Jul 24, 2014
Home| Tools| Events| Blogs| Discussions| Sign UpLogin

Power Hour: China's Beef Imports to Jump

September 6, 2013
By: Ed Clark, Top Producer Business and Issues Editor
beef cow prices
Despite major growth, beef at present remains a niche product in China, accounting for only 8% of total per capita meat consumption, in contrast to 22% for poultry and 65% for pork.   

 

China’s beef imports are expected to rise substantially during the next decade, potentially benefiting U.S. producers. Beef consumption in China has risen steadily in recent years, as has all meat consumption, driven by rising incomes, dietary shifts and urbanization.
"The consumption of beef in China is expected to rise, on a per capita basis, by 24% in the coming decade," according to Rabobank analyst Guilherme Melo. "This is actually below what it should be, as supply shortages and rising prices restrict demand," Melo says in a new report. "The absolute volume will increase by roughly 25%, adjusted for population growth."
With Chinese production unable to grow fast enough to meet increasing demand, the growing market provides a great opportunity for exporters from the key beef producing countries. These include Australia, New Zealand, Brazil, Uruguay, India, and potentially the U.S., providing the Chinese suspension from the aftermath of the 2003 BSE outbreak in the U.S. is lifted.
Despite major growth, beef remains a niche product in China, accounting for only 8% of total per capita meat consumption, in contrast to 22% for poultry and 65% for pork.
"It is generally considered more of a special occasion item, rather than an everyday meal option," Melo notes. Over an estimated 60% of total beef consumption takes place outside the home with the major options for eating away from home including ‘hot pot,’ canteens at work, Western style restaurants and fast food restaurants such as McDonald’s and KFC.
While demand has been growing at a reasonable pace, Chinese beef production has stagnated since 2006. This is mainly attributable to a low economic return for beef production compared to other agricultural activities, linked to a combination of high input costs such as labor and feed, poor genetics, reduced government support and difficult access to farm credit.
To correct the market imbalance, imports will remain on the rise, Melo believes. "This will offer great opportunities for exporters from the key beef producing countries, most notably Australia, which is not only geographically closer, but is also well placed to supply a variety of beef products to meet different segments in China’s market," Melo says. However, other important exporting nations are also likely to benefit, and no specific country is expected to dominate the market. China is expected to provide or increase access to more countries wishing to enter its beef market, according to the report.

 

See Comments

RELATED TOPICS: Power Hour - Business

 
Log In or Sign Up to comment

COMMENTS

No comments have been posted



Name:

Comments:

Receive the latest news, information and commentary customized for you. Sign up to receive Dairy Today's eUpdate today!

 

MARKETS

CROPSLIVESTOCKFINANCEENERGYMETALS
Market Data provided by Barchart.com
 
 
 
The Home Page of Agriculture
© 2014 Farm Journal, Inc. All Rights Reserved|Web site design and development by AmericanEagle.com|Site Map|Privacy Policy|Terms & Conditions