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EL: How big is the Chinese market?
JOD: China is already a large producer of beef and it imports a further 700,000t of beef every year. The Chinese consume much less beef than European or western counterparts. On average, they consume 4kg/person/year compared with 19kg/person/year in Ireland. Looking at their neighbours Japan and South Korea, they consume around 9kg per head per annum. If China increases its consumption by as little as 1kg per person, it will need 1.3m tonnes more beef every year. It could easily take 10% of Irish beef exports in the future.
Who are the biggest suppliers of beef to China currently?
Brazil has become the largest supplier of beef to China, displacing Australia which has moved into second position. Other large suppliers are New Zealand, Canada and the US.
What is the timeline for access for Irish beef to China?
It is expected that the first containers will be filled over the month, so it is imminent. It then takes six weeks to reach China by sea, so Irish beef will be for sale in China within the next 10 weeks.
What types of cuts will the Chinese demand?
We have been working with industry on this for more than four years. China is about adding value to the overall carcase. The cuts initially will be shin, shanks and short ribs. These are seen as prime cuts in China. There is a much higher appreciation in China for these cuts than there is in the western markets.
What is the marketing strategy?
Our strategy is to get Irish beef to be used in everyday cuisine, rather than as an occasional event. The biggest use of beef in China is in hot pot – a traditional Chinese food. The industry will focus on two key areas; restaurant chains and online retailers. These are the big growth areas in China.
Where will Irish beef be placed in the market place?
We are not going to be the cheapest supplier of beef to China. In terms of positioning on price, the cheapest suppliers will be the Brazilians. We cannot compete here. The Canadians are at the premium end, with the hope that Ireland will by next in terms of price, followed closely by Australia. We don’t want to be opportunistic and this is about building long-term partners. The biggest challenge, as access has now been granted, will be to expand and maintain it.
How is the Chinese economy currently?
The Chinese economy is growing at 7% per annum currently, as the government focuses on consumption and increasing spending. There is a growing level of confidence among the Chinese also.
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