Troubles for top beef exporters feed higher global meat prices
Comments Off on Troubles for top beef exporters feed higher global meat prices

Troubles for top beef exporters feed higher global meat prices

Posted by | July 20, 2017 |

Fatter prices for all types of meat may be on the cards as religious and health concerns threaten to curtail supply from the world’s top beef exporting countries and leading importer China seeks to satisfy its appetite with other sources.

India exported the most beef in 2016, sending 1.76 million tons abroad, according to the U.S. Department of Agriculture, a figure that equates to 19% globally. The bulk of India’s total comes from buffalo meat, which sells for around half the price of ordinary beef. And though roughly half of these Indian exports go to Vietnam, much of that meat is forwarded to China, the top beef consumer worldwide.

But that all stands to change after Indian Prime Minister Narendra Modi’s government ordered a ban on the sale of cattle for slaughter in late May. The ruling Bharatiya Janata Party triumphed in key state elections in March, giving Modi the political muscle to enact the ban. The country’s Supreme Court suspended the law on Tuesday. But the party is backed by a Hindu nationalist group that is particularly opposed to the slaughter of cows — a sacred animal in Hindu tradition — casting uncertainty over whether India will remain a stable beef supplier.

Beef buyers also are preparing for a lean period from Brazil, based not on politics or religion but rather over questions of safety. The country exported 1.69 million tons of beef last year, or 18% of the world total. But the U.S. on June 22 halted imports of fresh Brazilian beef, citing food safety concerns. Brazilian media report abscesses were found on beef carcasses. This incident comes after Brazilian meat processors were discovered in March to be selling chicken and other products that fell short of sanitary standards.

These quality concerns could give China further reason to take its business elsewhere. The Asian nation imported 812,000 tons of beef in 2016, according to the USDA, beating No. 2 importer Japan by nearly 100,000 tons. Though Japan obtains no beef from India or Brazil, the country still may face rising prices for various meats as China substitutes products from those leading markets with others, according to a major meat wholesaler.

Meat from Australian milk and breeding cattle, sold here in ground form, fetched around 705 yen ($6.18) per kilogram on the wholesale market in early July, up 19% from a year prior. Fewer cattle have been raised due to a drought in the country, eating into supply. Prices on Thai chicken have fattened 5% on the year as buyers shift away from the meat’s Brazilian counterpart.

Japan is entering a season of heavy demand for meat. But passing on any rising wholesale prices to the public could blunt sales, said a representative for Tokyo-centric supermarket chain Inageya, if the country’s sluggish personal consumption figures are a reliable indicator.

Source: Nikkei Asian Review.