U.S. beef sales face hurdles in China

While American beef was forbidden, competitors gained

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BEIJING — At the Sam’s Club in Beijing’s Shijingshan district, the chilled beef offered for sale is so dominated by Australian cuts — marbled rib eye steaks to fatty oxtail chunks — that many customers are oblivious to the few packs of U.S. meat also available.

“I haven’t noticed the U.S. beef here,” said Hui Xue, who was shopping for steaks that he cooks once a week. Even if he had spotted the product, it probably wouldn’t have gone into his cart.

The American meat — back in China after nearly 14 years as part of a trade deal hailed by President Donald Trump and his administration — was available only in strips for stir-frying.

Viveca Zhang, another shopper, also bypassed the American supply. “I would like to try the U.S. beef, but there are only a few options to choose from,” she said.

Their reticence emphasizes the barriers that U.S. beef faces on its re-entry into the world’s second-biggest consumer after being barred in 2003 due to concerns over mad cow disease.

Iowa Premium from Tama became the first Iowa processor to be approved to ship to China.

While the return prompted fanfare from the Trump administration and promises that shiploads of meat would start arriving at China’s shores, producers may have to endure a long slog back into the market. That’s because rivals from nations including Australia and Brazil rushed in to dominate sales when the Americans were shut out.

“Trade will grow gradually, but I don’t think it will increase to the extent that would affect China’s beef market, because of its limited supply,” Chenjun Pan, an analyst at Rabobank International, said of the U.S. meat.

China, the world’s largest pork producer and consumer, has seen beef demand climb as incomes increase, prompting people to spend on new and varied types of food. Imports are predicted to climb to 950,000 metric tons this year from 26,000 tons in 2003, according to the U.S. Department of Agriculture.

The amount of American supplies entering China currently is relatively small because “the U.S. produces beef differently from other countries like Australia and Brazil, which do not use some feed additives that are banned by the Chinese government,” said Rabobank’s Pan.

That sentiment is in contrast to the unbridled optimism expressed by U.S. officials and industry representatives at a June 30 ceremony in Beijing celebrating the return of U.S. beef.

“Beef is a big deal in China and I’m convinced that when the Chinese people get a taste of U.S. beef, they’re going to want more of it,” Sonny Perdue, Secretary of Agriculture, said while promoting the bilateral deal in Beijing. “These products coming into China are safe, wholesome and very delicious.”

Trump even retweeted an article by The Gazette’s James Q. Lynch last month to express his enthusiasm: “After 14 years, U.S. beef hits Chinese market.”

But there won’t be a “significant amount” of U.S. beef entering the Chinese market in the near term, according to Jake Parker, vice president at the U.S.-China Business Council in Beijing. The U.S. product still faces strict Chinese government rules, with the beef that qualifies being priced for the premium market, he said.

Out of 600,000 head of cattle slaughtered in the United States each week, only about 1,600 can meet Chinese specifications, said Zhifeng Cai, a manager at Womai.com, the online retail platform of China’s state-owned food giant Cofco Corp., which first imported American beef into the country.

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