Japanese beef imports – tsunami or ripple?

Riding the ripple of Japanese beef imports to Australia

The recent lifting of the ban on imported Japanese beef into Australia has many in the Wagyu industry curious about what impact it will have on domestic business.

In short, it may impact a little on suppliers into high-end steak, Japanese and Korean cuisine restaurants, but beyond that, it is not likely to be significant.

There are a few reasons why this is the case.

In a recent consultation between the Australian Wagyu Association Board with MLA’s Miho Kondo, Market Insights Manager for Japan and Korea and Andrew Cox, MLA’s Business Manager based in Japan, the sentiment was clear that Japan had a few hurdles to overcome for export to Australia to be viable.

AWA CEO Dr Matthew McDonagh said that “the original ban was put in place in 2001 after an outbreak of bovine spongiform encephalopathy (BSE) in Japan, to protect Australia’s biosecurity.  In a media release from DAWR in early June 2018, the department approved the ‘recommencement of chilled or frozen beef imports from Japan’ – provided all the necessary measures were in place to mitigate identified risks.”

According to Andrew Cox, the major exporters in Japan are not rushing ahead to export to Australia, principally because the Australian market does not represent a significant commercial opportunity. The focus of the Japanese beef industry is to target countries such as Taiwan, which has a significant number of Japanese cuisine restaurants and demand for Wagyu is high.

So just how much beef does Japan export and to where?

Analysis by Miho shows that markets such as Hong Kong, USA and Singapore are the primary export countries for all Japanese beef, while Cambodia and Tajikistan show significant levels but are believed to be grey markets into China. Since Taiwan opened its doors in 2017, it is now the fifth-largest market for Japanese beef.

“Prior to BSE in the Japanese herd in 2001, the last full year of Japanese beef exports to Australia was less than 500kg,” said Andrew. “The highest level was around 750kg in the late 1990s.

“Given that things have changed since then and Japan is now more geared toward exports, the output is now around ten times what it was in the late 1990s. The Australian landscape has also changed in that time with a greater foodie culture that would take on products such as Wagyu. The cost of importing Wagyu into Australia would put the Japanese product at a higher price than locally produced Wagyu.

“The feeling in the commercial space is not one of great excitement. Exporting to Australia is more about the kudos for the Japanese beef industry that they have cracked our stringent biosecurity nut and potentially made it easier to transition into other markets. We don’t see Japanese beef imports into Australia as a huge competitor.”

Japanese in-house hurdles

Australia’s biosecurity measures are well known to be one of the toughest in the world and Japanese exporters will still need to ensure that all the accreditation boxes have been ticked before shipments can commence.

The discussion with Andrew and Miho however, suggests that challenges within Japan to be a strong exporter will be more of a hindrance than biosecurity.

It appears that overall Japanese beef production is in gradual decline, with two key reasons. The first is a recent trend for the younger generation to move away from high-end products such as Wagyu for general consumption in preference for leaner, cheaper meats.

The Ministry of Agriculture, Forestry and Fisheries (MAFF) in Japan aims to maintain 2015 levels of beef production and indications suggest it may be difficult to attain. The best way to ensure long term viability is to intertwine a strong export market and promote greater domestic consumption said Andrew.

This in itself presents a challenge as Japanese beef producers compete and promote products based on their prefecture making it difficult to implement an over-arching government strategy to sell Wagyu to the domestic and international consumer.

“A national strategy makes sense from an export point of view, and successful trade shows into Europe and the US have shown the Japanese government can do it, but with the ongoing disconnect between prefectures, supply and the international strategy, Japan has a few challenges to overcome to develop new export markets. It will be a while yet before it has impact on Australian shores,” said Andrew.

Important Notice and Disclaimer

It is very important that you appreciate when viewing the AWA database that the information contained on the AWA database, including but not limited to pedigree, DNA information, Estimated Breeding Values (EBVs) and Index values, is based on data supplied by members and/or third parties.

Whilst every effort is made to ensure the accuracy of the information reported through AWA, AWA officers and employees assume no responsibility for its content, use or interpretation. AWA disclaims all liability (including without limitation, liability in negligence) for all expenses, losses, damages and costs you may incur as a result of the use by you of the data on this AWA database and the information supplied by ABRI and AGBU being inaccurate or incomplete in any way for any reason.

Regarding EBVs and Index values, it is very important to appreciate, and you need to be aware that:

  • EBVs are derived using Wagyu Single Step BREEDPLAN technology developed independently by the Animal Genetics and Breeding Unit (AGBU), using the information contained within the AWA database.
  • AGBU is a joint venture of NSW Department of Primary Industries and the University of New England, which receives funding for this purpose from Meat and Livestock Australia Limited.
  • AWA relies solely on advice provided by AGBU and ABRI in accepting Wagyu Single Step BREEDPLAN software.
  • EBVs published in Wagyu Single Step BREEDPLAN are estimates of genetic potential of individual animals and may not reflect the raw animal phenotype.
  • EBVs can only be directly compared to other EBVs calculated in the same monthly Wagyu Group BREEDPLAN analysis.

Regarding pedigree and DNA testing results submitted to the AWA, it is very important to appreciate, and you need to be aware that:

  • Pedigree and DNA data submitted and supplied to AWA may have errors in it which cannot be detected without further DNA testing.
  • Technology may have advanced since a particular test was undertaken so that previous inaccuracies which were not detectable are now able to be detected by current testing technology.
  • AWA estimates that less than 1% of the pedigree entries, ownership or breeding details in the AWA Herdbook may have errors or which may be misleading. For this reason, users ought to consider if they need to obtain independent testing of the relevant animal (if possible) to ensure that the data is accurate.

Regarding prefectural content, it is very important to appreciate, and you need to be aware that:

  • Prefectural content is based on the estimation of prefectural origin from Japanese breeding records of 201 foundation sires and 168 foundation dams.  As genotype-based parent verification is not used in Japan, and full Japanese registration certificates are not available for all foundation animals, exact prefectural composition for these sires and dams cannot be validated.
  • The calculation of prefectural content for Australian Herdbook animals relies on the accuracy of pedigree records and DNA samples provided by AWA members.
  • The reporting of prefectural content for animals within the AWA Herdbook relies on the calculation provided by ABRI.

If you consider that you do not understand or appreciate the nature and extent of the data provided on this website or the EBVs of a particular animal, then AWA strongly recommends that you seek independent expert advice.