July 27, 2006

 

Japan's lifting of US beef ban could bring prices down

 

 

Japan's approval Thursday (Jun 27) of the resumption of US beef imports from selected processing plants would force prices down, said Peter Weeks, chief market analyst at marketing concern Meat & Livestock Australia Ltd.

 

"Some of the Japanese buyers will be looking to bring those prices down; they have had very high prices for over two years," Weeks told Dow Jones Newswires.

 

Japan was a huge consumer of US beef before December 2003, when US beef was banned due to mad cow disease.

 

Japanese buyers then turned to Australia to help fill the gap left by the ban on US beef.

 

Australian beef exports soared, rising almost 25 percent due to the increased demand.

 

However, Japanese beef consumption fell by about a quarter over the same period, in part reflecting the impact of high prices.

 

Weeks said the volume of Australian beef exports to Japan is not likely to contract much, with the startup of US exports initially likely to be slow.

 

Australian producers remain committed to supplying Japan with large volumes of beef, with no sign among feedlot operators of them winding back production, he said.

 

Moreover, Japanese import protocols on US beef are "pretty tough," he said.

 

There is plenty of room in Japan for the beef of both countries, he said.

 

The first US air freighted product could arrive in Japan within days, while sea freighted product would take several weeks, he said.