U.S. share of South Korean market grows

Jul 22, 2011
by WLJ

Recent South Korea government data showed U.S. beef gaining ground and now claiming 38 percent of the import market in the first five months of 2011. That is 1 percentage point higher than the same period a year ago.

“That’s because many food service operators are going back to U.S. beef,” U.S. Meat Export Federation South Korea Director Ji-Hae Yang said.

Australian beef’s share of the South Korean market went from about half down to 47 percent during the same periods.

“We’re not so concerned about market share. We’re happy the U.S. is back; that means people eat more beef,” said Jim Lim, Korea regional manager for Meat & Livestock Australia.

New Zealand saw a yearon-year percentage point gain to 14 percent, but that’s 21 points less than the high of 35 percent enjoyed by that country’s beef producers in 2004. That peak hit after South Korea banned beef from the U.S. and Canada because of BSE. U.S. beef came back three years ago and has slowly but surely been reclaiming market share.

The smaller market share does not worry the Beef Lamb New Zealand market manager for Japan and Korea, who pointed out New Zealand’s double-digit growth year-on-year. “Accordingly, we would say that NZ beef is in fact showing a good level of increase in the Korean market,” John Hundleby said.

The statistics, from the Ministry for Food, Agriculture, Forestry and Fisheries’ National Veterinary and Quarantine Research Service, bear out both Lim and Hundleby. In this year’s first five months, overall imports rose 44 percent to almost 129,000 tons compared to less than 90,000 tons in the same period this past year.

Year-on-year, beef from Australia grew 35 percent from under 45,000 tons to almost 61,000 tons while New Zealand beef went up 10 percent from just over 16,000 to almost 18,000 tons. U.S. beef imports rose 73 percent from more than 28,000 to almost 49,000 tons.

Even beef from “other” countries shot up 204 percent from 440 tons to 1,336 tons, the report said.

Korean consumer confidence towards U.S. meat was very low through 2009 due to food safety concerns, according to Bo-Hee Lue, the secretary-general of the 80-member Korea Meat Import Federation.

Recently, consumer concern and negative perception have been gradually reduced, Lue said. “Therefore, consumption of U.S. beef have also been gradually increasing, even though concerns still remain among some consumers,” Lue said.

One dark spot in the uptrend is reports from some meat industry sources that there seems to be a lot of U.S. beef stocks in cold storage in the country. “This means that U.S. beef supply to Korea exceeded consumer demand this year,” Lue said.

Compared to 2003, Lue said, there appears to be more room available for South Korean imports of U.S. beef to increase if consumption rises to the level of 2003. “But I think it will take time,” he said. — DTN