Australia, U.S. post gains in volume as consumers seek value
By RICHARD SMITH
For the Capital Press
SEOUL -- South Korea's imports of U.S. beef increased 66 percent in the first five months of the year compared with the same period in 2009, U.S. Meat Export Federation data show.
"Our share among the imported beef market, according to customs clearance figures for January-May, is now reaching 30 percent," said Ji-Hae Yang, federation director for South Korea.
Yang's counterpart at Meat and Livestock Australia gave similar good news, jubilantly pointing to figures showing during the same period that despite Australian market share going down year-on-year from 58 to 52 percent, Australia's beef exports to South Korea rose 36 percent.
"That's good news because we're growing, America is growing, everybody's growing, the big pie is growing," Jim Lim said.
Several factors explain the rise, including a stronger economy and stronger consumer confidence. Yonhap News Agency reported the Bank of Korea's Consumer Sentiment Index, a gauge of consumers' overall economic outlook, living conditions and future spending, reached 112 in June, up from 111 in the previous month.
The South Korean economy grew 2.1 percent in the first quarter on strong consumer spending and exports. In June, the government revised its 2010 economic growth forecast to 5.8 percent from an earlier estimate of 5 percent, Yonhap reported.
People here are just generally more confident, eating out more and shopping at the supermarket more, Lim said. "And that's why chilled beef is doing extremely well."
Lim also credits the "Trust Campaign" the federation started last December for increasing the total beef import market.
"The demand has grown because the Americans have gone on an advertising campaign, which has made consumers switch from pork and chicken to beef," Lim said.
The advertising campaign aims to show South Korean consumers there is no difference between the U.S. beef exported to their country, and the meat producers serve to their families. The advertisements feature images of U.S. cattle grazing in open fields, consumers enjoying U.S. beef meals in restaurants, shoppers buying high-quality U.S. beef in supermarkets and cattlemen engaged in proper care and handling of their livestock.
Min Park, senior manager of the federation's public relations in South Korea, said her office ran bus ads in December, cable TV commercials from December to March, ads on two electronic billboards in Seoul in December and January and magazine advertisements have continued running since December.
Park said her office does not publicize promotional budget figures, but Lim said his office estimates the campaign cost $1 million a month through March, mostly for the cable TV commercials.
Rapidly increasing imports do not equal rapidly increasing consumption, said Bo-Hee Lue, the Korea Meat Importers Association secretary-general.
"It's a different thing. Consumption is slowly increasing," he said.
The meat team senior associate for the 115-store Homeplus discount retail chain said domestic beef sales have decreased as sales of cheaper imported beef rose.
"This is due mainly to inflation and soaring of retail prices, and in that situation consumers tend to prefer low-priced products," Hyo-Seok Kim said.