China Demands U.S. Beef

Despite Tension Over Taiwan, Human Rights and Even a Diplomatic Olympic Boycott

By Larry Stalcup, Contributing Editor

February’s Beijing Winter Olympics couldn’t speed skate past icy tension between China and the United States over questions about human rights, the origin of COVID-19 and Taiwan’s sovereignty. The United States even had a “diplomatic boycott” in mind.

Thankfully, there’s plenty of tasty, tender, U.S. grain-fed beef available to help slice through the frigid relations. Members of the Chinese Communist Party, thousands of other Olympic visitors and dignitaries, not to mention the many athletes living their dreams and representing some 90 countries can forget about politics over a plate of short ribs or even a ribeye or other American beef that’s in high demand across China.

Yep, beef exports to China continue to sizzle. U.S. beef and other meat companies continue to capitalize on the huge market access gains achieved in the Phase One Economic and Trade Agreement, says Dan Halstrom, president and CEO of the U.S. Meat Export Federation (USMEF).

USMEF’s Jan. 6, 2022, report shows that through October 2021, exports to China increased by more than 500 percent in volume, 154,857 metric tons (mt), and more than 600 percent in value, about $1.26 billion. As China’s largest supplier of grain-fed beef, the United States accounted for 10 percent of China’s imports on a value basis and 6 percent of import volume.

Exports to the combined China/Hong Kong market have already far exceeded previous annual records. But with all of the tit-for-tat tension between the United States and China, how do American beef exports continue to make their way into the massive market?

Halstrom tells CALF News that “USMEF certainly follows the U.S.-China trade relationship carefully and we are aware of potential pitfalls. But it is important to keep in mind that U.S. beef exports to China are driven by company-to-company transactions.

“Buyers in China want the product that best meets their clients’ needs,” Halstrom says. “So the key factor for U.S. beef exports is simply to have meaningful and reliable access to the Chinese market, which was achieved in the Phase One Economic and Trade Agreement.”

Halstrom emphasizes that China “complements an outstanding range of well-established markets such as Japan, South Korea and Taiwan, as well as Mexico, Canada and Latin America.”

Record Overall Beef Exports in 2021

Overall U.S. beef exports reached 115,709 mt in October, up 7.5 percent from a year ago, while export value climbed 48 percent to $956.9 million – the second-highest total on record, behind August 2021, according to data released by the U.S. Department of Agriculture and compiled by USMEF.

Through the first 10 months of 2021, beef exports totaled 1.19 million mt, up 17 percent from a year ago. Export value increased 38 percent to $8.53 billion, surpassing the 2018 record of $8.33 billion with two months to spare.

USMEF says broad-based growth puts beef exports on a $10 billion pace.

They will top $2 billion in each of three key Asian markets – South Korea, Japan and China/Hong Kong.

Japan remains the leading volume destination for U.S. beef. Through October, exports to Japan were 5 percent ahead of the previous year’s pace in volume (269,815 mt) and 19 percent higher in value ($1.92 billion). Growth to Japan included a 15 percent increase in chilled beef, up to 130,551 mt, valued at $1.13 billion – up 24 percent on continued strong retail demand.

Through October, Korean exports were also up 13 percent to 235,260 mt and increased 32 percent in value to $1.93 billion. This growth included a 50 percent increase in chilled beef export value ($831 million), with chilled volume, up 23 percent to 71,860 mt, despite ongoing social distancing restrictions impacting the foodservice sector.

Other January-October highlights for U.S. beef exports include:

nð Mexico: Export value increased 39 percent to $861.1 million. Mexico is the largest volume destination for U.S. beef variety meat, with exports increasing in value by 20 percent to $211.2 million.

nð Taiwan: Export value on pace for 16 percent to $532 million. Chilled exports were up 37 percent to $351 million. USMEF says the United States continues to dominate Taiwan’s imports of higher value chilled beef, capturing more than 80 percent of the market share.

The value of beef exports to U.S. producers is staggering. Beef export value per head of fed slaughter equated to $439.46 in October, up 55 percent from a year ago, USMEF says. The January-October average was $394.14, up 34 percent.

U.S. beef, pork, grain, cotton and other commodity sales to China, Russia and other countries that may not agree with us politically are gold to U.S. producers. Old-timers remember when the United States set a grain embargo on the then Soviet Union in 1980. U.S. wheat markets tumbled. It took several years to rebuild that and other markets.

Foreign consumers of beef and other U.S. ag commodities want the quality U.S. producers can provide. Chinese beef buyers won’t let a U.S. ship or two skating in the South China Sea butcher a deal for short ribs headed to Shanghai, population 26 million.

“When given the chance to compete, demand for U.S. beef will remain strong in China, even when tensions rise between the two governments,” Halstrom says.

The USMEF, National Cattlemen’s Beef Association and other promoters of U.S. beef plan on helping introduce beef to more Chinese and other foreign consumers.

And Olympic athletes like snowboard king and gold medalist Shaun White shouldn’t have any trouble obtaining the beef cut they prefer. When preparing for the Sochi Olympics in 2014, White said, “I usually eat a pretty big steak the night before I compete.”

He’s hungry for another gold and shouldn’t have to worry about finding beef on the Beijing menu.