It has been a long time coming but we finally will have the Korea beef market open again. The market closed in 2003 because of that first case of BSE. It was closed totally for a few years. Then we reached an agreement for 30 months and younger boneless beef. This was a problem for our exporters and packers. If the Koreans would find any bone chips at all they would reject the entire shipment of beef. This was a real problem. Because of the culture and eating habits, we could not find another market for the rejected products. Therefore when a shipment was rejected because of bone chips, it had to be shipped back to the U.S. This was extremely expensive for the packers. This took away many of the incentives to develop that market.  

The announcement of the opening of the market to OIE ( a scientific standard that is used and accepted world wide) standards means we will be able to ship all ages of beef as long as the srm’s are removed. It also will let us ship bone-in product. This is the second country to do this from the Asia. The Philippines was the first country to accept this standard. This agreement will put pressure on Japan and other countries to go to OIE standards. 

So what does this mean to our beef industry?  The estimates that I have been hearing are around $50 a head for every beef animal processed. In times of high feed costs and profits in the red every little bit will help to make the cattle markets get closer to making a profit again.  

What else is happening around the world that will affect our farmers and ranchers?  One of our major competitors, Argentina has closed their borders to exports of certain food products including beef because of high prices and high inflation of food prices. Australia also has low cattle numbers because of prolonged drought and herd liquidation. Brazil also is low on numbers and prices are high. In fact the price of beef in Brazil is higher than here and is mostly grass fed.  We are the only major supplier that has an abundance of product for sale. If we can get access to the market, we can compete with almost any country.  The biggest hurdle we have now is getting shipping containers to ship the product. Because of the value of our dollar and the slow economy, we are not getting enough shipping containers back in the U.S.  We are working on this at Farm Bureau and USMEF (United States Meat Export Federation).  

On the pork side, things look very good for exports. Because of the improving economy around the world, demand for pork is rising. In fact as of the past few days, we are now shipping 20% of all of the pork raised in the U.S.  China has increased their imports 200% in February over a year ago.  The high cost of grain around the world is making our products very competitive.  Prices should get better and profits should rise for livestock producers because of the agreement with Korea and the other circumstances around the world.