Source:Tom Johnston, MEATINGPLACE, 5/10/19


U.S. beef industry leaders are watching closely as U.S.-Japan trade negotiations and Tokyo’s potential removal of a 30-month cattle age restriction would facilitate wider access into the lucrative Asian market, the U.S. Meat Export Federation (USMEF) said.

Trade talks began in mid-April, and the industry is eager for a deal to catch up with competitors now enjoying significantly lower tariff rates under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

“The industry’s message all along continues to be that we are way behind and we need a level playing field,” USMEF economist Erin Borror told Meatingplace. “We need to jump immediately to the same tariff rate as the other suppliers in the market.”

Japan’s duty rate on beef muscle cuts from CPTPP countries such as Australia, Canada, New Zealand and Mexico is 26.6%, almost one-third lower than the 38.5% rate that applies to U.S. beef cuts. The CPTPP rate on variety meats is 5.7%, less than half the U.S. rate of 12.8%.

The stakes are high in Japan, the largest market for U.S. beef. U.S. beef exports to that country last year exceeded $2 billion, about a quarter of the record $8.33 billion exported worldwide, USMEF noted.

Age limit reconsidered
That’s why anticipation also is high for Japan’s potential removal of a rule limiting imports of U.S. beef to only those products derived from cattle aged 30 months or younger. Tokyo put that restriction in place in late 2003 after the discovery of the first U.S. case of bovine spongiform encephalopathy (BSE).

Japan initially reopened the market to U.S. beef in 2006, but restricted access to products from cattle less than 21 months of age. Tokyo bumped up the age limit to less than 30 months in February 2013.

Currently under the consideration of Japan’s Ministry of Health, Labor and Welfare, removal of the 30-month age limit would essentially give U.S. beef full access to the Japanese market. The increase in access also would apply to Canadian beef. The ministry’s public comment period on the matter ended April 26, and the comments are now under review.

According to Borror, some 80% of U.S. beef production comes from fed cattle younger than 30 months of age, but products harvested from older cattle, particularly variety meats like tongue and tripe, are in high demand in Japan. Removal of the age restriction could bump U.S. beef variety meats exports by 25%, and between 6% to 13% in other cuts, she said.

USMEF estimates that removal of the 30-month cattle age restriction will increase total exports to Japan by 7 to 10%, or by $150 million to $200 million per year.

Absent a trade agreement, removal of the age restriction would “be a win in the interim,” Borror said.

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