattle 20 months old or younger. Before that, Japan had banned U.S. beef amid concerns about mad cow disease.

“We finally, through hard work in the industry, (Department of Agriculture), U.S. Meat Export Federation, got some of these markets back open,´ said Tim Larsen, senior international marketing specialist for the Colorado Department of Agriculture.

Dan Halstrom, senior vice president for global marketing at the U.S. Meat Export Federation in Denver, said the organization has worked the past few years to recapture Japanese market share from Australian beef producers. The United States also has seen increased demand in recent years from smaller-volume markets from countries such as Panama, Guatemala, Chile and Peru.

The increase in beef export sales also came despite Colorado’s loss of the lucrative Russian beef export market in 2013. After importing $54 million in Colorado beef in 2012, Russia banned U.S. beef in 2013 because of safety concerns about the feed additive ractopamine, which increases leanness in meat.

“It was obviously a key market for U.S. beef, as it was for pork,” Halstrom said. “Government-to-government negotiations are ongoing.”

China represents another coveted market for Colorado beef. The Chinese have banned U.S. beef imports since the mad cow panic in 2003, but officials recently promised that China would ease import restrictions on U.S. beef.

“China is the single largest importer of red meat in the world,” Larsen said. “Unfortunately, none of it’s coming from us.”


Social Network

Facebook Icon
Twitter Icon
LinkedIn Icon