$500m US beef market beckons for exporters
He said Irish beef must be aimed at the $500m (€378m) per annum ‘natural’ beef niche in the US market, in order to be competitive.
Mr Burke said exporters will be identifying potential customers and assessing the competitiveness of the Irish offering in the US, between now and next autumn.
But it was encouraging for exporters that US beef retail prices increased by 9% during 2011.
And this year, the average farm gate cattle price in the US has risen by 20% in comparison to 2011, reaching €3.37/kg excluding VAT — almost 90% of the average EU price.
He said the US move to lift its 15-year-old ban on beef imports from the EU is an important milestone in restoring access to international markets, closed since the 1990s due to concerns over BSE disease.
However, wholesale prices for major prime beef cuts in the US are lower than UK prices.
Manufacturing beef in the US is dearer — but high transport costs would make it difficult to supply manufacturing beef from Ireland.
Instead, Irish exporters should aim for the ‘natural’ beef market.
Including organic and grass-fed categories, it is priced 10% and 15% higher than the 90% of US prime beef which comes from feedlots using growth promoters.
Beef imported into the USA may be sold as ‘natural’, after the process has been verified by the US Department of Agriculture.
The US is the largest single beef market in the world for imports and consumption, with average per capita consumption of about 37kg, more than twice that of the EU. Of the 11.5m tonnes consumed, about 1.7m tonnes is imported.
However, the lifting of the EU import ban could yet be challenged, because it is subject to a 60-day consultation period.
And any import concessions will be coupled with expansion of low duty beef exports of non-hormone high-quality beef to the EU. The 20,000 tonnes of this beef exempted from EU taxes in 2011 is to be lifted to 48,200 tonnes by next August.
Bigger imports of North American beef have not materialised because the US has become a net importer, mainly due to grain for feed being diverted to make biofuels.
Meanwhile, the EU’s ban on imports of beef from cattle treated with growth hormones remains.
