US Beef is Being Promoted in Japan
Japan is a market beef producers have been wanting to tap into for a long time.
The recently made US-Japan trade agreement, reduces or eliminates tariffs on more than half of Japan’s $12.9 billion of agricultural imports from the US.
Recently a group of US cattle Producers took a trip to Japan to see first hand how US Beef is being promoted. Cevin Jones with the Meat Export Federation was among them.
The trade deal, set to take effect Jan. 1, reduces tariffs on about $7 billion of US goods heading to Japan, and on about $40 billion of goods going in the opposite direction. Conspicuously absent from the pact were rice, select dairy products, and—the pair’s traditional sticking point—autos and auto parts. Still, the agreement represents the two countries’ effort to recapture trade synergies lost when the US withdrew from the multicountry Trans-Pacific Partnership in 2017.
Japan agreed to reduce tariffs on $2.8 billion worth of US beef and pork. In 2018, the US exported 12% of the 12.3 million tonnes of beef it produced, of which 19% went to Japan. In pork, 22% of the 11.9 million tonnes produced were sent abroad, with Japan receiving 15% of the exports. In the past decade, Japan’s share of US beef and pork exports has run as high as 20% and 23%, respectively. So the reduction of tariffs on both meat products is certain to have a meaningful and supportive price effect for US hog and cattle producers and processors.
Other countries that currently receive US beef and pork exports aren’t likely to be shortchanged. With favorable production margins, US producers have an incentive to expand production rather than reroute exports away from established buyers. The long-term nature of trade agreements, along with a low and stable feed-cost environment in the US, suggest continued expansion of US meat output.