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Korea’s Beef Imports Surge in October; Pork Market Still Sluggish

Korea’s October beef and beef variety meat imports surged to their highest level since January at 31,205 mt, up 12 percent from a year ago. Imports from the United States were up 26 percent to 11,650 mt, including 900 mt of chilled beef (+36 percent). Strong demand for bone-in short ribs also pushed the U.S. frozen bone-in volume higher (6,239 mt, +32 percent). Total October imports from Australia were up 8 percent from a year ago to 16,549 mt. Korea-Beef-Imports

For January through October, Korea’s beef/bvm import volume was steady with last year at 249,419 mt but value was up 8 percent to $1.26 billion. Import value for U.S. beef was higher than a year ago ($480.5 million, +6 percent) despite smaller volumes (86,045 mt, -6 percent). Imports from Australia were higher in both volume (134,431 mt, +7 percent) and value ($675.7 million, +12.5 percent). For chilled beef, total January-October imports were steady at 33,244 mt. An increase in chilled imports from the United States (7,163 mt, +6 percent) offset a slight decline from Australia (26,033 mt, -1 percent).

One factor in the Korean beef market’s recent momentum may be ongoing consumer concerns about the safety of seafood. An October survey by the Korea Rural Economic Institute (KREI) revealed lingering reservations over the safety of seafood products, despite the government’s announcement that it found no trace of radioactive materials in any fish recently caught in seas neighboring the disabled Fukushima nuclear power plant in Japan. In the KREI poll, 78 percent of consumers surveyed said they reduced their seafood consumption by nearly half since the August news reports of water leaking from the plant. More than 40 percent said they increased meat consumption as a result of their reduced seafood purchases. While most said they chose domestic beef or pork as their replacement protein, this can still provide a boost for imports entering a very crowded protein market. Korea-Pork-Imports

Korea’s domestic cattle inventory continues to be extremely high, peaking in September at 3.14 million head and far surpassing the level (estimated at 2.5 million head) that domestic beef demand can truly support. Hanwoo cattle slaughter increased 13 percent during the first nine months of this year to about 718,000 head. Domestic beef prices have fallen as a result, leading Korean farmers to complain that these declining prices have not supported their rapidly increasing feed costs. One specific problem facing the domestic beef industry in recent years is that consumers have a growing tendency to focus their interest on a narrow range of middle meats, while demand for other cuts is in decline. For example, this year prices for front feet declined by 42 percent to $5.30/kg. At the same time, prices for ribeyes fell just 3 percent to $45.50/kg (comparing January-October 2013 averages to the same period in 2012).

Korea’s hog slaughter has also increased again this year, up 18 percent in the first nine months of the year to 11.68 million head. September slaughter was up a more modest 2 percent, but hog prices remained low resulting in only a modest recovery in October pork and pork variety meat imports – which were higher than in the previous two months, but still trailed last year by 13 percent at 25,436 mt. Larger imports from the EU (12,397 mt, +7 percent and led by Germany) were offset by smaller volumes from the U.S. (6,649 mt, -26 percent), Canada (3,364 mt, -17 percent), and Chile (2,405 mt, -37 percent).

January through October pork/pvm imports were down 21 percent to 273,273 mt with smaller volumes from all main suppliers, including the EU (106,897 mt, -23 percent), U.S. (98,429 mt, -14 percent), Canada (34,419 mt, -32 percent) and Chile (27,312 mt, -16 percent). Compared to the pre-FMD period of January-October 2010, however, Korea’s imports were up 10 percent, including a 46 percent increase from the United States.

(Data source: Global Trade Atlas)