Beef Prices Rise in Response to Demand in Asia
Cattle prices in the U.S. have risen since September as a protein shortage in Asia drives bets that livestock will be in increasingly high demand.
Prices for many cuts of beef were advertised higher this week than at this time last year, according to the U.S. Department of Agriculture. A common variety of ground beef sold for an average of $3.75 a pound this week, for instance, up nearly 20 percent from a year earlier.
The rally coincides with the continued spread of African swine fever in Asia. The virus—fatal for pigs but harmless to humans—was found in South Korea in September, after surfacing in North Korea in May. As of last week, 145,000 pigs have been culled in South Korea, the government reported.
The disease has devastated hog herds in China, the world’s largest pork market. Roughly 1.17 million hogs have been culled there since August 2018 in an effort to stop the disease, according to the Food and Agriculture Organization of the United Nations. This widespread slaughter has pushed the price for pork in China up 69 percent.
The U.S. beef industry is aiming to fill some of that protein deficit. Beef exports to South Korea are already 8 percent higher than last year, totaling 174,290 metric tons through August, according to the U.S. International Trade Commission.
Exports to Japan were 3 percent lower in that time frame, but demand is expected to pick up as meat supplies tighten in the region. A U.S.-Japan trade deal reached in August also will likely boost demand. The agreement reduces or removes tariffs on some $7 billion in U.S. agricultural goods exported to Japan annually, including beef.
Source: Wall Street Journal