Like it or not China is now a key driver in many U.S. agriculture markets, from dairy to corn to pork, and now, beef. China’s rapid economic development during the past two decades, multiplied by 1.3 billion people, has created a wave of consumerism across the nation. Cell phones rode a wave as China Mobile (owned by the Chinese government) became the largest cell provider on earth. China Mobile has three times as many subscribers as AT&T and Verizon combined. Automobiles have also rode the wave of Chinese consumerism with 2013 auto sales topping $21 million; U.S. auto sales hit $15.6 million last year. And now it may be beef’s turn to ride that wave.
The rising demand for beef has not been matched by Chinese supplies. Chinese cattle slaughter declined by 3.7 million head from 2008 to 2013, an 8 percent decline. Chinese agriculture is fighting for resources
(feed, land and water), and beef is much less significant than pork. Chinese beef production also declined
8 percent from 2008 to 2013. Chinese officials are currently scrambling to ensure food resources for their
1.3 billion citizens, offering new rounds of subsidies for key staples such as rice, corn and pork. Beef
will likely take a backseat in the Chinese food policy realm as officials seek to maintain self-
sufficiency in other key strategic food items.
This is also evident in China’s willingness to allow beef imports. Imported corn and pork have faced
strong Chinese resistance in recent years through non-scientific trade barriers, from GMO restrictions on
corn to bans on FDA-approved feed additives in pork. During this same time, beef import access has
improved with China opening to Canada and working to open Brazilian access. In fact, Chinese officials
have recently stated that July may be a good time to consider relaxing the 10 year old BSE ban on U.S.
beef.
As a result of the rising demand and increased access, China’s beef imports have skyrocketed, up 345
percent last year alone to 314,000 metric tons. If you add in Hong Kong and Vietnam, potential sources of
beef into China, the total grew to 1.39 million metric tons of beef and beef products in 2014. That takes
the greater China region solidly to the No. 1 spot globally, nearly double the volume of the No. 2
importer (U.S.) in terms of beef imports.
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Source: Beef Issues Quarterly
Posted by Jami Howell
