May 17, 2004

Japan Supermarkets To Buy More Australian Beef
 
Aeon Co. (8267.TO), Daiei Inc. (8263.TO) and Seiyu Ltd. (8268.TO) will collectively secure about 14,000 tons of Australian beef for fiscal 2004, up 40% on the year, the Nihon Keizai Shimbun reported Friday.
 
Given that the ban on U.S. beef imports is likely to continue in the near future, the supermarket operators have decided to expand their offerings of Australian products - which are less costly than domestic equivalents - to boost beef sales. Beef imports from the U.S. were banned in December after a case of mad-cow disease was discovered in the state of Washington.
 
Aeon is projected to increase Australian procurement 10% to 6,000 tons. The firm directly operates a ranch in Australia and increased production immediately following the mad-cow case in the U.S. Most of the firm's imported beef had been from Australia, and the supermarket operator believes that it can expand sales of Australian beef further.
 
Daiei, which will double its Australian allotment to more than 5,000 tons, had imported most of its beef from the U.S. It switched primarily to domestic product after the mad-cow scare. Since Australian beef is less expensive than comparable domestic cuts, "we can make up for U.S. product" with it, according to a company representative.
 
Seiyu will boost Australian procurement 20% to 2,300 tons in addition to importing 480 tons of ground and processed beef products from New Zealand.
 
Most Australian cattle are fed grass, but the supermarkets will limit their procurement to grain-fed cattle because of differences in the texture, taste and aroma of the beef.
 
Japan and the U.S. have continued talks to resume imports, hoping to reach agreement by the summer. But the two sides remain at odds over safety standards, and a timetable for the resumption of imports has not been set.