BY SUSAN BLOWER
WASHINGTON D.C. — U.S. cattlemen should see a significant increase in the price per head of their cattle in 2013 as a result of an agreement with Japan to import beef from U.S. cattle less than 30 months of age, up from the previous limit of 20 months, according to Kent Bacus, associate director of legislative affairs for the National Cattlemen’s Beef Assoc.
Announced late last week and put into effect on Feb. 1, this new trade agreement will result in hundreds of millions of dollars in exports of U.S. beef to Japan in coming years, said U.S. Trade Rep. Ron Kirk and USDA Secretary Tom Vilsack in a joint statement.
“Today’s announcement reflects another successful effort by the Obama Administration that boosts the bottom line for America’s agriculture. We are in the most successful period in history for America’s agriculture sector, with agricultural exports this year expected to set yet another record,” Vilsack said. “We will continue our efforts to break down barriers and expand access for high-quality, safe and wholesome U.S. food and agricultural products to Japan and around the world.”
While exports of U.S. beef to Japan totaled $1 billion in 2012, more than $1.5 billion in exports are expected in 2013, Bacus told Farm World. This is good news in the face of many challenges to beef producers, he said.
“The increased demand for U.S. beef means a very strong market for us. The change from 20 to 30 months of age limits allows us to develop a bigger source of available beef … This is a welcome piece of news after the impact of drought and high inputs for cattle ranchers. It will provide positive economic incentive to stay in the game,” Bacus said.
The announcement came nearly 10 years after Japan banned U.S. beef and beef products following the detection of one U.S. animal that tested positive for bovine spongiform encephalopathy (BSE) – commonly known as “mad cow” disease. In July 2006, Japan partially reopened its market to allow imports of some U.S. beef from cattle aged 20 months or younger produced under a special program for Japan.
Based on a revised risk assessment by Japan’s Independent Food Safety Commission (FSC) released last October, Japan began to work with the United States to revise the import requirements.
“This agreement goes a long way toward bringing Japan in line with import conditions that are based on science and consistent with international standards. We will also continue to engage with Japan with the objective of full consistency with World Organization for Animal Health recommendations for U.S. beef imports,” Ambassador Kirk told Farm World.
The progress made thus far has been a “concerted effort” for 10 years of many Republicans and Democrats on Capitol Hill, as well as two administrations under President George Bush and President Barack Obama, and Japan’s FSC with its recent recommendation to change protocols, Bacus said.
“We have attempted to provide the Japanese government with an understanding of our industry, to educate them on all of our cow-calf products, feeder practices, and the cattle industry. There’s been a lot of engagement through USDA and our trade representative (Kirk),” Bacus said.
Bacus said Ambassador Kirk, who is leaving his post later this month, has done a tremendous job opening markets to U.S. products, not only to Japan, but to Korea, Columbia and Panama (see related story on page 8).
U.S. farmers and ranchers want consumers to understand that the safety of U.S. beef is their top priority. Scientific studies continue to validate that safety, which the international community has accepted for some time now.
“We wouldn’t feed any product to others that we wouldn’t feed our kids,” Bacus explained.
A minority within the cattle industry have an anti-trade background and are uncomfortable with exporting beef products, Bacus stated.
However, Asian markets represent a unique opportunity in that the demand in those countries is for non-traditional muscle cuts, such as beef tongue and short ribs, Bacus said.
“These sell at a premium in foreign markets. These exports add to the overall value of the price per head. We do our best to meet American consumption. Ninety percent of our beef is sold domestically,” he said.
“With 96 percent of the world’s population being outside U.S. borders and the increasing demand for protein in the Asian diet, the future of our industry is to diversify our customer base,” Bacus continued. “We will need to meet the demand (for American products) that’s there.”
This improved outlook for U.S. beef comes at a crucial time when producers are facing continual pressures, which provide incentive to get out of business. These pressures include regulatory constraints, tax codes, high input costs, as well as droughts and other natural disasters, Bacus said.
“A lot of producers are not in it for the money. They love what they do. It is nice to provide them with a positive economic incentive to stay in the game,” he added.
Japan has confirmed that it will continue to review progress under the new agreement and consider raising the age limit above 30 months for U.S. beef and beef products in the future.