Source:  Tom Johnston, MEATINGPLACE.COM, 9/30/10

The messages at the World Meat Congress 2010 are clear. The world’s population will grow to 9 billion people from 6.8 billion by 2050. Global meat production will likely have to double, but the industry will have to find a way to do it on less arable land.

In an interview with Meatingplace on the sidelines of the conference, Phil Seng, president and CEO of the U.S. Meat Export Federation, says the dilemma is a challenge – but also an opportunity.

What are some of the takeaways you have from this conference?
I first attended one of these World Meat Congresses back in 1984 or 1985 and haven’t missed one since London in 1991. What strikes me is that the whole industry has evolved in a very positive fashion. Back then people were talking about the amount of production, the amount of consumption, the difference (between the two) and the opportunity. I think what distinguishes this conference is that it’s so focused on sustainability.

As an American, I’m very pleased we have the lamb, pork and beef industries all represented here. It shows there’s a strong commitment from the U.S. to look not only at what we do domestically to set the standard for the world, but also to see where the world is and how we can work with other countries to create a better environment for all of us. That’s a very powerful message that’s coming out of this meeting.

What concerns do you have in terms of sustainability initiatives with particular regard to U.S. meat exports?
We’re transporting meat from the U.S. to probably more than 100 countries. It’s a very important initiative for us to not only produce the product in a sustainable and ethical fashion but also that we ensure that transportation and all facets involved are environmentally sound. As has been said at this conference, intensive agriculture and production is one of the key answers to this whole area. The United States is positioned like no one else, frankly, to take advantage. We have to create a whole new vocabulary in selling product so that we can be the greenest of the green. I see in this meeting tremendous seeds of opportunity especially for U.S. red meat industry in the world’s markets.

In what way can the United States take advantage?
Just look at intensive agriculture. Ours has become more intensive and more specialized due to cost of production, increased efficiencies and so forth. Just that metric alone is enormous because we can produce more, with the help of richer feed grains, for example. If the U.S. can take advantage, we have a lot we can look forward to, but we need to make decisions now to get there tomorrow.

One thing I’m concerned about is whether we making decisions in Washington and in the states that will allow us to be factors going forward. Just look at Brazil; their whole national effort is geared toward exports. There’s no doubt they look at the world as being their export destination, and they’re mobilized. However, in our country we’re debating agriculture policy, including concentration in the processing sector and packer-producer marketing arrangements, etc. We need to take a look at what it it takes for us to be globally competitive. If you’re not globally competitive, you’re not going to be competitive at all, and we’re going to see some visitation from some countries we never dreamed would be exporting to us.

Here in Argentina, government policies and other factors have hurt the meat industry. What’s your take on the issue?
I mean this with all due respect, but I think some of the decisions made in Argentina have been debilitating to the Argentine beef industry. They were one of the most noble, first and foremost beef exporters in the world for the last century. The decisions in the last few years have decimated a vibrant industry. They’ve reduced their cattle herd by 10 million head of cattle to 49 million head, and there are restrictions on what they can export. You’re also seeing probably half the processing plants have closed. And countries that have invested in Argentina for its abundant natural resources have basically walked away from here.

Not having the export market doesn’t allow an industry to generate the premium they normally would. When you lose that premium it makes it difficult for industries to reinvest in themselves. In the U.S., we need to look at how much we’re contributing to that effort and whether we can do more. The more returns we have from the international market, the more we can reinvest and reinvigorate the U.S. cattle and pork industries. In Argentina, we’re not only seeing bad government policy but also economics that are taking over, and it’s not a pretty picture.

USMEF’s focus is on increasing sales of U.S. red meat exports. Whose ear are you bending here?
There are a lot of ways to influence people. We’ve done a lot of interviews, our personnel are heavily [represented] on the program and in the committees. One of the things we always try to do is position the U.S. industry as a premier industry, one that is innovative and science-based. You look at our grant system and everything we have, we’re the envy of the world. We’ve always tried to accentuate that positive. We still maintain that position as a market leader.

In regards to upping sales, efforts are continuing in the U.S. to establish a traceability system. To what extent would U.S. exports grow if there were a meaningful system?
In the more advanced countries we export to, like Korea, Japan and Europe, traceability schemes are already part of the fabric of their domestic industries. It’s a matter of time before they’re going to require this, and it’s maybe only one food safety scare away. When it does occur, you might all of a sudden see some legislation that says, 'Henceforth we’re going to impose traceability.’ What’s also bringing it closer to reality is that all of our major competitors, such as Australia and Canada, already have traceability in one form or the other, and they’re advertising it. It’s critical that we address this issue and address it soon.

Do you think it’s going to take a mandatory system in order to make traceability effective as possible?
What we’ve seen as we’ve resumed trade with Russia and some other countries after the BSE issue is they’re writing special programs. So if you don’t have a government-mandated system, all of sudden Korea says we’re going to mandate that you have traceability. It’s going to divide the industry. There’ll be people who will do it and accrue premiums, and there’ll be people who won’t. Going forward, when making policy decisions we need to do it with an eye on what’s going on in our export markets and what our competition is doing.

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