Heifers bound for Kazakhstan fetch 25 percent premium

By DAN WHEAT

Capital Press

CLE ELUM, Wash. -- Japan will soon be buying more U.S. beef and there are opportunities to sell live heifers to Kazakhstan, Washington cattlemen were told at their annual convention.

After seven years of a 20-month age limit on U.S. beef to protect itself from bovine spongiform encephalopathy, known as mad cow disease, Japan is about to return to a previous 30-month age limit, said Terry Reynolds, director of sales at Agri Beef Co. in Boise.

"Our distribution partner in Japan sees a big rush. People want U.S. beef again. We will see a big peak at the beginning and then it will dwindle down," Reynolds said.

He spoke during a panel discussion on marketing at the Washington Cattlemen's 87th annual convention and trade show at Suncadia resort near Cle Elum on Nov. 8.

Exports of short ribs, choice short ribs and other cuts could increase dramatically and change the dynamics of U.S. beef sales, Reynolds said.

Beef exports to Japan collapsed in 2004 after BSE was discovered in the U.S. in late 2003. Exports to Japan have never fully recovered but exports to other countries have slowly rebuilt to 2003 levels.

Agri Beef, other exporters and the U.S. Meat Export Federation are analyzing which Asian countries are willing to pay the most for U.S. beef, Reynolds said. The U.S. is negotiating for access to China and when that door opens there will be even more trade opportunities, he said.

Steve Herbst, of seed stock producer Nelson Angus Ranch, talked about selling registered Hereford and Angus heifers to importers in Kazakhstan for 25 percent more than they sell for in the U.S. Kazakhstan, once part of the Soviet Union, has eaten most of its own cattle and depends on imports, said Herbst, of Salmon, Idaho.

"They have people who enjoy beef and are willing to pay for a positive eating experience," he said.

Nelson Angus Ranch, now in its third year of exporting to Kazakhstan, sends about 200 heifers per year. They are sent by airplane in 18 hours and arrive in better condition than if shipped by water over 23 days, he said.

Nelson Angus Ranch deals with a broker who ships about 3,000 head annually to Kazakhstan, mostly from the Midwest, he said.

Dal Dagnon, an Okanogan County rancher, told Herbst he and other Okanogan County producers would like to join the export program.

"If it's worth an extra $35 per head it will keep us in business," he said, noting a single packer controls prices in North Central Washington.

Rod Wesselman, of American Angus Association, Moses Lake, said he helped supply Nelson last spring. One company in Kazakhstan bought 100,000 heifers last year and wanted 200,000 this year, he said.