South Korea Means Top Three Markets Are Back

By Mike Miller, Cattle-Fax

Click here for photo of Mike Miller

Click here for graphic of U.S. Beef Exports to South Korea

South Korea has finally announced that it will resume U.S. boneless beef imports from cattle less than 30 months of age.  South Korea’s Agriculture Ministry said on Sept. 8 that 36 U.S. plants designated to handle beef for export to South Korea met required safety measures, clearing the last hurdle for the resumption of imports.

It will likely be at least a month before the first product is shipped; however, this agreement finally assures at least limited access to all of the important export markets for U.S. beef.

Prior to the ban, South Korea was the third largest export market for U.S. beef both in terms of tonnage and value, behind Japan and Mexico.  In 2003, which was the last full year of beef exports to South Korea, the country represented nearly 20 percent of the total U.S. beef export market.

U.S. beef exports totaled 544 million pounds of beef and beef variety meats at a value of over $815 million during 2003.  Beef exports to Korea had also been on a fairly steep growth curve during the previous five years.

Beef and beef variety meat exports to Japan totaled 830 million pounds (product weight) during 2003 and were valued at nearly $1.4 billion dollars.  Exports to Mexico that same year were 741 million pounds at a value of $877 million dollars.

Exports to Mexico are on a pace to be record-large in 2006, which is encouraging and hopefully provides a marketing roadmap on how to build exports to both Japan and South Korea.

With the reopening of this important market, the U.S. finally has access to its top three markets.  Again, it will likely be a slow process and regaining the lost market share will take several years.  In fact, beef exports are not expected to reach pre-BSE levels until 2010.

The resumption of normal beef movement into Japan and South Korea will be a positive factor for beef and cattle markets over the next several years.   It’s not likely to have a major impact this year, but should provide support in 2007 and 2008.