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Cowboys In Japan
By Jay Wolf
It’s easier to understand the term foreign country when you see 6’3” Dave Hamilton (taller in his western boots and hat) towering above everyone in a sea of Japanese. Or, when a bunch of Nebraskans sit on the floor to eat dinner and they can’t pronounce anything that is served, but it sure looks like raw fish. Add to that watching swinging carcasses being auctioned one by one, with some bringing over $10,000 per beef! These were among the many experiences a group of producers encountered on a recent trade mission to Tokyo.
The Nebraska Corn Board, Nebraska Beef Council and Nebraska Soybean Board assembled a joint trade team, and the Corn Board invited me to go along. The 12 participants worked cooperatively to promote American beef to Japanese consumers. We handed out beef samples at an outdoor festival, serving more than 500 per day (they all seemed happy with our product). The activity was part of a campaign by the U.S. Meat Export Federation (USMEF) and Seiyu stores to show the Japanese that American producers care about their product. This is a part of USMEF’s ongoing strategy to rebuild Japanese consumer confidence in U.S. beef. A Seiyu beef buyer said the event provided a positive image of U.S. beef to customers and was effective in increasing sales. Seiyu has announced it will expand U.S. beef sales to all of its 379 stores.
The team had the opportunity to meet with USDA trade officials at the U.S. Embassy in Japan. They explained the history of Japan’s BSE policy, the current Japanese political situation and efforts to expand U.S. beef trade. Nebraskans were able to ask a series of questions. It’s clear that the U.S. government takes re-establishing full beef trade very seriously and is keeping the issue a top priority. However, the political climate in Japan is difficult, to say the least. The opposition party is using trade as a weapon, with little regard for science. The ruling party is treading a treacherous path, trying to negotiate with the U.S. while fending off attacks that imply they’re being too weak on trade issues. The U.S., on the other hand, needs a good agreement with Japan because other Asian countries will be reluctant to allow trade on a more liberal basis than Japan does.
How critical is this issue to cattlemen? Beef trade with Japan totaled $1.3 billion in 2003. Japan and Korea represented 57 percent of U.S. beef export value pre-BSE. So far, we have regained less than 10 percent of that trade. The next few months will be very important, so stay tuned.
It was very interesting to see beef being marketed in the meat case. Seafood is the dominant protein in Japan, but many consumers have a strong desire to eat beef. Steak sells from $8 per pound when featured (U.S., Australian or domestic Holstein) to as much as $185 per pound for the highly marbled Kobe beef. We sampled some Wagyu beef in a restaurant. It is so highly marbled that the lean almost disappears. It is served thinly sliced and uncooked. A pot of water boils in the center of the table for dipping. A person takes a slice of beef with their chopsticks, dips it in the boiling pot, quickly removes it and then dips it in a sauce. I prefer a good steak myself.
Traceback is very important to the Japanese consumer. We saw examples of their traceback systems in the major stores. A customer can take a package of Australian beef, go to a kiosk, type in the numbers on the package and see a picture and description of the beef producer. When the system was established, Japanese consumers lined up to use it. Now that they have seen it work and feel confident, they no longer utilize it as much. However, Japanese retailers feel that for U.S. beef to compete with Australian beef, we must be able to offer the same capability.
We witnessed an example of a U.S. company working to establish a traceback system with a Japanese beef marketing firm. Nebraska’s own Premium Protein Products (PPP) has a partnership with Yonekyu of Japan to market PPP beef. We happened to be in Yonekyu’s office the same time that PPP CEO Steve Sands was. Sands is from Lincoln and we have been friends since childhood. It illustrates how global the world is when you go halfway around the earth and see someone you live 100 miles from. He explained the PPP traceback program, which tracks beef cuts from the ranch, through the feedlot, harvest and processing all the way to the meat counter. We then went to lunch to sample some product – a very good ribeye steak. (No one asked for fish!) Then our hosts presented a picture of the producer. It was Alan Janzen of Circle 5 Feedlot in Henderson and former NC president! It really is a small world.
USMEF, our host for the trip, is a vertically integrated U.S. meat industry trade association. It is funded by meat packers, processors, farm organizations, commodity groups and others interested in promoting foreign sales of U.S. meat. Three significant contributors from Nebraska include the Nebraska Beef Council, the Nebraska Soybean Board and the Nebraska Corn Board. That’s right, the Corn Board! It invests $350,000 annually in USMEF. They do so because they believe one of the best ways to add value to corn is to feed it to cattle, and the cattle industry needs exports to sustain profits. This trip was an excellent example of different agricultural interests in Nebraska working together for a common goal.
USMEF kept us very busy, but it wasn’t all business. We spent a Sunday touring Tokyo, visiting Japanese temples, shrines, the harbor and other points of interest. We also ended the trip by visiting the Mt. Fuji area, which gave us a chance to see some of the scenic mountainous areas. A highlight was spending the night in a traditional hotel with its hot mineral bath. It was certainly different sleeping on futons over bamboo mats, experiencing a public bathhouse and eating traditional Japanese cuisine (raw fish again). Of course, we ended our final evening with that most popular Japanese custom, karaoke. A couple of glasses of sake and we all thought we sounded pretty good.
It was truly a memorable trip. I encourage any producer who gets an opportunity to travel to a foreign country to do so. I learned a lot about my own business by visiting somewhere else. I also learned there is no place like home, especially at dinnertime. Y Jay Wolf is NC president and Nebraska representative to the U.S./Japan trade mission. His trip was sponsored by the Nebraska Corn Board.
Some additional information we gained included:
î Japan imports 66 percent of its food, which helps explain why they are so sensitive about food issues.
î Japan’s cow population numbers 3.5 million head – 60 percent dairy, 40 percent Wagyu.
î Japan has had 34 cases of BSE. The government badly botched the handling of the early cases and overreacted in attempting to restore public confidence. That’s why they BSE-test every carcass over 20 months of age and want the U.S. to do the same.
î Australia exports 60 percent of its beef production, with the high-quality cuts going to Japan and Korea. Japanese companies have invested heavily in the Australian cattle industry and won’t give up their market share in Japan easily.
î Japan is a country of 123 million people living in an area roughly the size of California. Eighty percent of the land is very mountainous, so the cities are incredibly crowded. Tokyo’s metro area contains 35 million people (all of them shorter than Dave Hamilton).
Graphics Used:
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Caption: Dave Hamilton readies himself for traditional Japanese tea during the recent trade mission to Tokyo.
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Caption: Dave Hamilton, Thedford, and Dave Bruntz, Friend, stand in front of a statue of Buda in Tokyo.
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Caption: NC President Jay Wolf, left, stands with the USMEF host Yama Ymashoji at the trailhead to the mineral hot springs near Mt. Fuji in Tokyo.
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Caption: The Tokyo skyline |