February 11, 2008

Japan beef prices to soar anew on record livestock feed costs

Japan, which already has the world's highest beef prices, will likely increase prices anew as farmers reel from escalating livestock feed costs on global demand for ethanol.

Japanese farmers plea for understanding from consumers as the rise in beef prices pertain to their ''very survival,'' Toshihiko Baba of JA Group, the country's top agricultural organization, said.

Baba and other farmers announced to hold a public campaign to justify beef price increases to consumers.

Last year, the cost of feed in Japan rose significantly due to the rise in corn prices in the US, the world's leading producer of corn, a key ingredient in ethanol.

Japanese meat prices, set in negotiations with chain stores, have stayed roughly the same in recent years, around US$37 a pound.

The cost is about a tenth of the cost of US beef, which has also increased by about 4 percent from the previous year, while pork prices are up 2 percent. Average beef costs about US$4 a pound in US stores.

To offset the sharp rise in feed costs, the price of Japanese beef should go up JPY15 (US$14 cents) per 100 gramme, the farmers informed.

The number of beef cattle farms in Japan has dropped over the last four decades to 86,000 nationwide from 1.16 million, according to JA. Japan now has 7,800 pork-raising farms, down from 714,000, and 26,000 dairy farms, down from 360,000 in 1966.