Trade key to moving 'tsunami of meat'

Krissa Welshans and Sarah Muirhead 1, Editors

December 1, 2016

3 Min Read
Trade key to moving 'tsunami of meat'

THE U.S. Meat Export Federation (USMEF) recently marked its 40th anniversary during its Strategic Planning Conference in Carlsbad, Cal., and while significant changes from the past have come to fruition, the organization is looking to the future.

"This week, there will be many remembrances of what we've accomplished in this organization over the past 40 years, and everyone here should take great pride in that, but for most of you, it's not the past that drove you to attend this meeting; it's about what we're going to do today, tomorrow and into the future," Philip Seng, USMEF president and chief executive officer, told attendees.

According to Seng, the U.S. eclipsed $13 billion in meat exports. "That's quite an accomplishment when you consider some of the challenges we've had over all these years," he said, adding that the goal is for $20 billion in meat exports in the near future.

If there was any doubt that trade is important, Seng pointed out that 80% of the world's buying power lies outside of the U.S., so "the more we can have this export mentality, (and) the more we can challenge ourselves to do better, the better it is going to be for all of us."

Some recent highlights for U.S. trade include that the U.S. beef industry just surpassed Australia as the number-one supplier in the South Korean market. The U.S. also recently passed Australia in chilled beef exports to Japan, which Seng called a milestone.

The Chinese market has provided some success stories for the U.S., with Seng noting that there are now nine pork plants in the world's fastest-growing market for pork. However, challenges remain, as it's still not easy selling in China, he said, adding, "It's not the most transparent place, and it's very hard to follow product in that market."

This year, South Africa opened up to U.S. poultry, pork and beef imports. From the end of February until now, South Africa has tied with Mexico for the number-two beef liver export market for the U.S. This is truly remarkable, Seng added.

Despite the victories, Seng warned that trade is declining.

"Trade is no longer rising around the world," Seng explained. "Actually, this is the first time since World War II that trade has declined during a period of economic growth. That's why what we are doing in the meat industry — whether it's the beef complex, the pork complex, the lamb complex — the fact that we are increasing our exports (means) we're really going against the grain right now, because most industries are not enjoying robust export sales."

Seng referenced World Trade Organization data showing that 2,100 new trade restrictions were imposed from 2008 to 2016. Sometimes, it may seem like there are fewer trade restrictions and more free trade agreements, but "frankly, we are still in a very protectionist world," he said.

Fifteen countries account for 63% of world trade. "What that means is there are certain countries that are franchised in, and there are certain countries that are franchised out," Seng said.

"This is one of the challenges we have with the WTO," he said. "There are more losers than actual winners when it comes to trade, just given those 15 countries. Usually, it's those 15 countries that write the rules, so it's become quite complicated when we take a look at international trade."

The challenges ahead, according to Seng, include the state of Korea's economy, the impact of Britain's vote to leave the European Union and whether societal norms will begin to affect trade deals.

The paramount question on everyone's mind, however, is how to deal with the "tsunami of meat" heading toward us, Seng said. It will be key, he said, to focus on what can be done over the next couple of years to move more meat, as well as what can be done for demand enhancement in this industry.

Volume:88 Issue:12

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