U.S. Beef Promotions Adjust to Changing Market Trends in Taiwan

To meet the demands of a shifting economic climate, USMEF-Taiwan recently launched two large-scale promotions of U.S. boneless beef short ribs in more than 1,000 retail outlets. The campaign was a departure from other recent retail promotions that focused mainly on underutilized beef cuts.

USMEF’s promotional strategy in Taiwan has evolved from a year ago, when soaring short rib and short plate prices prompted increased importer inquiries about alternative cuts. Joel Haggard, USMEF senior vice president for the Asia Pacific region, said Taiwan is one of several Asian markets that began feeling the impacts of China’s tightening beef import controls earlier this year.

“This resulted in price corrections for some popular items, especially short ribs and short plate,” Haggard explained. “These two cuts have a very important role in the Taiwanese beef market, and the increase in inventories made some buyers hesitant to make purchases because they anticipated a further decline in prices.”

To help provide renewed momentum for these items, USMEF worked with importers to conduct an unprecedented joint promotion with seven major retail chains: Pxmart, Carrefour, A-Mart, Taiwan Fresh, Wellcome, Dollars Mall and Taisuco. The importers provided these retailers with special pricing for chilled, USDA Choice short ribs and organized two nationwide promotional campaigns. Funding support for the promotion was also provided by the Texas Beef Council.

“Consumers responded very positively to the promotions, purchasing more boneless short ribs and reaffirming their position as the most popular U.S. beef retail item in Taiwan,” said Alex Sun, USMEF-Taiwan marketing manager. “And attractive pricing is not just limited to promotions. U.S. beef retail leader Costco, which recently opened its 11th store in Taiwan, has lowered its non-promotion price for boneless short ribs by 20 percent since the beginning of the year.”

To support the promotions and highlight U.S. beef’s increasing affordability and versatility, USMEF recently invited members of the Taiwanese media to an event at the Eslite Hotel to showcase “economy-friendly” U.S. beef cuts. USMEF also distributed educational materials, including a series of short plate and short rib pamphlets, to importers, wholesalers, retailers and HRI operators prior to the September barbecue season in order to further stimulate the market and ease inventory pressure for importers. More sessions for importers and representatives of the retail and foodservice sectors are planned for the fourth quarter of 2015.

While Taiwan’s total beef imports have trended lower this year, demand for U.S. beef has remained strong, noted Davis Wu, USMEF-Taiwan director.

“The United States continues to be the top beef supplier to Taiwan, and U.S. chilled shipments are being exported at a record pace,” he said. “Market conditions have been very challenging this year, due to the strength of the U.S. dollar, the West Coast port congestion that slowed exports in the first quarter, and other factors impacting the region. But while consumers continue to show an extremely strong appetite for high-quality U.S. beef, it is important that we maintain a high degree of visibility for the items that have performed so well for us here.”

Through July, U.S. beef exports to Taiwan increased 5 percent from a year ago in volume to 20,387 metric tons (mt) and jumped 13 percent in value to $183.3 million. Australia’s exports over the same period were down 28 percent in both volume (18,014 mt) and value ($97.9 million). New Zealand is the market’s other major beef supplier and has a tariff advantage from a recently enacted free trade agreement with Taiwan – its exports were up 4 percent in volume (16,740 mt) and 5 percent in value (to just under $100 million). U.S. beef holds more than 60 percent of the chilled imported beef market in Taiwan, the highest market share of any Asian destination.