While pork consumption in China is nearly 10 times higher than beef consumption, beef demand is growing. According to a recent report out of USDA Foreign Agriculture Service staff in Beijing, more Chinese consumers are switching to beef to meet their protein in response to food safety concerns following the H7N9 poultry outbreak. The increased beef demand will result in a slight increase in domestic beef production in China and lead to an increase in beef imports.
USDA updated its projection for beef production in China by 2 percent to 5.75 million tons. According to the report, the Central Government in Beijing has invested in domestic beef production in order to help expand production.
On the import side, the report projects imports to reach 550,000 tons, 75,000 tons above USDA’s 2014 estimate. Australia, Uruguay and New Zealand are China’s top suppliers of beef, with imports from Australia accounting for 53 percent of China’s total imports in 2013.
Despite the United States being designated by the World Organization for Animal Health (OIE) as a country with “negligible risk” for BSE, or the lowest risk category, the U.S. does not have access to the market mainland China due to restrictions related to the 2003 case of BSE in the United States. While there have been reports that the Chinese market may open for U.S. beef sometime in 2014, Brett Stuart of CattleFax said during the recent Cattle Industry Convention that it could take time before U.S. beef regains market access in mainland China.
The USDA report forecasts 2014 beef consumption to reach 6.26 million tons, 2 percent higher than USDA’s official estimate of 6.19 million tons. This is a trend that will likely continue. According to Stuart, beef demand in China will continue to grow as its middle class population is expected to double by 2020. In addition, despite the average income in China being approximately one-sixth of the average in the United States, Chinese consumers are paying virtually the same price at the meat case as U.S. consumers.
The USDA report also looked at the status of pork production and consumption in China and forecasts pork production to be 2 percent higher, at 55.8 million tons, than USDA’s official 2014 estimate. Per capital pork consumption may only increase 1 percent, to 41 kilograms per capita, according to the report. Public health concerns related to the 2013 incident when 10,000 dead pigs floated from Zhejiang Province to Shanghai Huangpu River continue to have a negative impact on consumer purchase decisions related to pork.
