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International market updates

Below are bi-monthly updates from MLA’s Regional Managers overseas on the performance of their markets, originally released via the Global Markets Update newsletter.

28 June 2022

China

COVID-19 update: Shanghai was fighting its biggest battle against the COVID-19 pandemic in late March, April and May 2022. As of April 5, the total number of COVID-19 cases exceeded 73,000. Tens of millions of people were in lock down and market consumption severely hampered.

Recently, China has shown a downward trend overall with the number of new cases in Shanghai declining steadily. Some people who hold negative nucleic acid test results within 48 hours can go back to their workplaces from 1 June. Many enterprises in Shanghai will gradually start production with some employees returning to the workplace.

Following the improvements of the COVID-19 situation much of the restrictions have now been lifted, bringing the lives of people back closer to normalcy. However, as China continues to adhere to its zero-COVID-19 policy, the pandemic situation is expected to show volatility and the outlook of the city’s return to normalcy remains unstable.

Market access: In February, Tianjin Port opened its first Australian route since Regional Comprehensive Economic Partnership (RCEP) came into effect, while in March, Dalian and Shandong Port opened a direct line to Australia. Challenges remain in:

the clearance processes
increased proportion and quantity of sampling and testing for imported cold chain foods.

With the impact of the pandemic lockdown in major cities such as Shanghai and Beijing, as well as impacts on ports and shipping, export volume for the first four months of 2022 reached 45,523 tons –down only 2% from the same period last year and the demand for Australian meat remains strong. 

Competitor analysis: China imported 195,859 tons of beef in April, down 5% from March and up 3% from the same month in 2021.

Brazil continued to be China's number one beef exporter with its participation growing significantly, supplying 82,000 tons and accounting for 42% of the total volume. Brazil exported 341,000 tons of beef to China in the first four months of 2022, up 37% on the same period a time year ago.

In the second position are Argentina and Uruguay with 15% share each, and then New Zealand, Australia, followed by US with 7–8% each:

Argentina's landed volume decreased by 14% compared with March, and its market share decreased by 2%, ranking China's second largest beef importer with 15.5% market share.
Uruguay’s landed volume decreased by 23% compared with March, and its market share decreased by 3%, ranking China's third largest beef importer with 14.9% market share.
New Zealand was the fourth largest beef importer with 8% market share, with landed volume decreasing by 22% compared with March.
Australia’s landed volume increased by 24% compared with March, and its market share increased by 2%, ranking China's fifth largest beef importer with 7% market share.
United States was the sixth largest beef importer with 6% market share, with landed volume decreasing by 5% compared with March.

China imported 133,287 tons of sheepmeat in the first four months of 2022, with an annual decrease of 23%. In April 31,989 tons was imported, with a monthly decrease of 11% and 37% below April 2021, reported the Meat International Group. In January to April, 57% of the sheepmeat came from New Zealand, 39% was Australian and 4% Uruguayan.

MLA activity: Since March, 23 articles and 14 videos have been released on five MLA owned social media channels. MLA China conducted seven food sampling activities in March, some samplings (Tianjin, Hangzhou and Shanghai) were impacted by COVID-19 and will be postponed.

The Third Annual Exporter Tea Reception was held with 17 people from eight companies sharing market updates and insights in Shanghai.

In March, MLA partnered with the China Meat Association (CMA), Australian Meat Industry Council (AMIC), Shanghai Meat Industry Association (SMA) and Bright Food International Limited (BFI) to hold the 2022 CARMAG Workshop in Shanghai.

On 8 June 2022, an online Australian Red Meat New Retail and E-commerce seminar was held. With more than 250 industry participants, the aim was to deliver the insights to customers and enhance the communication and engagement between traders and ecommerce platforms. Red Meat Green Facts was presented in this seminar and launched in WeChat on the same day.

South-East Asia

COVID-19 update: COVID-19 cases have stabilised and governments across South-East Asia have largely lifted restrictions. Businesses are able to operate at full capacity with hotels reporting increased occupancy driven by the resurgence of business travellers and MICE (meeting, incentive, convention, and exhibition) events.

Market access: For January to May, South-East Asia beef and lamb trade have been relatively stable, with Thailand beef volumes tracking strongly (6,050 tonnes January to May, 55% increase year-on-year).

Similar to other markets, some logistic issues have persisted with variable air freight capacity for Vietnam, Malaysia, Indonesia.

On-site halal verification audits have resumed for establishments approved for export into Malaysia. Australian Department of Agriculture, Water and Environment, Malaysian Department of Veterinary Services and JAKIM (Malaysia Muslim Authority) are working on an audit calendar for establishments seeking listings and re-listings.

Singapore and Indonesia reported its first Lumpy Skin Disease cases in March. Indonesia also reported Foot-and-Mouth (FMD) outbreaks in early May (it was previously free of the disease since 1990). Per mid-June, over 200,000 FMD cases have been officially confirmed across 19 provinces. Australia is free from FMD and LSD.

MLA activity: While inflationary pressures across key South-East Asian markets have resulted in increased food prices, most premium retailers and distributors still report steady sales of Australian red meat, particularly prime cuts.

Retailers are:

introducing more non-loin cuts
exploring a value-added range e.g. patties and marinades
introducing more meal-kits, ready-to-cook meats and heat-to-eat meals to target families with tasty and convenient offerings.

More developed markets like Singapore and Malaysia are also looking for natural, healthy options and using non-loin cuts for different cooking methods such as stir fry, braising and curry cubes.

Fresh grocery sales through online platforms have continued to increase despite last mile logistic constraints. Restaurants are adopting a hybrid approach with South-East Asia food delivery value to be estimated at ~USD 15.5 billion. In Singapore, it is estimated that online food sales now account for around 14.8% of all channels.

Integrated online/offline campaigns are in full swing. TABLExperience restaurant events in Vietnam increased Australian beef and lamb brand awareness. In Singapore, the Great Steak Escape campaign featured 16 partners across June. Seasonal retail and digital ‘Taste of Tradition’ promotions featuring ethnic and heritage recipes using Australian beef and lamb will start from July. Around 28 exporters and MLA will be participating in the Food & Hotel Asia tradeshow (5–8 September 2022).

Competitor analysis: Some importers and distributors are supplementing Australian beef shortfalls with meat from other countries, including Brazil, Argentina, USA, Canada. Indian meat volumes into South-East Asia have increased 25% year-to-date. In price-sensitive markets, more middle-income consumers are switching to pork and chicken for weekly consumption with red meat reserved for special occasions.

In Vietnam, similar to Indonesia, locally processed beef is popular in wet markets and preferred by local consumers due to perceptions of being more fresh (overnight slaughter, ‘warm’ beef). Plant-based protein companies featured prominently at the May THAIFEX tradeshow but product penetration in Thailand supermarkets remained very low.

MENA

COVID-19 update: COVID restrictions continue to ease across the Middle East region. Most have dropped all COVID restrictions and testing requirements (such as KSA, Kuwait and Oman), while others still have some restrictions in place – UAE and Qatar still require masks to be worn indoors, and Qatar also requires PCR tests prior to entry into the country. Rules are continually being updated so checking the market requirements before travel is still important.

Market access: Priorities for market access continue to focus on increasing chilled shelf life for vacuum packed beef, with Bahrain and Kuwait now moving to 120 days, and AMPC led research has been completed to support increasing the shelf life for frozen livers in Egypt to at least 10 months.

MLA activity: Regional tradeshows have returned to MENA, with MLA supporting trade stands at HORECA Oman, and the inaugural Saudi Food Expo, with 5 exporters also attending. There has also been a return to core MLA training activities, hosting over 150 importers in Australian Meat training workshops in KSA, Qatar and Kuwait, and two culinary immersions have been hosted in Riyadh KSA, and Doha Qatar. The first MENA Lambassadors from Jordan and the UAE joined the rest of the global Lambassadors on their tour to Australia in May.

Sector analysis: Food service is still strong across the key markets in MENA, with the UAE hosting high profile awards from Michelin, and Gault and Millau in June, with several Dubai restaurants receiving stars. With the FIFA World Cup coming to Qatar in December, the associated sports tourism looks to provide a lift in service throughout the region.

Competitor analysis: The Middle East experienced the first ‘normal’ Ramadan in 2 years, with large family iftars and charity tents permitted, but with the challenges of increasing prices, freight logistics and tight supply of Australian lamb, meant that lamb has been increasingly sourced from other markets.

North America

COVID-19 update: The USA has moved towards a fully open posture. This includes abandoning mask mandates in many states and relying on vaccination as the major public health control measure. Almost 71% of the USA population ages five years and older has completed their primary vaccine series. Most states have restaurants fully open, with mask wearing variable, largely left up to individual businesses.

Market access: The struggles of supply chain logistics and high prices have continued to restrict the flow of Australian beef into North America. Beef exports to the USA rose by 10% from April to May, however declined by 6% year-on-year to 10,992 tonnes. However, the USA was Australia’s largest destination for lamb in May 2022 with 7,201 tonnes of lamb exported in May, a 9% year-on-year increase.

MLA activity:

Activity	Location	Timing	Purpose
Summer campaign for beef	Key target cities/regions	June-Sep	The ‘Eat Better, Feel Better’ campaign speaks to consumers desire to eat well and be healthy during summer and promotes healthy recipes involving grassfed beef.
Canadian chef Lambassador event	Greater Toronto region	July	To leverage the recently recruited Lambassadors to promote Australian Lamb amongst new networks in foodservice.
Grassfed beef and lamb promotion with chefs in target cities	Boston and New York	August	To promote Australian beef and lamb on menus as a limited time offer.
Flavor Experience & MISE conferences	San Diego and Atlanta	August	To demonstrate how grassfed beef and lamb can be integrated in the menu of chain foodservice operations and hotels.
Foodovation event	Bluffton	September	To network with key decision-makers at target foodservice operations to demonstrate the credentials of grassfed beef and lamb to build awareness of and preference for these categories.

Sector analysis: The meat department (all meats) in the USA experienced 13.2% higher year-on-year inflation in March 2022. All meat dollar sales were up 6.2% while volume sales were down 6.2%. However, some categories including grassfed beef appear less impacted by inflation. The retail sector is facing historically low fill-rates so out-of-stocks are also impacting volume sales. Foodservice has reopened and consumer demand remains strong.

Competitor analysis: Australia’s share of beef imports to the USA for period January to April 2022 was 10%, down from 12% for period January to April 2021. Brazil’s market share has grown significantly. Australia continues to dominate market share in lamb, particularly at retail. Australia’s share of mutton, goat and lamb imports to the USA for period January to April 2022 was 77%, up from 76% for period January to April 2021.

Europe and the UK

Market access:

Australia-UK Free Trade Agreement (A-UK FTA): With the agreement signed at the end of 2021, the A-UK FTA is now undergoing domestic ratification processes in the Australian and British parliaments. It is anticipated that the agreement will enter into force in the latter part of 2022.
Australia-European Union Free Trade Agreement (A-EU FTA): Following the twelfth round of A-EU FTA negotiations in February 2022, it is anticipated that the thirteenth round will be held in Brussels in mid-October 2022.

MLA activity: MLA activity has focused on advocacy around the A-UK and A-EU FTAs – engaging with policy makers and trade influencers to provide balanced insight into the role of Australian red meat products to support UK and EU consumer requirements for high quality imported beef and sheepmeat products.

MLA also released a UK market research report Opportunities for Australian red meat in the UK, identifying key research insights and opportunities for Australian exporters with an interest in the UK market. For more information, please contact the MLA Europe office.

7 March 2022

China

COVID-19 update: Despite the Omicron variant being recorded in China in December 2021, Chinese public health experts voiced confidence in their country’s ability to tackle the new variant. Beijing hosted the Winter Olympics in February 2022, so health authorities have ordered stricter protocols in port cities. Most local authorities have also advised residents to avoid travel over the holidays unless absolutely necessary, suggesting limiting the scale of festive celebrations involving large crowds to keep the pandemic in control. As of December 2021, 2.7 billion doses of COVID-19 vaccines had been administered in China.
Market access: It’s required to strengthen the risk prevention of imported cold chain foods for the purpose of control of COVID in port cities, reported by the State Council. Centralised supervision warehouses to test and disinfect uniformly is suggested to build in port cities which relevant companies to implement the control requirements of cold chain food entry, and production, etc. to better promote the traceability of the entire chain.
Competitor analysis: In 2021, China imported 2.2782 million tons of landed frozen beef, 209,100 tons more than in 2020. Until the end of 2021, Brazil continued to be China's number one beef importer with 30% market share, with landed volume up 42% in December from last month. Since China lifted its suspension on Brazilian beef in December 2021, the huge backlog of Brazilian beef in previous months has been largely cleared. Also, Brazilian live cattle prices have been hitting record highs, mainly driven by the recovery of exports and high demand for beef in China. Uruguay was the second largest beef importer in China with 24% market share. Although Argentina was still the third largest beef importer in China with 16% market share, it was the only country reporting declines in importing volume for 20%. New Zealand was the fifth largest beef importer with 7% market share. United States of America was the sixth largest beef importer in China with 6% market share, with landed volume up 9% in December from November.
MLA activity: 27 articles/posts and 18 videos have released on five MLA-owned social media channels since December. Also, MLA China conducted five online and offline events and 42 food sampling activities including the Australian Beef & Lamb Festival, two roadshows, retail VIP member tasting event and celebrity chef home cooking livestreaming show.
In December, MLA China launched Australian Beef & Lamb Festival on JD.com with 7 brands participation. A KOL Christmas livestreaming and a series of promotion were carried out during Festival with over 313 million consumer exposure. At the beginning of 2022, partnering with Ole – a key high-end chain supermarket, 2 roadshows in shopping mall and 1 VIP member tasting event were held in 3 cities in southern China and over 49k consumers were impacted onsite. Before Chinese New Year, a celebrity chef Jacqueline cooked 7 dishes new year dinner at her home with KOL livestreaming.

South-East Asia

COVID-19 update: Despite increased COVID-19 cases, with 60–90% vaccinations coverage across most South-East Asia, governments are not reinstating strict measures, opting for a more balanced approach between health and economy. Tourism and business travel is expected to rebound in the second half of 2022, with Thailand and Indonesia gearing up for more international arrivals on the back of APEC and G20 activities. 
Market access: Supply availability and logistic issues are the main problems impacting trade currently. Increased passenger flights would help with airfreight capacity, Vietnam has resumed international fights in February. Currently there is still product shortage for graded beef and lamb, particularly loins/racks, prime cuts and grain-fed beef including Wagyu. Chilled beef and lamb have remained scarce due to freight issues.
Indonesia permits have started flowing, delayed in part due to new IT system. To manage high beef prices, the Indonesian government may revisit options to import livestock from countries such as Mexico and Brazil. Brazilian cattle imported into Vietnam are still being cleared through the traditional markets. There is no firm plan to bring in another shipment at this stage.
Sector analysis: Hospitality and Foodservice sector had benefited from end-of-year and Lunar new year festivities and domestic travel. There is growing appetite for high-value and premium brands, supported by the rise of trendy food joints catering to discerning, affluent clientele. Despite inflation concerns, retailers are generally optimistic about 2022, with several chains continuing their expansion plans (e.g., Thailand CP group) and incorporating new gourmet and express concepts (e.g., Philippines Robinsons group). More effort is being placed into sustainable sourcing of products in Singapore. The trade is also anticipating rapid sustained growth in ready-to-cook and ready-to-eat products, with consumers now more familiar with online shopping and deliveries. 
Competitor analysis: ASF is still driving pork prices up in Philippines and Thailand, providing opportunities for Australian red meat. Other country suppliers are also becoming more competitive, e.g., European Union and Canada into Philippines; Canadian beef into Vietnam has increased by around 40% to just over 10,000 tonnes in 2021 (source IHS); and Thailand has seen a surge of products coming in from newer suppliers such as New Zealand, Russia and European Union.
MLA activity: From February – April 2022, Chef tables and TABL launch events are planned in Thailand and Vietnam, followed by retail promotions to coincide with Songkran and Ramadan. Online activations would include the ‘Taste of Tradition’ recipe series featuring local heritage dishes cooked with Australian beef and lamb. Jakarta Great Steak Escape campaign is underway 1-31 March, featuring 24 restaurants.
MICE activities resumption enabled MLA to take part in the October 2021 International Business Summit in Selangor Malaysia. MLA would be participating in The Food and Hotel Asia, set to take place on 1-8 September 2022 in Singapore.

Middle East and North Africa (MENA)

COVID-19 update: Normalisation is now occurring across most countries in the GCC. International regional travel is continuing to become easier for vaccinated passengers, with most countries no longer require any form of home quarantine and/or PCR testing on pre-departure or arrival. Capacity limits for venues were lifted to 100% in UAE in time for Gulfood and masks are no longer required outdoors.
Market access: Development of a Free Trade Agreement between Australia and the GCC has been stalled for several years, but it has now been prioritised by the Australian Government and development should begin in June this year.
The start of 2021 has seen the shelf life for chilled vacuum-packed boneless beef and lamb in Egypt move to 98 days (from 49 days), while development continues with Bahrain, Qatar and Kuwait to improve the chilled beef shelf-life requirements to 120 days.
Sector analysis: Retail wet sampling is now able to begin again, with sampling activities underway before in Qatar (Lulu), KSA, (Danube) and UAE (Choithrams, Lulu) during March.
A training program for junior chefs is underway across MENA culinary academies, with promising students invited to attend a 2-day Aussie Beef and Lamb Masterclass in Dubai in March. At the end of the class a Junior Lambassador will be selected to take part in the 2022 Lambassador trip to Australia.
Competitor analysis: While pricing and freight making it hard for Australia, it appears to be impacting other countries more. It’s evident that there is now much less New Zealand and USA product in the marketplace. There are still many different countries of origin evident across several retailers for lamb (Eastern Africa, Eastern Europe) and beef (India, Pakistan, Brazil, Colombia) but Australian product is consistently available across most of the major tier 1 retailers in MENA.
MLA activity: Dubai Expo is winding up in the last week in March after a six-month program. It’s shaping up for a large final month with COVID restrictions easing. MLA will be running a global launch of the Lambassador program at the Australian Pavilion on 17 March, with Lambassador chefs flying in from several countries to attend this ambitious showcase.
The first MSA consumer sensory panels to be held in MENA will be run in March, testing grainfed beef and Wagyu product with UAE consumers.
Work is currently underway for the seasonal Ramadan consumer campaign for 2022. All indications are that this will be the first ‘normal’ Ramadan since 2019, so a return to the traditional large scale Iftars and charity tents is expected.

North America

COVID-19 update: After the brief but significantly impactful omicron wave, which appeared to peak around the end of January, the USA is moving towards a fully open posture, as COVID-19 restrictions fatigue has set in. This includes abandoning mask mandates in many states and relying on vaccination alone as the major public health control measure. Vaccination rates in the USA appear to have levelled off and sit well below some other advanced western nations at around 65%. Availability is not the issue, rather freedom of choice. Most states have restaurants fully open, with mask wearing variable, largely left up to individual businesses. Vaccination status is also required to enter some restaurants or premises.
Market access: In general, 2021 was a difficult year for Australian beef product into North America with supply and price challenges. This continues to be the case in early 2022. Manufacturing beef export volumes continue to be significantly down. Australian lamb volumes continue to set records and 2021 was a bumper year, and volumes continue to be strong into 2022. Goat has also started the year strongly after a relatively subdued 2021, mainly due to supply. Shipping issues continue to be difficult into 2022 and the import industry and MLA is keeping a close eye on this issue.
Sector analysis: The positive economic and consumer outlook continues with unemployment rates at near record lows at the beginning of 2022. The reopening of foodservice across the USA is basically done and consumer demand continues to be strong. While food service has bounced back to pre-COVID levels in terms of revenue, labour continues to be the biggest challenge for both this sector, and many others including slaughter plants. Overall consumer demand for both beef and lamb is strong, and retail continues to perform well, with the most serious issue being rising food inflation. This is expected to temper throughout 2022 but growth in CPI remains strong so far.
Competitor analysis: Australia’s position as the premium beef offer continues to be threatened by Central and South American countries, although the focus on China has blunted South American penetration into the US. It will be interesting to see how much market share Australia loses overtime on manufacturing beef, especially to the relatively new South American entrants who are placing a lot of products into the US, for example Brazil. With lamb, Australia continues to dominate the market share, particularly at retail, and with demand so strong the future appears very bright, despite the new entrants into the market, for example the UK. Domestic production continues to be lacklustre with low flock numbers no threat to Australia’s dominant position.
MLA activity: MLA’s key pulse period consumer campaigns towards the end of 2021 took advantage of tailgating with the football season, all the way through to the Superbowl. In that period the holidays also featured with Thanksgiving, Christmas and then moving into the New Year, New You campaign. Both beef and lamb were featured in these campaigns.
TABL sponsored Metro Cooking DC, a consumer-facing food show that featured two lamb cooking classes attended by 30 consumers each; and a grassfed beef ‘taste talk’ hosted on the main stage, drawing a crowd of around 40 consumers to highlight simple, elevated and healthy meals using grass fed beef.
At the end of January, TABL hosted 18 chefs in Atlanta for a chef’s immersion, focused on country club chefs. The event was highly successful, showcasing grassfed beef, lamb and Wagyu. Preparations are underway for another chef’s immersion in Ohio in March, targeting Canadian chefs with a focus on lamb.

Europe and the UK

COVID-19 update: While the Omicron wave had a significant impact on the UK and Western Europe over Christmas and into January and February, we’re now seeing a decrease in case numbers and shift in policy with governments adopting a “living with covid” approach. Restrictions and rules are still managed on a country-by-country basis, so situations do differ, however overwhelmingly we’re seeing a removal of work from home guidance and mask mandates, as well as an increase in demand at food service2, tourism and in central business districts. Other covid-derived issues remain however, with availability of product and shipping delays causing significant supply chain challenges, and alleviation highly unlikely in the short-term.
Market access:
- Australia-UK Free Trade Agreement: In positive news at the end of 2021, the A-UK FTA was signed on 17 December, following agreement in principle earlier in the year. The A-UK FTA will see Australian beef and sheepmeat/goatmeat access to the UK liberalised over a transition period, providing an opportunity for Australian exporters to supply some of the UK’s demand for quality import red meat products. The agreement is currently going through the UK and Australian domestic parliamentary ratification processes, with the Australian and UK Governments indicating ambition for entry into force to occur in the second half of 2022.
- Australia-European Union Free Trade Agreement: Early 2022 has seen progress made on the Australia-EU FTA negotiations, with a twelfth round held in February. Progress was made on Geographical Indications, Trade and Sustainable Development and SPS and Animal Welfare chapters. A date is yet to be set for the thirteenth round – anticipated to be after the European summer.
MLA activity: MLA continued in-market support of the FTA negotiations, engaging with policy makers and trade influencers to provide balanced insight into the role of Australian red meat products to support UK and EU consumer requirements for high quality imported beef and sheepmeat products. MLA has also invested in a range of insights to support Australian producers, processors and exporters in exporting the future potential of the UK market, in order to take advance of the new market access gained via the A-UK FTA. For more information, please contact the MLA Europe office.

Korea

COVID-19 update: Korea has reported Omicron cases between 140,000 to 219,241 cases per day, leading to slow domestic sales of red meat.
Many industries are struggling with the rate of infections, especially in the meat processing sector. However, social distancing requirements are easing and the 9pm curfew restriction has been changed to 10pm with the government planning to ease this further in the coming weeks.
Market access: The imported beef market is expected to be challenging this year due to the high price of US beef and the limited supply of Australian beef. Conversely, the price of Hanwoo is expected to drop due to an increase in slaughter.
Transport and the delay of imports remains high. The new quota year has started with the duty at 16.1% for beef products (except offals) and quota ceiling of 181,120t for Australian beef.
Sector analysis: During the Lunar New year holiday season, domestic sales were slow in Korea. Retailers are reporting a rise in prices across most cuts, including ribs. Demand for holiday gift sets has gradually declined. Online retailers recorded high sales during this year's Lunar New Year holiday (first week of February 2022). Coupang reported that sales of all proteins, including Australian beef, increased by more than 70%. SSG.COM also recorded a 50% increase in sales. Among them, it has been reported that the growth rate of Australian beef was 100% and 40%, respectively.
Foodservice sales are slow due to recent Omicron cases. These businesses have also faced the pressure of high beef prices recently.
Competitor analysis:
- The 2021 domestic cattle kill was 872,000 head (Hanwoo was 794,000) which is a 4.5% increased year-on-year.
- Production was 264,000t, a 6.1% increased year-on-year.
- The domestic cattle herd increased to 3,585,000 (5.6% up year-on-year).
- Hanwoo herd numbers are estimated to be at 3,408,000 herds.
- Total supply of beef was 716,000 in 2021, with domestic beef market share at 36.8%.
- Beef imports:
  - Australia beef imports were 160,000t (22.3%).
  - US beef imports were 255,000t (35.6%).
  - Other origin imports were 38,000t (5.3%).
  - Total beef imports to Korea in 2021 was 453,000t.
- Hanwoo average wholesale price is 21,169KWN/per KG in 2021 which is 6.4% up yoy. In 2022, Hanwoo wholesale market price has decreased to 19,185KWN/per KG as 9.4% down due to increase volume of kill in 2022.
MLA activity: MLA had a Kuk Cook Campaign in Q2 2021(15 Nov - 26 Dec) on TVC and digital channels, reaching 25 million viewers. McDonalds is currently running a TVC and digital promotion which focuses on ‘country of origin’ and showcases Australian production and nature to Korean consumers. The campaign will runs from 27 Jan – 30 March 2022.

Japan

COVID-19 update: Korea has reported Omicron cases between 140,000 to 219,241 cases per day, leading to slow domestic sales of red meat.
Many industries are struggling with the rate of infections, especially in the meat processing sector. However, social distancing requirements are easing and the 9pm curfew restriction has been changed to 10pm with the government planning to ease this further in the coming weeks.
Market access: The imported beef market is expected to be challenging this year due to the high price of US beef and the limited supply of Australian beef. Conversely, the price of Hanwoo is expected to drop due to an increase in slaughter.
Transport and the delay of imports remains high. The new quota year has started with the duty at 16.1% for beef products (except offals) and quota ceiling of 181,120t for Australian beef.
Sector analysis: During the Lunar New year holiday season, domestic sales were slow in Korea. Retailers are reporting a rise in prices across most cuts, including ribs. Demand for holiday gift sets has gradually declined. Online retailers recorded high sales during this year's Lunar New Year holiday (first week of February 2022). Coupang reported that sales of all proteins, including Australian beef, increased by more than 70%. SSG.COM also recorded a 50% increase in sales. Among them, it has been reported that the growth rate of Australian beef was 100% and 40%, respectively.
Foodservice sales are slow due to recent Omicron cases. These businesses have also faced the pressure of high beef prices recently.
Competitor analysis:
- The 2021 domestic cattle kill was 872,000 head (Hanwoo was 794,000) which is a 4.5% increased year-on-year.
- Production was 264,000t, a 6.1% increased year-on-year.
- The domestic cattle herd increased to 3,585,000 (5.6% up year-on-year).
- Hanwoo herd numbers are estimated to be at 3,408,000 herds.
- Total supply of beef was 716,000 in 2021, with domestic beef market share at 36.8%.
- Beef imports:
  - Australia beef imports were 160,000t (22.3%).
  - US beef imports were 255,000t (35.6%).
  - Other origin imports were 38,000t (5.3%).
  - Total beef imports to Korea in 2021 was 453,000t.
- Hanwoo average wholesale price is 21,169KWN/per KG in 2021 which is 6.4% up yoy. In 2022, Hanwoo wholesale market price has decreased to 19,185KWN/per KG as 9.4% down due to increase volume of kill in 2022.
MLA activity: MLA had a Kuk Cook Campaign in Q2 2021(15 Nov - 26 Dec) on TVC and digital channels, reaching 25 million viewers. McDonalds is currently running a TVC and digital promotion which focuses on ‘country of origin’ and showcases Australian production and nature to Korean consumers. The campaign will runs from 27 Jan – 30 March 2022.

27 October 2021

Download a PDF of updates here.

China

COVID-19 update: The pandemic is well under control, and the economy is robust. In the majority of areas, life is close to normal as it was before the outbreak. With strict pandemic measures, travel restrictions and quarantine policies, China has successfully controlled the spread, which has led total existing cases to drop to 645. As of August, more than 2 billion doses of COVID-19 vaccine had been administered. Due to cases of the highly contagious Delta variant rising and raising concern throughout the country, China has pushed to boost vaccination rates since July. Officials have announced that Delta is also under control.
Market access: Due to the political environment and diplomatic situation, Australia faces the toughest regulatory measures across product types in the customs. Challenges remain in the clearance process as there are complex checking procedures in customs due to a perceived association between the cold chain and spread of the virus. Although it’s unknown when the challenging access situation will end, the demand for Australian meat remains strong at both the trade and consumer level in China.
Competitor analysis: Despite that overall volume growth of Australian meat has slowed down, the demand for both import beef and lamb continues to grow. The total volume of imported beef for the past eight months has reached almost 1.5 million tonnes, an increase of 9% over the same period in 2020. It’s predicted to maintain an imported beef volume of 190,000–200,000 tonnes on monthly basis over the following months. The restriction policy on Argentina has had ongoing impacts regarding its export volume, causing a 33% decrease overall and an 8% drop of market share in China. Despite the blockade on Brazilian beef due to the atypical cases of mad cow, its overall export volume grew 1.5% annually. This is due to beef that had a production date prior to the ban being released still being exported to China, although the impact of the ban is expected to be seen at the end of October and going forward. The US and NZ have increased by 1% and 3% in China’s imported beef market share.
MLA activity: Since September, MLA has released 14 articles and reports, nine videos on MLA owned social media channels and launched a tradeshow (CIMIW), while maintaining continuous marketing campaigns on retail & E-commerce channels. At CIMIW, held by CMA on 15–17 September, MLA put up a booth and held one livestreaming event to promote True Aussie Beef & Lamb. Moreover, a True Aussie JD pilot store soft launched in September, as MLA has partnered with JD Fresh, a major E-commerce platform in China. Around 20 Australian beef and lamb products were selected to be displayed in-store, while more products will be evaluated for admission to the store.

Korea

COVID-19 update: In recent weeks, COVID-19 cases have slowed, with average daily cases at 1,519, although social distancing level 4 restrictions are still in place in the Seoul Metropolitan Region (other cities are at level 3) until 31 October 2021. There are some benefits for the fully vaccinated, including eight people allowed together for dining. The government is planning for a ‘living with COVID’ scenario which begins on 1 November when social distancing restrictions will be eased. On 19 October, 78.7% of people had received 1 dose of vaccine, with 64.6% fully vaccinated.
Market access:Shipping delays, transit country ports delay and domestic port berth waiting times are still some of the main issues for trade, with limited shelf life for chilled beef and short supply for retail and the e-commerce market. Those issues are still creating problems for 20–30% of chilled beef products. Australia’s beef quota usage was speeding up in August due to higher currency rates for early applications on customs clearance. By 19 October 2021, the quota spent was 88.52%, with 20,390 tonnes leftover (in 2020, on 26 August the quota spend was 89.29%, with 18,646t leftover), which means the safeguard will be triggered at a similar time (triggered 25 November 2020). When Australia triggers the safeguard, the tariff will be increased from 18.6% to 30%.
Sector analysis: During the Choosuk holiday season, traditional markets and small businesses boosted their sales, with short rib sales in retail up compared to February (which was the lunar New Year holiday). Most foodservice sales dropped for more than two months since July, but are recovering with the boost from the government subsidy. Most foodservice businesses face the difficulty of recent high beef prices. Burger chains are still quiet on imports of trimming in Q3, with a year-on-year decline of 48% on those cuts. Small-mid size importers are trying to reduce sales of beef to plan for further price increases on imports.
Competitor analysis: US frozen chuck eye roll prices dropped from September, but their chilled beef export price is unchanged. The US Meat Export Federation (MEF) is running a foodservice promotion with 25 individual restaurants for delivery service, where once you order a meal you receive free grilled and peeled chestnut. The Hanwoo Board Association is running Youtube content from September to October.
MLA activity: MLA had an online retail promotion in Q1 with Coopang, SSG.com and Lotte mall for one week each that generated 10,422,318 views and Australian beef sold out A$1.2 million, which represented increases of 285%, 45% and 220% YOY for each store. The second edition of Kuk Campaign is on track to launch on 15 November for six weeks, with six major online retailers joining the collaboration from 18 November.

South-East Asia

COVID-19 update: Key South-East Asia (SEA) countries are rolling out vaccinations and daily COVID-19 case numbers are declining. Vietnam emerged from lockdown on 1 October, with shops reopening and people able to move around without permits. Singapore expanded its quarantine-free travel with 10 countries and others are progressively relaxing the quarantine requirements. With the case numbers more under control, the priority is shifting towards economic recovery, given that almost all countries experienced a comparatively weaker third quarter GDP growth.
Market access: The Philippines Bureau of Animal Industry has extended the transition period for mandatory inclusion of expiry dates on exporter labels until 31 December 2021, after which consignments without the appropriate labels would be detained. Market access advice has been circulated by DAWE. Malaysian health authorities are still requiring importers to affix an ‘imported by’ label on meat and meat products. It is agreed that this can be done in-country, prior to sale at retail. Industry association is continuing to make representations to various government agencies.
In Indonesia, a bilateral meeting was held in mid-October to discuss and harmonise the approach for virtual audits for meat and rendering establishments. With international borders reopening, Indonesia is starting to prepare for on-site audits with other countries.
Competitor analysis: US beef import volumes into key SEA markets have increased about 19% for the calendar year-to-date (source: IHS). The bulk of this is in the form of manufacturing beef and fancy meats into the Philippines and Indonesia. In high-end retail and foodservice, Australian beef and lamb still feature prominently. Due to limited product availability, exacerbated by logistics issues, some businesses have had to temporarily switch to other brands or countries. The first ever shipment of Brazilian cattle into Vietnam is starting to be sold into the market, however, generally beef demand in the country has remained very subdued due to the lockdown and weakened economy. There is no firm feedback on the performance of the cattle and beef quality at this stage. The September shipment landed US¢40 cheaper than Australian live cattle.
Sector analysis: Modern retail has held up well in key markets within SEA in the last two months except Vietnam. Modern brick-mortar retailers are seeing more competition with online establishments, and some have expanded their digital presence and services (e.g personalised shopper via mobile apps or expansion of distribution centres and cold chain transport for guaranteed fresh and safe delivery). Some high-end supermarkets have also revamped their store concepts and product offering (e.g. branded gourmet deli and butchery, customised meal kits and subscription packages). The foodservice sector is recovering compared to two months ago as more dine-ins and events are being allowed. Restrictions on numbers and operating hours and frequent changes in measures are still hampering the ability to forward plan.
MLA activities: As part of ongoing trade and customer education, True Aussie Academy workshops were conducted for Greater Jakarta’s seven retail chains, covering over 50 stores and 20 key foodservice accounts. The sessions covered topics such as retail category management and innovative food solutions. Physical/hybrid True Aussie Academy sessions for other countries will resume in early 2022. The major marketing campaign for 2021–22 will highlight key attributes significant to SEA consumers – great taste, consistent quality and goodness through “Oz, It’s Just Better”. Upcoming end-of-year activities include retail promotions, Lambassador and Chef’s table events with over 20 restaurants across SEA.

MENA

COVID-19 update: With high levels of vaccination across Gulf Corporation Council (GCC) populations, restrictions are continuing to ease. Wearing masks outdoors have been dropped in Saudi Arabia and Kuwait, and Saudi Arabia has also dropped social distancing and capacity restrictions for weddings, major events and foodservice. Kuwait has now opened its borders and its airport to full capacity, which means there is now quarantine-free travel across all GCC countries for fully vaccinated travellers.
Market access: Focus continues on advocating for chilled shelf-life changes in beef from 90 days to 120 days in Kuwait, Qatar and Bahrain, as sea freight delays continue to make reliable supply to these markets increasingly challenging. Work has also continued on the frozen shelf life NTB in Saudi Arabia, with research managed by MLA indicating that beef and lamb can be frozen for up to three years without any detrimental effects.
Sector analysis: With the end of the Middle eastern summer, major regional events are starting up around the region to drive both domestic and international tourism. Expo2020 has started in Dubai and will run for six months, finishing on 30 March 2022, with the Australian pavilion being a highlight. 1 million visitors have attended Expo in the first three weeks. The Seasons program in Saudi Arabia has relaunched, with the opening of Riyadh Seasons seeing over 200,000 people celebrate in the street. Major sporting events are running over the next two months, with the UAE hosting the ICC T20 World Cup and Saudi Arabia and Qatar both hosting an F1 grand prix for the first time. All of this should see demand in foodservice for premium Australian beef and lamb continue to grow in these markets.
Competitor analysis: Lamb from eastern Europe (Romania and Georgia) and northern Africa (Sudan, Ethiopia and Tanzania) continues to grow its presence in the market due to favourable price points. Premium Russian beef from Miratorg has now established itself in Saudi Arabia as a direct competitor, while grainfed Brazilian beef has also made an appearance in this market.
MLA activity: Retail campaigns have been underway in Saudi, with a ‘Back to School’ campaign finished and BBQ campaigns about to start, with the promise of resuming wet sampling soon. With borders opening, the importer training programs are underway, with activities planned for Jordan, Abu Dhabi and Riyadh this quarter. MLA is also supporting the VIP chef program at the Australian Pavilion at Expo, with a guest chef preparing menus every month.

Europe and the UK

COVID-19 update: With the introduction of a range of means, including mandatory COVID testing and vaccination passports to manage travel in Europe and the UK over the summer, the tourism sectors were able to function with relative stability and many COVID restrictions were abandoned. Moving into the autumn, parts of eastern Europe and the UK are seeing a spike in cases and a range of restrictions are being reintroduced to manage case numbers.
Market access – A-UK FTA: Following the agreement in principle (AIP) of the parameters of the Australia-United Kingdom Free Trade Agreement (A-UK FTA) in mid-June 2021, negotiations continued to convert the AIP into the official text. Australian Minister for Trade, Dan Tehan, travelled to the market and met with his counterpart, Anne-Marie Trevelyan, in mid-October. They continued to work towards finalising the negotiations, with an ambition of formally signing the agreement later in the year, followed by ratification of the agreement via the respective parliamentary processes.
Market access – A-EU FTA: Virtual negotiating rounds have continued between the EU and Australia on the Australia-EU Free Trade Agreement (A-EU FTA), with the eleventh round held in June 2021. A twelfth round is provisionally scheduled for the end of 2021, however, a date is yet to be set.
MLA activity: MLA continued in-market support of the FTA negotiations, engaging with policy makers and trade influencers to provide balanced insight into the role of Australian red meat products to support UK and EU consumer requirements for high quality imported beef and sheepmeat products. The Anuga trade show was held in Cologne in October, with positive reports from attendees who valued the opportunity to meet customers, in many instances for the first time in two years. MLA didn’t host a stand-alone trade show this year, with Australian exporters largely unable to attend, but did have the opportunity to share some stand space with Austrade’s Europe representatives.

Japan

COVID-19 update: The State of Emergency (SoE) lifted in October as new infections rapidly declined. This led to an easing of restrictions for bars and restaurants, with a view to completely remove these by November. Restaurant operators are cautiously optimistic, though labour shortages may slow reopening for some stores in the short-term.
Trade and market access: Shortened business hours for foodservice and rising prices have kept orders in the trade sluggish, however, with easing restrictions improvements are being seen. Supply chain disruptions continue to be a general concern, though not to the extent seen at the beginning of the year. Recently, there has been an increase of non-meat protein products entering the market, with many major meat companies selling or producing these new products. End users are beginning to show an interest in sustainable, socially considerate product information and education for their teams.
Sector analysis: Foodservice is starting to see a recovery following a lengthy, difficult SoE period. Notably, the boom in popularity of western style quick service restaurants has continued, however, total food sales overall were down 8.6% year-on-year to August, and down 24.4% on pre-pandemic levels. In September, retailers continued to operate on reduced in store promotions due to COVID-19 restrictions. Consumer demand remained strong owing to the preference for in-home consumption. Rising food prices were positive for retailers, with a stronger sales performance, though a trend towards cheaper proteins like chicken and pork is expected in September and October. Lamb demand is strong in retail and will recover further as foodservice reopens. Supply constraints remain a concern and may impact performance in the short-term.
Competitor analysis: USMEF conducted an online foodservice seminar influencing operators to include steak as a regular menu item. Consumer social media activities were also held in the quarter, engaging consumers with prize draws and incentivising the following of their official SNS accounts. Irish government-affiliated beef specialists held a seminar for professional chefs to showcase the advantages of grassfed beef. Annual Irish beef exports to Japan have reached JPY290 billion (A$3.5 million).
MLA activity: MLA’s major consumer campaign ‘Let’s Barbie’ wrapped up at the end of September. The campaign generated significant value for Aussie Beef in the market, with a PR value of A$28.65 million. The TVC-focused campaign aired nationwide, targeting viewers during the Olympic period and achieving a total reach of over 95 million viewers. The TVC content performed in the top 25% of all TVC’s during the Olympic period and delivered key messages aimed at growing purchase intention.
MLA will soon commence extensive in store promotions with bespoke sauce giveaways in all key retail accounts. The campaigns target a period of increasing demand in the winter season for Australian beef and aim to generate an additional 200 tonnes/JPY800 million (A$ 9.7million) in sales growth year-on-year.
Steak restaurants such as Sawayaka, Ikinari and Skylark will proactively promote Aussie beef from November with consumer prizes and menu promotions. BBQ events delayed due to the SoE have also returned in October.
Looking ahead, the Hitsuji Festival 2021 is to be held on 6–7 November. This is the largest sheepmeat event in Japan run by the consumer group, Hitsuji Kajiri Association, to encourage eating sheepmeat in Japan. MLA is the main sponsor and Lambassadors will have their own stand serving lamb curry and assorted dishes.

31 August 2021

Download a PDF of updates here.

China

COVID-19 update – Overall, COVID-19 has been well controlled throughout the country, with single digit total daily increase of new cases. There are a total of 867 existing cases in China as of today, with the vast majority in the two cities of Nanjing and Yangzhou. Lockdown measures are implemented in the high-risk areas and some travel restrictions are applied on passengers to and from the medium to high risk areas. Nationwide vaccinations are being rolled out in a highly organised fashion at the community level. The government planned to have 900 million vaccines administered by end of July, but well exceed this target and completed a total of 1.6 billion shots. However, the efficacy rate of the vaccine has clearly dropped on the new Delta variant and the necessity of a booster shot is being evaluated.
Market access – The customs clearance process remains slow due to extensive sanitisation and checking procedures throughout the country. There are reports that the Shanghai port has a “go-slow on AU” mandate which caused even worse delays. While the backlog situation is real, we have not been able to confirm or disaffirm the mandate.
Competitor analysis – Beef demand in China remain strong, with total beef imports continuing to grow in the first half of 2021. Imports of frozen beef reached a total landed volume of 1.11 million tons, an increase of 14.2% over the same period in 2020. The growth rate represents a much slower trajectory compared to past three years, but it is predicted to pick up in the next two months, with total landed volume of about 190,000 tons expected. Argentina’s export restriction policy has shown its impact, creating a 20% decrease in exports to China, but the impact has almost been entirely compensated for by increases from Brazil (+11%) and Uruguay (+21%). In June 2021, the average CIF price to China continued to rise to 4.95US$/kg, higher than it was in 2019. The US has taken over Australia to become the fifth largest supplier to China since May.
MLA activity – The 2021–22 financial year kicked off strongly, with quite a full schedule of both online and offline activities. Since July, we have published 10 articles and reports on MLA’s WeChat channel, nine videos, one foodservice campaign featuring 23 top tier restaurants and started off our first ever True Aussie Academy in China. The restaurant campaign, Australian Beef and Lamb Carnival, kicked off on 2 August with a media luncheon at the Mr. Willi’s restaurant, owned and operated by celebrated Australian chef, Craig Willis, who is also a True Aussie ambassador of MLA since 2019. We were also joined by Liu Bing, deputy Counsel General at Shanghai Consulate, and Heidi Dugan, a Brisbane born celebrity gourmet critic and TV anchor living in China for over 20 years. The list of the 23 participating restaurants includes some of the finest steakhouses, Western and Asian cuisine venues, all featuring a special menu of their signature dish of Australian meat. The True Aussie Academy is a collaboration of MLA with the celebrity chef, Clinton Zhu, and his Efun Culinary School. The project includes 10 sessions in a number of different cities across the country, where the participants will learn how to handle and cook Australian meat and be awarded a certificate upon completion.

Korea

COVID-19 update – From the middle of July, COVID-19 cases spiked in Korea. The government introduced the new social distancing rules from July 2021, and Seoul’s metropolitan regions have remained at the highest level 4 restrictions from 11 July. These restrictions will continue until 5 September, at which point they will be reviewed. Additionally, restaurants are open until 9pm, but only for those vaccinated with two doses. The restrictions have resulted in a number of business closures.
Market access – Shipping delays are still one of the main issues for trade, with limited shelf life for chilled beef and shortened supply for retail and the e-commerce market. Enhanced inspection of imported edible intestines came into effect on 1 January 2021 in response to growing concerns of foreign matter. For January to July this year, export of small intestines have recovered by 34% year-on-year, but large intestine trading volumes are still down 18%, due to partially failed cases. Australian beef quota usage is getting faster in August due to a higher currency rate for early application on customs clearance. Quota utilised 75.25% with 43,956t leftover, similar to 26 August 2020 at 75.51% with 42,635t leftover.
Sector analysis – Retailers and e-commerce retailers are still recording strong sales, even under the highest level 4 restrictions in the Seoul metropolitan regions and in other cities. However, limited imports and delayed products mean there is a struggle for supply. Most foodservice sales have dropped significantly with the new social distancing restrictions, but are pivoting with delivery options to recuperate some losses. In the case of Wagyu products, the supply is continuously limited, which has a negative impact on the market handling the products. Burger chains have less interest in purchasing beef trimming due to recent high prices, and are monitoring whether fluctuating prices make it reasonable for them to serve.
Competitor analysis – US beef prices are unstable. In July, there was a slight drop in some products prices (chuck items, clods), but from early August their export price jumped due to hoarding in the domestic market. USMEF supports the promotion of retail stores (E-mart) competing on sales, but limited supply and higher prices have created issues for physical sales.
MLA activity – Due to higher COVID-19 cases in-market, MLA has been required to delay some collaborations and promotions. In early August, MLA had a promotion with Coopang (Rocket Fresh) which saw sales increase by 177% for the week compared to the same time in 2020. There is an upcoming Chooseok (Thanksgiving day) promotion plan with the E-commerce market, and an autumn Campaign plan will be created before Nov this year. The Kuk Cook campaign is also being planned for expansion.

South-East Asia

COVID-19 update – There is still high daily official COVID-19 cases across most key South-East Asia countries, resulting in tightened restrictions. Singapore is the exception, with >70% of the population fully vaccinated. Differentiated measures (e.g. travel, dine-ins, access to shops) for vaccinated individuals are also starting to be applied in parts Malaysia and Indonesia.
Market access – There were delays in clearing containers in the Philippines due to labels not containing best before or expiration dates. Philippine meat importers and trade associations are making representations to their government on the sudden tighter enforcement of pre-existing minimum labelling requirements. Exporters can contact DAWE should they have concerns about the requirements. The Indonesian government has recently issued the regulation that would allow virtual audits of establishments and registered premises during the pandemic. In practical terms, it may take 3–6 months before Australian establishments can be assessed. MLA will be participating in the Malaysia International Halal Showcase virtual trade show commencing on 9 September and hosting trade webinars.
Competitor analysis – Higher value US beef’s presence has grown slightly in Thailand, Vietnam and Singapore. Buffalo meat import volumes are steady into Vietnam, Malaysia and Indonesia, with Indonesia considering allocating an additional 20,000 tonnes for the last quarter of 2021. For January to July 2021, live cattle trade is down 12.8% and 47.2% to Vietnam and Indonesia, due to the pandemic’s impact on the economy and cheaper frozen meat competition. In Indonesia, some feedlots have opted to temporarily halt operations.
Sector analysis: In Vietnam, strict stay-home orders have made it challenging to access food; logistics infrastructure was not able to keep up with online orders. Retailers are reporting variable sales – in Indonesia, the Philippines and Thailand, more middle-up consumers are buying less high-value items, including beef and lamb. In Malaysia, Australian red meat positioning in high end retailers continues to perform well even though the supply is inconsistent and limited. Across South-East Asia, sliced, diced, minced meat packs remain popular daily options in both online and offline retail settings, as consumers look for convenience and value-for-money options. More wholesale distributors are starting direct business-to-consumer options, (through online platforms for example), which looks set to continue even after the pandemic.
MLA activities – The 2021 financial year Beef Up campaign culminated with Singapore and Malaysia webinars attended by 107 participants and reported in 30 media sources. The Great Steak Escape campaign is underway in Singapore and Malaysia, involving over 30 restaurants, hotels and retail partners, and will be expanded to Thailand in September. August Margaret River Wagyu retail promotion is underway in Robinsons’ in the Philippines. MLA will be conducting a series of mini webinars across each of the key South-East Asia markets in mid-September, providing updates on the trade issues, red meat situation and trends.

MENA

COVID-19 update – Cases are slowly decreasing across the region due to large-scale vaccination programs. Quarantine-free travel is starting to open, with only a PCR test on arrival for the UAE and Egypt, while proof of vaccination is also required for entry into Saudi Arabia, Qatar, Oman and Bahrain. Vaccine passports are being used routinely in many countries to access activities such as shopping, attending weddings and events and attending school. The UAE has now moved off the UK red list, allowing greater travel between the two countries, which should provide a boost for tourism in the UAE. However, travel between the UAE and Saudi Arabia remains restricted.
Market access – Amanda Hodges has joined the MLA MENA team as the Trade and Market Access Manager, taking over the role from Spencer Whitaker. Amanda’s background includes leading business development teams for Austrade and more recently working in the private sector, advising agribusiness and healthcare industries in the Gulf.
Sector analysis – With travel opening between MENA countries and Europe, many Gulf Corporation Council citizens and residents have taken the opportunity to visit other countries over summer. As a result, the normal reduction in lamb and beef volumes over summer (July and August) has occurred, with trade volumes expected to pick up in September. Demand for premium beef remains strong across the UAE, Saudi Arabia and Kuwait, particularly for Wagyu cuts. Sea freight access to the Middle East is an ongoing concern due to container shortages and delays in shipping, while the cost of air freight continues to impact the chilled lamb carcase trade.
Competitor analysis – Lamb from eastern Europe and northern Africa have maintained a strong presence in the market, especially during the recent Eid holidays in July. The increased value of US beef has seen a reduction of supply of US Angus product in the UAE, Saudi Arabia and Kuwait. All competitors are also impacted by the ongoing logistic challenges around securing sea freight to the Middle East.
MLA activity – Damon Holmes has joined the MENA team as the new Business Development Manager, looking after the trade, retail and foodservice sectors. Damon brings a strong industry background with him, spending time in the MLA Market Insights team and more recently, the Integrity Systems Company in the traceability and food safety programs. MENA is also recruiting for a Business Consultant Manager to be based in Riyadh, KSA. This will be a dedicated resource to support new and existing trade within Saudi Arabia.

North America

COVID-19 update – The US is showing a lot more optimism as vaccination rates move quickly. However, COVID-19 case numbers are rising due to the Delta variant, especially in places where vaccination rates are lower. Most states are allowing restaurants to open at or near full capacity, but mask wearing is required for indoor venues and places in many states. The reopening of foodservice across the US is taking off and consumer demand continues to be strong, despite concerns around rising COVID cases.
Market access – In general, it has been a difficult year for Aussie beef product into North America, with supply and price challenges. Manufacturing beef export volumes were significantly down in Q2, however, there appears to be some bounce back in volumes for Q3, though still down significantly year-on-year. Australian lamb volumes have increased significantly in the past couple of months and the overall trade is likely to eclipse previous years at the current rate of imports, with a high demand.
Sector analysis – The positive economic and consumer outlook continues, with predicted unemployment rates going into 2022 at near record lows. Foodservice has bounced back well, but labour continues to be the biggest challenge for both this sector and many others, including slaughter plants. Overall consumer demand for both beef and lamb is strong, and retail continues to perform well, with the most serious issue being rising food inflation. This is expected to temper once the majority of government stimulus has stopped in the last quarter of 2021.
Competitor analysis – Australia’s position as the premium beef offer continues to be threatened by Central and South American countries, although the focus on China has blunted South American penetration into the US. In the near term, our competitors do not appear to be taking significant market share; rather, the market is tight with supplies, especially for lean trim. However, medium- to long-term trends suggest Australia could lose significant market share overtime. With lamb, Australia continues to dominate the market share, particularly at retail. In the short-term, both domestic and NZ volumes have been tighter and are not a present threat to Australia’s dominant position.
MLA activity – MLA’s summer grassfed beef campaign, ‘Eat Better. Feel Better.’, leverages the seasonal surge in demand for beef in the grilling season. MLA’s activities centre around positioning True Aussie Beef as a product that makes meal moments around the summer easy, taking advantage of key American past times such as cooking out and tailgating moving into the football season at the end of summer. It also promotes the health benefits of eating lean beef, with the target being fitness foodies.Our “Simply Spring” lamb campaign finished in Q2 of 2021 and extended the interest throughout the spring season to 'own' Mother's Day in May. The multi-channel digital approach centred on a new interactive “choose your own adventure-style” cooking video tool and a short Mother’s Day themed video series to drive stronger engagement and build loyalty for Australian lamb.

Japan

COVID-19 update – Japan continues to enact a state of emergency, which in recent weeks has expanded in length and geographical regions. The impact is predominantly affecting foodservice, as 8pm closures and restrictions on alcohol service restrain trade. We continue to see some venues defying the requests, however, general compliance has been high. Retail, delivery, and online sales continue to be stable-to-growing as consumers modify their consumption behaviours. Japan continues to escalate its vaccine rollouts as Tokyo held the Olympic Games without spectators and the Obon (summer) holidays saw sharp declines in domestic travel during what is traditionally a peak time.
Market access – Like many markets, supply and price continue to be the two main concerns. Recently missed sailings and container availability have also affected the market.
Sector analysis – Foodservice continues to struggle under the cloud of ongoing states of emergency, leading to uncertainty around stock control and conditions of operation. Restrictions have yet to ease, making it difficult for many to rebuild their businesses. Estimates of up to 1500 food and beverage venues have closed across Tokyo in the past 12 months, in particular those unable to pivot to meet modified demand and government requirements. Western style quick service restaurants continue to experience a boom in sales growth. Overall, total food sales were up 0.1% year-on-year to June, but 22.6% down on pre-pandemic levels. Yakiniku restaurants still trading have fared well, as Japanese consumers feel safer in a yakiniku restaurant with the increased ventilation that removes smoke from grills. Diversification to yakiniku and Genghis Kahn style restaurants by major foodservice chain restaurants continues in the market. Traditional retail remains robust in-market, with e-commerce developing across the country. Rakuten and Amazon continue to be dominant, however, are currently not reaching the level of sales volume seen in traditional retail. Lamb demand has been robust in all regions, with good coverage in both retail and foodservice outlets. Consumers are attracted to the nutritional benefits, while also looking to try something new beyond pork and chicken staples.
Competitor analysis – The US Meat Export Federation are currently running their social media focused summer campaign, scheduled to wrap up on 31 August. The UK's Agriculture and Horticulture Development Board (AHDB) will embark on a range of promotional and marketing activities for beef, pork and lamb from September. As a kick-off event, it will hold an online seminar for industry participants on 16 September and set up an online matching platform to pair with 10 UK companies.
MLA activities – MLA’s major consumer campaign ‘Let’s Barbie’ is in full swing in-market, leveraging the sponsorship and media opportunities from the Olympics. The summer campaign launch generated preliminary results of media coverage from 122 sources across the country, reaching 87.6 million people and generating $6.8 million in estimated media value. The new TVC promoting cooking thick-cut steak at home and a healthy active lifestyle ran throughout the Olympic period nationwide in one of MLA’s largest broadcast activities in recent years. - The offline activation Aussie Beef Clubhouse has so far attracted over 50,000 visitors, with consumers enjoying the experience of Aussie style barbeque. This is a 20% increase in customers from the previous year and due to its popularity will be extended until the end October, targeting an additional 25,000 consumer visits. MLA Japan was pleased to showcase the Aussie Beef Barbeque packs and True Aussie Beef summer campaign activities to the Minster for Trade, Tourism and Investment, The Hon Dan Tehan MP on his visit to Tokyo in July. - The annual Yakiniku business fair was held in Tokyo on 30 June, with MLA showcasing three different grades of beef and lamb to importers and end-users. The team achieved a 100% satisfaction rate from customers visiting the True Aussie Beef and Lamb booth. The upcoming annual Prince Hotel Australia Fair launches this week and will run through September and October in 12 hotels.

28 June 2021

Download a PDF of updates here.

China

COVID-19 update – The COVID-19 situation continues to be well controlled throughout the country despite a modest resurgence in the southern city of Guangzhou, where there are around 160 active cases. Lockdown measures are currently in place in the high-risk zones, with all restaurants and fresh markets in these areas closed. A nationwide vaccination program is being rolled out in a highly organised fashion at community level. The government expects to have 900 million injections completed by the end of July.
Market access – Market access remains challenging for Australian exporters, with plant suspensions unresolvable for the foreseeable future and a slow customs clearance process. MLA and DAWR employees posted in China will co-host a roundtable discussion in Shanghai with representatives from key exporters and importers this week to discuss the current situation and government responses.
Competitor analysis – China's demand for beef remains firm at a time of great complexity due to a container shortage that has raised the cost of freight up to US$350–400 per tonne, depending on the product. In the first four months of the year, exports to China from the top six countries shipped a combined 626,000 tonnes, about 120,000 tonnes more than for the same period in 2020. Exports from the main suppliers (Mercosur, Oceania and the United States) are estimated to have been 156,000 tonnes shipped in April, a drop of 24,000 tonnes on the previous month and in line with volumes shipped in April 2020. Brazilian beef exports to China remained slightly above 60,000 tonnes in April, about 7,000 tonnes less than in March. Operators reportedly handled sales of chuck and blade from Uruguay at US$5,100 cost, insurance and freight, knuckle at US$5,600, rib plate at US$4,100, and shin and shank at US$7,200. In the case of Brazil, exporters ask for US$6,000 for six-cut forequarters and between US$3,800–4,000 for beef trimming 80 VL. Sheepmeat business is also very firm. Agents handled sales from Uruguay of lamb carcases of 9–24kg at US$6,500 and six-cut mutton in a range of US$5,400–5,600 cost and freight.
MLA activity – The high note of recent MLA activities is without a doubt the SIAL trade show and networking function from 18–20 May. With international travel restrictions in place, MLA set up virtual meeting rooms and a virtual trade booth at the MLA stand for exporters to have a direct link with the visitors on the ground, as well as for exhibitors with customers who couldn’t travel to Shanghai. The MLA stand and the networking function drew an engaged crowd of customers despite a smaller audience than in previous years, ongoing political tension between the two governments and a gigantic US presence next to ours. This level of engagement is a result of our continuous trade-focused empowerment activities to boost confidence in the Australian red meat industry. During the past six months, MLA has rolled out five large-scale virtual and physical trade events, facilitating export-import matching, trade discussion on e-commerce opportunities, compliance training and advocating best practice and success stories in the market. Through our digital marketing platforms throughout 2020–21, MLA published 56 articles generating 305 million pageviews, 43 million digital views, and 1.5 million digital engagements. We conducted eight workshops for retail and foodservice customers which 150+ retail staff attended, and which had over 13,000 livestream views and over 14,000 engagements online. To strengthen display and merchandising standards in retail channels, we distributed over 346 premium space standard guides along with training workshops, 380,000 True Aussie labels and 101,625 point-of-sale materials in 48 retail channels. MLA staff visited 37 stores in seven cities.

Korea

COVID-19 update – Throughout May, COVID-19 cases remained high. The government has maintained level 2 social distancing restrictions for the Seoul Metropolitan Region and some cities until 4 July, at which time they will review this status. The government is planning to announce changes to social distancing restrictions in July – restaurant opening hours will be extend by two hours to 12am if the infection cases remain at this level. Even though cases are high, people are going out more and eating out in restaurants.
Market access – Shipping docking delays are still one of the main issues for trade, with limited shelf life for chilled beef and shortened supply for retail and the e-commerce market. Enhanced inspection of imported edible intestines came into effect as of 1 January 2021 in response to growing concerns of foreign matter. Within five months, export of intestines had decreased 70%, but since April export quantity has started to increase again. Large intestine trading volumes are still down, due to partially failed cases.
Sector analysis – Retailers and e-commerce retailers are still promoting Hanwoo and US beef short rib cuts, with sales up 20–50%. With people participating in outdoor activities, retail, e-commerce and delivery foods sales are down slightly, with foodservice sales increasing mainly on weekends.
Competitor analysis – US beef prices are still rising in the wholesale market and export prices are up more than 40% compared to a few months prior (when Australian beef prices were up). Due to the increase in US beef prices, there is interest in Australian beef commodity products as a replacement for processing products and in the foodservice market.
MLA activity – From April 19 to June 2, 2021, we have run a Kuk Cook Digital campaign that includes six major e-commerce channels (Coupang, SSG, Market Kurly, GS online, Lotte Online Mall and HomePlus online mall), working on promoting True Aussie. The digital campaign summary includes 104,271,585 total impressions and 19,434,962 total views. The e-commerce retailer promotion results will be coming out soon.
Market issue – In June, a strike by unionised delivery workers to improve working conditions is putting pressure on eBay Korea and 11STREET, both of which outsource their deliveries. On the other hand, e-commerce major retailers like Coupang and SSG.com that operate their own logistics centres or hire delivery drivers directly, have avoided being affected. Small- to mid-sized fresh food vendors have had difficulty with delays on their deliveries.

South-East Asia

COVID-19 update – The last two months saw a surge of COVID-19 cases in Thailand, Vietnam, Malaysia and Singapore, resulting in tighter movement and operational restrictions in retail, foodservice and hospitality. In some areas, there is growing acceptance that the virus is likely to be endemic. Governments are accelerating the roll-out of vaccines and implementing more schemes to support businesses so they can operate effectively under the ‘new normal’, and the safe re-opening of borders to facilitate economic recovery, such as Phuket’s planned reopening in July. Thai businesses are cautiously upbeat about the next six months as the government has set a goal to fully reopen in 120 days.
Market access and competitor analysis – Malaysian importers have not reported any issues with the new inner and outer labelling requirements, there is ongoing representations to work through listing of meat establishments. The beef trade in Vietnam and Thailand had started off strongly prior to COVID-19’s surge last month. There is a 20% year-to-date increase in manufacturing and higher-value beef exports into the Philippines, partly spurred by reduced restrictions and on the back of African Swine Fever. In April, live cattle trade into Indonesia and Vietnam was down by around 3% and 59%, respectively for the year-to-date due to subdued demand, price and competitors. Distributors noted Indian and Brazilian prices have risen in the past few months but are still retailing 15–20% cheaper than Australian or locally processed product.
Sector analysis – The foodservice sector, particularly high-end, full-service restaurants, remained moderately affected in several markets due to the very limited dine-in capacity. Most retailers are still reporting relatively stable sales compared to two months ago, including through online platforms. In line with changes in consumer shopping behaviour, some supermarket chains are revamping their offerings and store formats, such as opting for smaller store sizes (Giant in Malaysia), expanding ranges of convenient, healthy and gourmet foods and boosting online presence. Resellers are taking to social media and group community buys are gaining popularity.
MLA activity – MLA and 11 exporters took part in the Food & Hotel Asia Match Meat Series. The two-day event consisted of seminars, networking, and business-matching sessions as a precursor to the 2022 FHA trade show. From June to August, MLA is conducting the Great Steak Escape campaign in partnership with select restaurants, hotels and gourmet retailers. MLA has also launched the new Thailand ‘ambassador’ for Australian beef, Chef Pam, to promote awareness. The Lambassador chef series will be extended in Singapore and Malaysia from July onwards.

Indonesia

COVID-19 update – There has been a spike in numbers following the Eid al-Fitr holidays, with Greater Jakarta daily case numbers doubled compared to Q1. Indonesia’s government has extended the nationwide small-scale restriction measures but stopped short of imposing any additional controls. Domestic travel has increased, and household spending improved the past two months, but the upper-middle class are still holding back due to economic uncertainties.
Market access and competitor access – Businesses are concerned about the Indonesian government’s plans to impose 5–12% value-added tax for ‘premium’ key agriculture commodities including livestock and beef, particularly under current conditions where demand is already weak due to soft purchasing power. Work is ongoing to regain access for rendered products and listings of meat and registered establishments – the Ministry of Agriculture is revising regulations that would allow virtual audits to take place. All supplier countries would benefit from the revised policy, potentially allowing more establishments to be approved from Mexico and Brazil. In the June/July period, around 20,000 tonnes of Indian buffalo meat are expected to enter, depending on price and logistics.
Sector analysis – With Ramadan and Eid al-Fitr being the peak beef consumption period, modern retail did report good sales and growth compared to 2019, but less than 2020 (when sales benefitted from the panic buying spike). Indonesian lot feeders cleared their stock of around 40,000 head of cattle for the holidays. Current feedlot capacity after Eid al-Fitr is around 40%, with many yet to restock fully due to price and supply out of Australia, competition from cheaper frozen meat and soft demand. Hypermarket chain Giant will shut all stores by the end of July 2021 amid declining revenues. Giant has over 40 stores nationally catering to low-middle income consumers, offering mainly local beef and frozen buffalo meat.
MLA activity – In June, MLA conducted the month-long Jakarta Beef Up Festival and Great Steak Escape, partnering with 25 restaurants to highlight Australian beef on menus. As part of the True Aussie Beef & Lamb ‘always on’ social digital program, we also launched the YouTube channel, TrueAussieIndonesiaOfficial. Preparation is underway for the Indonesia Livestock Export Program Conference in November 2021.

MENA

COVID-19 update – COVID-19 continues to have a significant impact on life across the MENA region. New variants and relaxing restrictions following Ramadan have increased daily case numbers across MENA, though these numbers are now beginning to stabilise. Vaccine programs continue to play a strong role across the region, with 90% of the UAE’s targeted groups vaccinated (14.2 million people). Access to high throughput areas such as shopping centres, beaches and entertainment venues are now being restricted for those who cannot demonstrate they have been fully vaccinated.
Market access – The industry consultation period has concluded in Egypt for a proposed increase to chilled shelf life to 98 days for lamb and beef. Feedback is currently being reviewed by the Egyptian Organization for Standardization & Quality (EOS). If accepted, implementation of extended shelf-life would take place in two to four months, with a six-month transition period.
Sector analysis – The usual peak in lamb volumes during Ramadan did not eventuate in 2021 due to COVID-19-related restrictions in all markets, with both lamb and beef volumes similar to previous months. Retail has continued its strong, consistent performance in all categories due to a relatively wealthy population unable to travel internationally. Foodservice and hotel occupancy has been strong in the UAE because of continued international tourism, mainly from eastern Europe. In other markets, domestic tourism and entertainment continue to underpin hotel occupancy and premium grainfed beef demand in foodservice, particularly in Saudi Arabia, Qatar and Kuwait.
Competitor analysis: The increased cost of air freight has seen the Australian chilled lamb carcase market being substituted by product from other countries, particularly Romania and eastern Europe. Sentiment in the market is that there will be a switch back to Australian chilled lamb carcase if the freight cost can become competitive again.
MLA activity – Following the easing of restrictions in the UAE after Ramadan, the MLA MENA team has been able to begin physical activities, rebooting face-to-face importer training, foodservice immersions and trade promotion activities throughout June. True Aussie Beef & Lamb has partnered with the Victorian Government and local importer FoodSource for menu promotion across several Dubai venues throughout June. The menu has been curated by Chef Guy Grossi of Melbourne and highlights branded lamb and beef as the build-up for Expo2020 (now a year later) continues towards its October launch date.

Europe and the UK

Market access – A-EU FTA: The eleventh round of Australia-EU Free Trade Agreement (A-EU FTA) negotiations were held virtually in early June, with negotiating parties reporting a good and constructive atmosphere, along with a shared commitment to negotiate an ambitious and comprehensive agreement. Constructive negotiations continued in areas of good market access (however, the EU is yet to make any offer for Australian beef and sheepmeat), sanitary and phytosanitary measures and geographical indications. The twelfth round of negotiations has been tentatively scheduled for October 2021.
Market access – A-UK FTA: Prime Ministers Morrison and Johnson announced an agreement in principle regarding the parameters of the Australia-United Kingdom Free Trade Agreement on 15 June 2021. The agreement will see Australian beef and sheepmeat access to the UK liberalised over a 10-year transition period under the following phase-in:
- Increasing TRQ volumes on beef over 10 years, with access to a duty-free transitional quota of 35,000 tonnes on entry into force (EIF), rising in equal instalments to 110,000 tonnes in year 10. In the subsequent five years (years 11–15 after EIF) a product specific safeguard will be applied on beef imports exceeding a further volume threshold, rising in equal instalments to 170,000 tonnes, levying a safeguard duty of 20% for the rest of the calendar year. Out of quota tariffs will remain at MFN until year 10 and then be eliminated.
- Increasing TRQ volumes on sheepmeat over 10 years, with a duty-free transitional quota of 25,000 tonnes on EIF rising in equal instalments to 75,000 tonnes in year 10. In the subsequent five years (years 11–15 after entry into force) a product specific safeguard will be applied on sheepmeat imports exceeding a further volume threshold, rising in equal instalments to 125,000 tonnes, levying a safeguard duty of 20% for the rest of the calendar year. Out of quota tariffs will remain at MFN until year 10 and then be eliminated.
  
  The negotiating teams will continue work to finalise the legal text of the agreement in the coming months, with a view of formally signing the agreement later in the year, followed by formal ratification of the agreement.

Sector analysis – COVID-19 restrictions across the region are gradually being lifted, however, restrictions are being managed on a regional basis and travel is largely still restricted. Local tourism and the summer season are driving demand for outdoor dining and along with it a certain air of optimism. Moves are afoot to permit seasonal summer tourism, however, this will likely be highly regulated through rigorous testing procedures and/or vaccine passports.

North America

COVID-19 update – The US is showing a lot more optimism as vaccination rates exceed 50%, with 44% of the population fully vaccinated. Cases are down and most states are allowing restaurants to open at or near full capacity, as national guidelines relax and mask wearing declines significantly. The positive economic and consumer outlook continues as the jobless rate declines, in addition to some segments of the economy performing strongly despite challenges around COVID-19.
Market access – It continues to be a difficult year for Australian product into North America, with supply and price challenges. The strong Australian dollar and high Australian cattle prices in the first half of the year have driven manufacturing beef export volumes down by over 50% year-on-year, however, volumes have started to pick up in June. After a slow start to the year, the lamb trade has picked up and volumes in May are up for the year-to-date on previous years.
Sector analysis – The reopening of foodservice across the US is still patchy but the sentiment is positive and many restaurants that looked like closing during the pandemic were supported by government relief packages. Closure rates have been lower than expected at around 14% of restaurants that were open pre-pandemic, but independent operators suffered disproportionately. One of the biggest challenges now is attracting workers back into the industry. Retail continues to perform strongly in the US and consumer confidence in the kitchen has encouraged more premium product purchases, including of steak and lamb, to replace restaurant dining experiences, despite the foodservice sector reopening. The cook at home trend appears to be here to stay, at least in the short-term.
Competitor analysis – The big news for the market in May was the self-imposed export ban by Argentina for 30 days. While Argentina is not a large supplier to the US, volumes were expected to steadily increase to this market over time. China continues to dominate the trade flows from South American countries, with both Uruguay and Brazil not sending large volumes to the US. They are also somewhat blunted by restrictive quotas. NZ continues to face supply challenges on lamb, further affirming Australia’s dominant position in the US market.
MLA activity – MLA’s ‘Simply Spring’ campaign leveraged the seasonal sales spike of lamb, positioning True Aussie Lamb to extend the traditional Easter season and capture another special meal opportunity – Mother’s Day. This was through a series of educational tools promoting the ease of incorporating lamb into special occasion menu repertoires. Our spring campaign used mobile technologies to find and target category shoppers, drive them in store, raise Aussie lamb awareness and preference, as well as support supplier and retail partners. The ‘Eat Better Feel Better’ summer campaign positions True Aussie grassfed beef as a healthy, nutritious and sustainable option. To capture shopper attention during heightened seasonal focus on outdoor entertaining, as well as health and fitness, the campaign encourages consumers to swap at least one meal a week for Aussie grassfed beef.

Japan

COVID-19 update – The impact of COVID-19 is predominantly affecting foodservice, as 8pm closures and restrictions on alcohol service restrain trade. Some venues have defied the orders, however general compliance has been high. Retail, delivery, and online sales continue to be stable-to-growing as consumers modify their consumption behaviours. In recent weeks, vaccine rollouts have ramped up as Tokyo prepares to hold the Olympics in late July.
Market access – Like many markets, supply and price continue to be the two main concerns. The effect of the cyber-attack on JBS this month was also a source of unease in the market.
Sector analysis – Foodservice has struggled under the cloud of ongoing states of emergency, leading to uncertainty around stock control and conditions of operation. It is expected that post 20 June, restrictions will ease, allowing foodservice vendors to gradually rebuild their businesses. By contrast, Western style quick service restaurants continue to experience a boom in sales growth. Overall total food sales are down 3.4%, while meat sales are down 8%, compared to the same time last year. Yakiniku restaurants still trading have fared well as Japanese consumers feel safer in a yakiniku restaurants with the increased ventilation that removes smoke from grills. Major foodservice chain restaurants have therefore begun to diversify into popular lamb focused Genghis Khan restaurants in response to this behaviour. Retail continues to remain robust in-market, with e-commerce continuing to develop across the country. Rakuten and Amazon continue to be dominant. Lamb demand has been robust in all regions, with good coverage in both retail and foodservice outlets. Consumers are attracted to the nutritional benefits, while also looking to try something new beyond pork and chicken staples.
Competitor analysis – The US Meat Export Federation has commenced their summer campaign from 1 June to 31 August. Polish beef has entered the market next to Canada, Mexico and NZ.
MLA activities – MLA’s major consumer campaign ‘Let’s Barbie’ launches in June and will run until September. The campaign promotes cooking thick-cut steak at home and a healthy active lifestyle. This year’s theme builds on the strong emotional connection the consumer has with Aussie Beef and staying Genki – the Japanese word for vitality. The launch coincides with 30 years of Aussie beef trade liberalisation in the market. The campaign integrates traditional, digital and offline media channels built around a bespoke television commercial (TVC). Highlights include strategic nationwide TVC coverage during the Olympic period and a three-month offline Aussie Beef Clubhouse that brings the experience of Aussie style barbeque directly to the Japanese consumers. The campaign also targets retail customers through True Aussie steak sauce promotions in major retailers. MLA has upgraded its True Aussie Beef stickers, which link the customer to handy recipes, product information and promotions directly from the pack. The annual Yakiniku business fair will be held on 30 June, with MLA showcasing three different grades of beef and lamb to importers and end-users. Consumer-facing foodservice promotions have increased with activities in Ikinari steak, Daddy’s, Carl’s Jr and Family Garden.

27 April 2021

Download a PDF of updates here.

China

COVID-19 update – The situation is largely under control throughout the country, with daily new cases in single or low double digits and the majority of new cases from incoming visitors. Vaccinations are being quickly rolled out to all communities. There are very few restrictions on domestic travelling. All sectors are recovering from the pandemic to different degrees.
Market access – There is still no sign of relisting suspended plants in the foreseeable future, with no improvement to the geo-political relationship. Extensive quarantine and sanitation measures have been implemented at the ports, adding additional costs and time clearance processes and further limiting importer abilities to meet growing demand in China amid contracted supply from Australia. Demand for beef from Chinese importers remains firm, with prices stable. On the other hand, several operators expressed concern about the situation in Hong Kong. An agent indicated that for at least three months the grey channel has been at half speed, with low volumes of business compared to usual. As for sheepmeat, over-demand continues and deals from Uruguay include lamb carcases of 9–24 kg at US$5,600 CFR. According to one trader, values in other destinations such as the Middle East are 15% below China.
Competitor analysis – Brazil exported 56,411 tonnes shipped weight (swt) of fresh beef to China in February, the smallest volume since March last year. In any case, the start of 2021 came with much more robust sales to China. For the first two months of the year, Brazil exported 118,312 tonnes of beef, an increase of 30% compared to 2020. Meanwhile, the average export value in China was US$4,641/tonne, with a marked stability in the last four months but 19% below a year ago. The two major supplying regions of beef to China – Mercosur and Oceania – are estimated to have shipped about 140,000 tonnes to the market in February, slightly above the previous month, but about 60,000 tonnes below the peak of shipments last November. From Mercosur, shipments are estimated at around 110,000 tonnes (data from Argentina is not yet available), with a monthly decrease of 5,000 tonnes. . New Zealand sales increased by 6,000 tonnes to reach 19,355 tonnes, as did those from Australia by roughly 2,500 tonnes to reach 11,676 tonnes.
MLA activity – We recently held the Meat Australia China Awards event, featuring traders, restaurants, and retailers, as well as individual ambassadors that exhibit best practice in promoting Australian meat. We also delivered the first Compliance and Regulatory Seminar for importers in Shanghai, addressing common legal and regulatory issues in the importation process. A second seminar is scheduled on 27 April in Beijing. MLA will also participate in SIAL this year, after a break in 2020, starting May 18 in Shanghai.

Korea

COVID-19 update – Throughout April, COVID-19 cases have remained high, however, the government has maintained level 2 social distancing restrictions for the Seoul Metropolitan Region and some cities. There are limited restrictions on retail and foodservice outlets, with these remaining open until 10pm.
Market access – Shipping docking delays are still one of the main issues for trade, with limited shelf life for chilled beef and shortened supply for retail and the e-commerce market. Enhanced inspection of imported edible intestines came into effect as of 1 January 2021 in response to growing concerns of foreign matter. After three months of inspections, there has been a reinvigoration of interest for edible intestines, with product passing the enhanced inspection process.
Sector analysis – Retailers are promoting US beef and Hanwoo, with sales up to 50% and 30%, respectively.. Foodservice is recovering, but still limiting people shopping at night. Recovery has reached around 80% of pre-COVID-19 levels. Major retailer E-mart have started a price compensation campaign if their prices are higher than competitor retailers, including for e-commerce market Coupang.
Competitor analysis – US beef prices have been increasing recently, but their contracted products are still being imported at a higher quantity. From April, US tenderloin has been imported in a similar quantity to Australia’s. Australian product is growing in sales through developed markets, such as retail and e-commerce.
MLA activity – From 19 April for six weeks, we are having a Kuk Cook Digital campaign that includes six major e-commerce channels (Coupang, SSG, Market Kurly, GS online, Lotte Online Mall, and HomePlus online mall) working on promoting True Aussie. Those e-commerce channels now hold more than 20–25% of imported Australian chilled beef. From 12 April, E-mart traders are holding a three-week Hojuchungjungwoo (TAB) Thanking festival, with the key products for the festival being 100-day grainfed Wagyu and marinated beef (thin, thick skirt, bulgogi).

South-East Asia

COVID-19 update – Several countries and territories in South-East Asia (SEA) have continued to report COVID-19 transmissions in recent months. Recovery in individual countries will remain weak and incomplete if the domestic spread of the virus is not controlled.For instance, the latest International Monetary Fund forecasts suggest that income per capita in the ASEAN-5 economies (Indonesia, Malaysia, the Philippines, Thailand and Vietnam) will still be 6% lower in 2024 than the level that was expected before the pandemic struck.
Market access – Global trade has held up surprisingly well, as SEA is a heavily trade-driven region. Market access to beef and lamb have been stable, however, there have been some technical trade issues with halal labelling changes in Malaysia and issues travelling for halal audits and approvals. On 6 April 2021, 60 importers, wholesalers and retailers from Malaysia participated in the MLA Virtual Trade Forum in response to importers’ feedback and queries on the new labelling requirement. MLA is working with the Australian Government to ensure they have the appropriate information to inform Malaysian Department of Veterinary Services regarding Australia’s inability to comply with ‘imported by’ label requirements.
Sector analysis – SEA tourism and foodservice sectors have been heavily affected by the COVID-19 outbreak. With uncertainty around COVID-19 still high, domestic consumption is expected to be the key for SEA to overcome ongoing challenges until international travel resumes. A local customer-centric approach within foodservice and retail is essential to growing Australian beef and lamb in SEA as COVID-19 continues to unfold globally. Despite the pandemic, Singapore, Indonesia, Vietnam, and others are seeing an increase in the number of gourmet grocer outlets across major cities that target emerging affluent local and expatriate consumers. This trend creates further opportunities to grow premium beef products.
Competitor analysis – SEA is also seeing a robust increase in the presence of US beef. US beef imports have grown at 25% a year on average over the past three years. Strong growth is occurring across all US export markets in SEA. The US is spending more on marketing and promotion and becoming a strong competitor to watch in the market.
MLA activity – The True Aussie brand will be focusing on physical availability over the coming three months to help drive sales in foodservice. With the price of beef and lamb on the increase, True Aussie must commit to a premiumisation strategy driving desirability for Australian beef through a 360-marketing campaign that celebrates its product range variety. In June, True Aussie will be continuing the ‘Beef Up’ campaign, focusing on provenance and quality. It will also communicate to consumers the message that ‘we are sad our neighbours can’t visit us in Australia and see our natural treasures, but we can still share the best of our produce with SEA consumers to taste our Natural Australian Goodness’.

Indonesia

COVID-19 update – The COVID-19 vaccination program is well underway, with an estimated 500,000 people being vaccinated daily. Daily official case numbers still averaged 6,000 in Q1. Most provinces are still implementing localised COVID-19 measures, restricting operational capacity to 50%.
Market access – Q1 2021 trade volume was slightly down, partly due to concerns about the influx of cheaper frozen meat imports from India and Brazil. Chilled beef imports tracked higher, however, reflecting a growing appetite for quality beef. The Indonesian government (Ministry of Agriculture) is finalising changes to import conditions for live cattle, easing the breeder-feeder import requirements to 3% based on pen capacity and reducing days-on-feed to 90 days. The ministry is considering temporarily easing conditions for establishment approvals to secure more consistent red meat supply during the pandemic.
Sector analysis – The Indonesian government is projecting a 4.8–5.3% GDP growth for 2021, slightly above what is being forecasted by the IMF (4.3%). With the vaccination program underway, consumer confidence has rebounded, but hospitality and foodservice businesses have yet to see significant uptick in sales in Q1. Supermarkets and hypermarkets did report a rise in Ramadan and Eid al-Fitr sales, in line with this being the peak consumption period. A few supermarket chains are expanding, and it is anticipated that high-end modern retail would remain the dominant showcase for Australian products, even as consumers are increasingly flexi-shopping between fresh and wet markets, modern trade and online.
Competitor analysis – Indonesia is still actively diversifying supply from non-traditional countries including Europe and South America. Cheaper frozen meat from Brazil and India continue to gain ground in the price-sensitive commodity channels, with traders recently estimating up to 30% displacement. Australian beef still has strong penetration in the modern trade (mid- and high-end foodservice and retail) and continue to be regarded as safe, of consistent quality standards and premium. It would be important for Australia to maintain its premium positioning, rather than competing in the commodity space as competition intensifies – this is done by increasing our brand presence and power through True Aussie Beef and Lamb activities, broadening our collaboration with nine supermarket chains including Aeon, Ranch & Farmers Market, Hero (Dairy Farmers), Foodhall and LotteMart.
MLA activity - In Indonesia and SEA, True Aussie activities are focused on physical availability, with targeted campaigns in foodservice and retail. Following on from the Ramadan campaign, in June there will be a month-long foodservice festival with up to 30 restaurants in Jakarta, in line with the SEA Beef Up campaign.

MENA

COVID-19 update – COVID-19 continues to have a significant impact on life across the MENA region. Some countries are seeing a significant increase in daily positive case numbers, with closed borders and short-term lockdowns continuing to be implemented when required. Large-scale vaccination programs across MENA continue to be rolled out, with the UAE taking the lead in the region with over 9.6 million vaccinations to date. The pandemic will impact pilgrims in Saudi Arabia – pilgrims and worshippers who have been vaccinated against COVID-19 or have recovered from coronavirus will be allowed into the Grand Mosque in Mecca.
Market access - Shelf-life changes have recently been announced in Saudi Arabia and Oman, which increase the shelf life of chilled vacuum packaged beef and sheepmeat from 70 days to 120 days and 90 days, respectively. This achievement has an estimated overall industry benefit in excess of $A50 million pa. Work is ongoing in Egypt to pursue shelf-life extensions for chilled vacuum packaged product. A successful shelf-life trial in Cairo managed by MLA and the Animal Health Research Institute (AHRI) concluded that chilled vacuum packaged beef was suitable to consume up until 126 days.

Sector analysis – The retail sector remains strong among all MENA markets, with the online sector seeing significant growth, although from a very small base of 2.4% within the region. With a relatively wealthy population unable to travel internationally, domestic tourism and entertainment remains strong. This has seen the premium grainfed beef category increase 28% in shipped volume, with growth mainly occurring in the Kingdom of Saudi Arabia (KSA) and the UAE. Dubai has remained open to international tourism, which has kept the hotel occupancy and the foodservice sector relatively stable. It has now launched a Dubai Digital Nomad Visa campaign to actively encourage people to work remotely from Dubai.
Competitor analysis: A large Russian beef company had a significant presence at Gulfood, presenting a beef product that is now very competitive with Australian grainfed MB3-4. They have made inroads into the premium KSA retail market and are looking to expand across the region.
MLA activity – The major focus is the current Ramadan campaign, positioning Australian beef and lamb as a premium ingredient suitable for traditional Arabic dishes, and not just western dishes. This messaging will be important to continue to maintain or grow market share, especially for Australian lamb as demand grows in other markets. Dubai’s Expo 2020 is still planned to launch in October 2021 and will likely be one of the only global events to be held this year. While visitor numbers are expected to be much lower than forecast, it will still provide a fantastic opportunity to showcase premium Australian lamb and beef on the global stage throughout the six-month event.

Europe and the UK

COVID-19 update – COVID-19 remains a live issue across the EU and UK, with varied responses across the market, including significant lockdown measures. Lockdown restrictions are easing in the UK, with non-essential shops and outdoor hospitality reopening on 12 April 2021 and a roadmap to greater freedom throughout May and June. Across Europe, several countries have recently resumed tighter restrictions, including France, Germany, Italy and the Netherlands. The implementation of the vaccine roll-out remains a priority and there are plans for easing of restrictions throughout the spring and early summer.
Market access – The tenth round of Australia-EU Free Trade Agreement (A-EU FTA) negotiations were held virtually in early March, with negotiating parties reporting substantive progress made across a range of issues. Constructive discussions on goods market access, including agricultural market access, were held, however, the EU is yet to make any offer for Australian beef and sheepmeat. The eleventh round of negotiations are scheduled for June 2021. The fourth round of Australia-UK Free Trade Agreement (A-UK FTA) negotiations were held virtually at the end of February and early March, with negotiators reporting that good progress was made across the agreement. While there is yet to be an offer on Australian beef and sheepmeat, the negotiating teams indicated that good progress was made on the text of the Trade in Goods chapter. The fifth round of negotiations is scheduled to take place at the end of April.
Sector analysis – As a result of numerous restrictions across the region, the hospitality and foodservice sectors have been constrained for the first quarter of 2021, with the retail sector continuing to perform. However, in the UK particularly, the relaxation of restrictions and potential for local travel and tourism, along with the return of outdoor dining have brought a certain air of optimism. There is ambition across the EU for tourism to be permitted in some format over the summer months, however, this will likely be highly regulated through rigorous testing procedures and/or vaccine passports.

North America

COVID-19 update – The US is showing a lot more optimism as vaccination rates move quickly. However, COVID-19 case numbers are still at unacceptable levels and public health authorities are urging caution about easing restrictions too early. Some states are allowing restaurants to open at or near full capacity, while others continue to follow national guidelines. The reopening of foodservice across the USA is at best, patchy.
Market access – In general, it has been a difficult year for Aussie product into North America with supply and price challenges. The strong Australian dollar and high Australian cattle prices in the first quarter have driven manufacturing beef export volumes down by over 50% year-on-year. Lamb trade has slowed but is more in line with previous years.
Sector analysis – Foodservice continues to be challenged by COVID-19 restrictions and lingering consumer reservations to return to eating out. However, there is a sense that relief is in sight as summer approaches. The surge in ghost kitchens, new delivery and contactless purchasing are hallmarks of pandemic survival, but these innovations are likely here to stay. Retail continues to perform strongly in the US, and newfound consumer confidence in the kitchen has encouraged more premium product purchases, including of steak and lamb, to replace restaurant dining experiences. The positive economic and consumer outlook has been greatly assisted by government support packages, in addition to some segments of the economy performing strongly despite challenges around COVID-19.
Competitor analysis – Australia’s position as the premium offer has come under some competition from Central and South American countries, although, the focus by Brazil, Argentina and Uruguay on China has blunted their penetration into the US. NZ has also faced supply challenges, particularly on lamb.
MLA activity – MLA’s winter “Make a Moment” campaign leveraged the seasonal sales spike of lamb and grassfed beef, positioning True Aussie Beef and Lamb as a resource for elevating meal moments during the holiday season and promoting the ease of incorporating these into special occasion menu repertoires. The multi-channel digital approach centred on a season of virtual events, culminating in an attempt to host the world's largest virtual dinner party on Australia Day, 2021. Spring is the key season for lamb in the US, but finding Aussie lamb at retail is complicated. Our spring campaign uses mobile technologies to find and target category shoppers, drive them in store, raise Aussie lamb awareness and preference, as well as support supplier and retail partners.

Japan

COVID-19 update – COVID continues to impact Japan as the country moves into a suspected fourth wave. Foodservice in particular remains impacted by early closures at 8pm in a quasi-state of emergency. Discussions continue within the government as to the likely length of these restrictions while the vaccine roll-out moves along at a comparatively slow pace. Retail, delivery and online sales, however, continue to be stable-to-growing as consumers modify their consumption behaviours. The upcoming Golden Week, starting late April through early May, is traditionally a busy time for travel, events and gatherings, however, movements are expected to be subdued as many err on the side of caution.
Market access – Safeguards on US beef ended on April 16 after activating in March. The safeguard triggered at a time when market prices were rising on the back of a decrease in the supply of Aussie beef. Reported shipping delays also affected market sentiment for imported beef, impacting most major exporters to Japan.
Sector analysis – Over the last 12 months, retail has remained resilient, however, the increasing costs of raw materials recently have retailers concerned. In market, they are hesitant to raise prices for the end user considering a lack of recent wage growth. The performance of domestic Wagyu in-market is rising on the back of government subsidies in 2020. The effect has been compounded by rising prices of imported meats in recent months. Demand has been increasing for yakiniuku meat in retail in line with the early closure of restaurants.
Competitor analysis – Competition remains robust in the market, with continued interest from producers from the US. Interest (albeit of a lower volume) is also increasing from several UK and European exporters.
MLA activities – MLA will conduct its major Summer Consumer Campaign from May through to September this year. The ‘Let's Barbie’ campaign aims to build awareness, preference and intent to purchase through targeted, integrated marketing activities. The campaign will leverage both the opportunity of the Olympics as well as the 30th anniversary of the liberalisation of beef in the market. As the e-commerce environment rapidly evolves, MLA is conducting partnership-marketing activity with both Amazon Fresh and Rakuten Ichiba, the two market leaders. Foodservice promotions are a focus over summer, with several major restaurant chains across the country conducting True Aussie Beef activities. The 2020 Yakiniku Exhibition is expected to proceed in Tokyo and Osaka in June/July, with MLA participation. MLA is also holding a major online and offline lamb campaign called the Lambassador Festival over the coming months.

For more information, find contact details of MLA’s international offices here.

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How MLA help promoting australian beef & lamb

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More to explore

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International market updates

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