China gorges on American grain-fed beef amid shrinking supplies from Down Under By Reuters
[ad_1]
© Reuters. Wolfgang’s Steakhouse, a restaurant that specializes in American beef, prepares steaks for a guest chef in Beijing on September 8, 2021. Picture taken September 8, 2021. REUTERS/Carlos Garcia Rawlins
2/3
Dominique Patton, Tom Polansek
BEIJING/CHICAGO – As Australian beef exports from China deteriorate due to diplomatic tensions, China’s demand for U.S. beef-fed beef is on the rise, fueled by a rising middle class in China.
The No. 2 economy in the world is seeing hotpot and Japanese-style barbecue restaurants as well as steakhouses grow. Australian beef is being replaced by U.S. pork. Last year several Australian suppliers were expelled and other shipments take far too much time to clear customs.
According to Chinese customs data beef imports from America have increased to 83,000 tonnes over the past eight months. This is nine times more than the number in the same time period last year. They are expected to reach more than $1B this year. Australia was also ranked second in China’s top-exporter of beef fed grain to the United States.
Joe Schuele, spokesperson for U.S. Meat Export Federation said that there are not many other choices when it came to well-marbled, wheat-fed products. That’s what makes China so special.
Australia’s supply chain has been affected by the deteriorating relations between Beijing, Canberra. Beijing suspended five of the country’s largest factories last year due to poor labelling or contamination by a prohibited substance.
Importers claim that other plants can still ship to China. However, they are often subject to long delays.
China Customs Data shows that beef imports from Australia fell by half to 96,000 tonnes in the first 8 months of this year.
According to a Beijing-based Importer, six containers of Australian beef frozen in Shanghai are still at Shanghai port. He has started offering Tyson beef to his customers.
This is compared to the average of one week for meat from different origins. The General Administration of Customs of China did not respond when we asked for comments.
Relations between China and Australia have been difficult since 2018. They were further strained last year, when Australia requested an independent investigation into how the new coronavirus was created. China responded by threatening trade.
GRAIN-FED DEMAND
Although grass-fed beef is a high-end product elsewhere, it tends to be sold in China through cheaper outlets such as supermarkets and mass-market restaurants.
China consumed 40%, or approximately 2,000,000 tonnes of beef last year, from imports. Although Brazil, Argentina, and Uruguay dominate the supply, mass market consumers are slowing down due to a weaker economy.
China’s middle-to high-end market where grain-fed rules are in place continues to grow. But, Pan Chenjun, senior Rabobank analyst, stated that as China’s consumers trade up, they eat better.
According to Brookings U.S. Research Group, China’s middle classes spent $7.3 trillion in 2020. This is higher than any other country’s. It’s still growing with more young people spending more than others.
New York’s Wolfgang’s Steakhouse opened two Beijing restaurants this year. Another was in Shenzhen. There are plans to open a fourth one in Hangzhou.
Restaurant flies chilled U.S. beef in its aircraft before it’s aged. Each 800g rib-eye costs $150
Glen Feng (manager of Beijing’s outlets) stated that young people love meat.
China beef imports by supplier, January-August https://graphics.reuters.com/CHINA-BEEF/klvykgrnrvg/chart.png
TRADE LINKS
China has seen a surge in beef consumption over the past few years due to a rising middle class. However, political changes have led to a reshuffle of some of its top importers.
Zhong Dingming (manager of Jingli hotpot in Beijing) said that local production costs have made it more difficult for China to produce grain-fed beef. For a slightly more expensive price, he said that imported beef, such as Tyson shortribs from Tyson, is of better quality.
China and Washington reached a Phase 1 trade agreement last year that allowed U.S. approved processing plants to access their market, without Chinese inspections.
There are more than 500 shipping facilities that can ship to China.
TREX Corporation, a U.S. exporter of meat, is owned by Greater Omaha Packing Co.
Joel Haggard is the senior vice president of the Asia Pacific for USMEF. He said that the organization has more than doubled its training programs in China to help local chefs cut and slice the food.
Value of U.S. beef exports to China https://graphics.reuters.com/CHINA-BEEF/lbvgngxjmpq/chart.png
Swiss Butchery, a Shanghai-based retail chain, said that it has stocked up with American beef because Australian supply became less reliable. General manager Jaap Zuidervliet said that the store sells American wagyu at 1,430 Yuan (221.87) per kilogramme. On occasion, it may also sell 10 kilogrammes.
According to Omaha’s Davis, U.S. beef which meets China’s import standards are in limited supply. The European Union also wants the same meat.
Although Australia’s beef exporters are now looking to Japan and South Korea for their meat, they have a solid reputation that means Chinese customers could return quickly if the situation changes.
The quality of Australian beef is still high and it’s natural. Andrew Cox is the general manager for international markets of Meat and Livestock Australia. He said that long-term, we remain bullish about China.
($1 = 6.4452 renminbi)
[ad_2]