ID :
68710
Thu, 07/02/2009 - 18:32
Auther :
Shortlink :
https://www.oananews.org//node/68710
The shortlink copeid
(News Focus) U.S. beef makes few inroads into S. Korean market
By Lee Joon-seung
SEOUL, July 2 (Yonhap) -- Lingering safety concerns and stricter
country-of-origin labeling rules have prevented U.S. beef from making meaningful
inroads into the South Korean market, industry sources said Thursday.
Sources at the state-run Korea Agro-Fisheries Trade Corp. (also known as the aT
Center), the Hanwoo Federation and major discount outlets said that despite early
signs of winning over price-conscious consumers, U.S. beef is being bypassed at
stores and shunned by restaurants a year after Seoul lifted most import
restrictions.
"Early expectations that U.S. beef would regain its dominant position in the
imported meat market have faded, with consumers usually opting to purchase
Australian imports if they cannot buy locally-raised premium hanwoo meat," a
mid-level manager at a discount outlet in Seoul said. He pointed out that lack of
interest has caused some stores to reduce the shelf space allocated to U.S. beef.
From August to Nov. 20 of last year, U.S. beef imports totaled around 40,000
tons, compared to 34,000 tons for Australian meat. Imports totaled 12,200 tons
for September -- three months after Seoul resumed quarantine inspections on U.S.
beef on June 26 -- and rose to 16,700 tons in October.
But starting late last year and early 2009, the import volume nosedived as
unfavorable exchange rates hurt price competitiveness, although prices remained
relatively stable.
In May, imports totaled just 3,300 tons, down from 4,800 tons tallied for the
month before.
Statistics by the aT Center showed that instead of regaining its previous 60
percent share of South Korea's imported meat market as forecast last year, U.S.
beef lagged a distant second behind Australia, which controlled 54.7 percent of
the total import market in the first five months of this year.
Numbers showed that such conditions have not improved, even after U.S. beef
started reaching department store shelves in April. In the past, only large
discount outlets handled U.S. beef with department stores shying away for fear of
attracting negative publicity and protests from consumer groups.
Industry experts said that the main reason for the drop in imports can be
attributed to strong public perception that U.S. beef may be unsafe to eat and
mandatory country of origin labeling rules that must be followed by all
restaurants, butcher shops, catering services and meat stores.
"The labeling rules that went into effect in July 2008 have effectively prevented
restaurants that had been the main consumers of U.S. beef from serving such meat
to clients," said Jang Ki-sun, a general manager at the Hanwoo Association.
He also said that health concerns about imported meat have caused consumers to
opt for hanwoo (Korean cow) or pork.
"The share of hanwoo beef in the overall market has stabilized at around 40
percent of all demand this year, with 15 percent being supplied by locally raised
milking and beef cattle," Jang said. He added this 55 percent market share by
locally produced meat is roughly the same figures reached in 2003 before Seoul
banned U.S. beef imports.
The remaining 45 percent, he said, is controlled by imports from Australia, New
Zealand, Mexico and the United States.
Seoul suspended all U.S. beef imports in Dec. 2003 following the confirmation of
its first mad cow case in Washington State. The disease is thought to cause the
brain-wasting variant Creutzfeldt-Jakob disease in humans.
"The numbers are a clear indication that hanwoo has secured the trust of
consumers while U.S. beef has made little headway," Jang claimed. He said this
view is also supported by price gains made by the local beef in recent months.
Statistics released by retailers showed that as of last month, the average price
for a 500g cut of premium hanwoo beef sirloin topped an average 33,754 won
(US$26.6), the highest price since September 2007.
Prices of the same quality hanwoo beef plunged to 29,968 won in May and 29,463
won in June 2008. The drop in prices roughly corresponds with Seoul's decision to
allow most U.S. beef cuts into the country in mid-April and the starting date of
quarantine inspections by the government.
By comparison, a number of larger retailers said U.S. beef prices had peaked last
year and early this year but started losing ground afterwards.
The price of a 100g cut of U.S. beef chuck eye roll rose to 1,980 won in January
but has since fallen to 1,780 won last month.
Others said that aggressive marketing efforts by retailers have fueled demand for
hanwoo beef and caused consumers to turn away from imports.
Chung Se-hoon, a manager at the Chakangogi meat chain, said by removing retail
profit margins the franchise has cut prices of hanwoo meat to complete with
imports.
The company operates 44 stores nationwide, and their success has fueled the
opening of similar businesses including the Imgingang Hanwoo Village
restaurant-butcher shop chain and an outdoor restaurant chain operated by the
state-run Korea Racing Federation.
An official at the farm ministry said that enhanced market transparency brought
on by the tougher labelling rules has expanded new opportunities for hanwoo meat.
"There are now two separate markets, with one dealing almost exclusively with
hanwoo meat and other handling imports including U.S. beef," Chung said. He said
that under this system, prices play a lesser role than consumer preference.
Many South Koreans prefer hanwoo meat for its quality and taste, but a lack of
market transparency in the past had hurt demand, Chung said. Before the new
labelling rules went into effect, many restaurants disguised imported beef as
hanwoo meat.
Related to the unexpected lack of demand for U.S. beef, a local importers'
association on Wednesday said it plans to take legal action against a TV station
for airing a program many say exaggerated the health risks associated with the
meat.
"Before the 2003 ban, South Korea imported up to 220,000 tons of U.S. beef per
year, but the TV program scared away consumers by spreading unsubstantiated
accusations about U.S, beef safety," a spokesman for the association said.
The association said of its 200 members, up to 50 are struggling to stave off
bankruptcy because of poor sales, and claimed that MBC TV must take
responsibility for broadcasting the program.
yonngong@yna.co.kr
(END)
SEOUL, July 2 (Yonhap) -- Lingering safety concerns and stricter
country-of-origin labeling rules have prevented U.S. beef from making meaningful
inroads into the South Korean market, industry sources said Thursday.
Sources at the state-run Korea Agro-Fisheries Trade Corp. (also known as the aT
Center), the Hanwoo Federation and major discount outlets said that despite early
signs of winning over price-conscious consumers, U.S. beef is being bypassed at
stores and shunned by restaurants a year after Seoul lifted most import
restrictions.
"Early expectations that U.S. beef would regain its dominant position in the
imported meat market have faded, with consumers usually opting to purchase
Australian imports if they cannot buy locally-raised premium hanwoo meat," a
mid-level manager at a discount outlet in Seoul said. He pointed out that lack of
interest has caused some stores to reduce the shelf space allocated to U.S. beef.
From August to Nov. 20 of last year, U.S. beef imports totaled around 40,000
tons, compared to 34,000 tons for Australian meat. Imports totaled 12,200 tons
for September -- three months after Seoul resumed quarantine inspections on U.S.
beef on June 26 -- and rose to 16,700 tons in October.
But starting late last year and early 2009, the import volume nosedived as
unfavorable exchange rates hurt price competitiveness, although prices remained
relatively stable.
In May, imports totaled just 3,300 tons, down from 4,800 tons tallied for the
month before.
Statistics by the aT Center showed that instead of regaining its previous 60
percent share of South Korea's imported meat market as forecast last year, U.S.
beef lagged a distant second behind Australia, which controlled 54.7 percent of
the total import market in the first five months of this year.
Numbers showed that such conditions have not improved, even after U.S. beef
started reaching department store shelves in April. In the past, only large
discount outlets handled U.S. beef with department stores shying away for fear of
attracting negative publicity and protests from consumer groups.
Industry experts said that the main reason for the drop in imports can be
attributed to strong public perception that U.S. beef may be unsafe to eat and
mandatory country of origin labeling rules that must be followed by all
restaurants, butcher shops, catering services and meat stores.
"The labeling rules that went into effect in July 2008 have effectively prevented
restaurants that had been the main consumers of U.S. beef from serving such meat
to clients," said Jang Ki-sun, a general manager at the Hanwoo Association.
He also said that health concerns about imported meat have caused consumers to
opt for hanwoo (Korean cow) or pork.
"The share of hanwoo beef in the overall market has stabilized at around 40
percent of all demand this year, with 15 percent being supplied by locally raised
milking and beef cattle," Jang said. He added this 55 percent market share by
locally produced meat is roughly the same figures reached in 2003 before Seoul
banned U.S. beef imports.
The remaining 45 percent, he said, is controlled by imports from Australia, New
Zealand, Mexico and the United States.
Seoul suspended all U.S. beef imports in Dec. 2003 following the confirmation of
its first mad cow case in Washington State. The disease is thought to cause the
brain-wasting variant Creutzfeldt-Jakob disease in humans.
"The numbers are a clear indication that hanwoo has secured the trust of
consumers while U.S. beef has made little headway," Jang claimed. He said this
view is also supported by price gains made by the local beef in recent months.
Statistics released by retailers showed that as of last month, the average price
for a 500g cut of premium hanwoo beef sirloin topped an average 33,754 won
(US$26.6), the highest price since September 2007.
Prices of the same quality hanwoo beef plunged to 29,968 won in May and 29,463
won in June 2008. The drop in prices roughly corresponds with Seoul's decision to
allow most U.S. beef cuts into the country in mid-April and the starting date of
quarantine inspections by the government.
By comparison, a number of larger retailers said U.S. beef prices had peaked last
year and early this year but started losing ground afterwards.
The price of a 100g cut of U.S. beef chuck eye roll rose to 1,980 won in January
but has since fallen to 1,780 won last month.
Others said that aggressive marketing efforts by retailers have fueled demand for
hanwoo beef and caused consumers to turn away from imports.
Chung Se-hoon, a manager at the Chakangogi meat chain, said by removing retail
profit margins the franchise has cut prices of hanwoo meat to complete with
imports.
The company operates 44 stores nationwide, and their success has fueled the
opening of similar businesses including the Imgingang Hanwoo Village
restaurant-butcher shop chain and an outdoor restaurant chain operated by the
state-run Korea Racing Federation.
An official at the farm ministry said that enhanced market transparency brought
on by the tougher labelling rules has expanded new opportunities for hanwoo meat.
"There are now two separate markets, with one dealing almost exclusively with
hanwoo meat and other handling imports including U.S. beef," Chung said. He said
that under this system, prices play a lesser role than consumer preference.
Many South Koreans prefer hanwoo meat for its quality and taste, but a lack of
market transparency in the past had hurt demand, Chung said. Before the new
labelling rules went into effect, many restaurants disguised imported beef as
hanwoo meat.
Related to the unexpected lack of demand for U.S. beef, a local importers'
association on Wednesday said it plans to take legal action against a TV station
for airing a program many say exaggerated the health risks associated with the
meat.
"Before the 2003 ban, South Korea imported up to 220,000 tons of U.S. beef per
year, but the TV program scared away consumers by spreading unsubstantiated
accusations about U.S, beef safety," a spokesman for the association said.
The association said of its 200 members, up to 50 are struggling to stave off
bankruptcy because of poor sales, and claimed that MBC TV must take
responsibility for broadcasting the program.
yonngong@yna.co.kr
(END)
