The Growing Demand for Beef in China and the Underestimation of Import Needs

In the latest Global Beef Market, the newsletter that the consulting firm Steiner prepares for Meat and Livestock of Australia, (the independent company that regulates standards for the handling of Australian meat and livestock) introduces a surprising hypothesis: “The Department of “United States Agriculture (Usda) has long been overestimating China’s domestic beef production and that leads them to also permanently underestimate the real import needs of the Asian giant, which despite all the dire forecasts remain extraordinarily high.”

All analysts and operators have been surprised by the 295 thousand tons (product weight) that China imported last July, which constitutes a historical record. This happened when all forecasts assured that as a consequence of the high accumulated meat stocks and poor domestic demand, purchases abroad were going to fall.

Another recent USDA study on the meat market in China maintains that current beef consumption in that country is still very low (7 kilos per capita) and that in the coming years it will surely continue to grow.

“Beef consumption in China is low in relation to the rest of the world, and in relation to its neighbors, and has a lot of potential to grow,” the report maintains.

Furthermore, average out-of-home consumer spending on meat is still very low, well below that seen in other Asian countries.

The study calculates that in the case of beef and sheep, the participation of the imported product in total national consumption was only 0.5% in 2010, while last year it was 20%.

Beef consumption will continue to grow in the coming years, and most of that additional increase will be covered by imported meat.

Regarding the concern aroused in the market by the high stocks of imported meat accumulated in warehouses and chambers, a Chinese market analyst in a recent article highlights that although the current high volumes are a negative figure, it should be considered that China usually maintains huge stocks of all types of grains and foods, for strategic reasons.

Among them, the high public and private stock of pork stands out.

It is possible that there is today the equivalent of six to nine months of beef consumption stored in cold storage, but that would be a stock only slightly larger than usual.

“The problem is that the data on food reserves is not public data, and it is difficult to estimate how much it actually amounts to. Chinese importers have been arguing for months that a huge stock of unsold beef – especially imported – has accumulated, and they are putting downward pressure on the prices they pay,” the publication states.

China imported 1.52 million tons of beef in the first seven months of the year, worth about $8.2 billion, with a 7% increase in volume, but a 19% drop in value per ton .

The main supplier is Brazil, with 605 thousand tons and a 40% market share, followed by Argentina, with 306 thousand tons and a 20% share. In third place is Uruguay, with 169 thousand tons and an 11% share, followed by Australia, with 129 thousand tons and an 8% share.

In fifth place is New Zealand, which shipped 131 thousand tons; in the sixth United States, with 95 thousand tons.

Seventh place is occupied by Bolivia, with 34 thousand tons shipped to China in the first seven months of the year.

2023-09-24 03:00:01
#Chinese #vacuum #cleaner #add #power #Agro #voice #interior