Welcome to the MEAT Traders’ Journal

Your essential guide for the latest in pork, beef, chicken, and more.

I wonder what is happening in China Hog and Pork Market…

A recent discussion with an expert familiar with China for over 34 years revealed uncertainties surrounding African swine fever's impact on China's hog herd. Despite China's vastness complicating the full grasp of ASF's status, the resilience in overcoming this disease cannot be ignored.

A downturn in pork consumption links to the struggling Chinese economy, with a significant shift in consumer investment behaviors from real estate to beef consumption. Notably, beef, particularly grain-fed, heavily marbled varieties, sees rising demand among China's affluent, outpacing domestic production and leading to increased imports.

November's hog slaughter data indicated a surge over 40% higher than the previous year, suggesting panic liquidation due to disease spread and significant sow culling. This reflects the overarching uncertainty in China's pork sector.

In the U.S., the pork market faces challenges with bearish trends despite a mere 1% decrease in the hog herd compared to a 9% decrease in the cattle herd over four years. The culling rate compared to the increase in pigs means production continue to rise, leading herd efficiency through the elimination of older, less productive breeding stock.

The uncertainty extends to whether a significant cull will occur in 2024, mirroring uncertainties in the U.S. hog market. The EU sees reduced production and high prices, with the U.S. gaining a larger share of global pork exports despite production outstripping demand, indicating a bearish market and the catalyst to change this situation might even come from China.

From this we can conclude…

Navigating this complexities requires an understanding of the interplay between domestic production, global demand, and economic factors of the country in question. The situation in China, coupled with global market dynamics, underscores the need for strategic vigilance in the pork industry's future.

_{Article insights derived from Dennis Smith's analysis on the pork situation in China.}

From Fast Food to Future-Friendly Mc Donald’s Quest for Sustainable Beef!

In 2014, McDonald's embarked on an ambitious journey to source "verifiable, sustainable beef" to address its environmental impact, despite not having a clear definition or timeline for achieving 100% sustainable beef across its global operations. A decade into its quest, McDonald's, aiming for net-zero carbon by 2050, has made strides but still faces significant challenges. The company's initiative highlights the complexities of transforming global supply chains and the broader beef industry towards sustainability.

Despite McDonald's relatively small share of global beef consumption, it has spearheaded efforts to engage with suppliers, ranchers, and international stakeholders to promote more sustainable practices. This includes the Global Roundtable for Sustainable Beef and pilot projects in countries like Canada, focusing on principles such as regenerative agriculture to reduce emissions and improve environmental outcomes. However, Mc Donald’s acknowledges the ongoing struggle with defining and measuring sustainability, shifting its language from "sustainable beef" to "beef sustainability" to reflect the ongoing nature of this challenge.

The quest for sustainable beef involves tackling water usage, soil erosion, and greenhouse gas emissions associated with cattle farming. McDonald's efforts extend to ensuring deforestation-free supply chains and promoting water and soil conservation practices. Yet, the scalability of these initiatives and their ability to significantly offset the environmental impacts of beef production remain uncertain.

McDonald's journey underscores the broader question of whether the current levels of beef consumption and production can ever be truly sustainable. Despite advancements in sustainable farming practices and industry collaboration, the increasing global demand for beef poses a significant hurdle. As McDonald's continues to expand its operations, the challenge of aligning growth with environmental goals becomes even more pronounced.

This exploration of McDonald's decade-long effort to promote beef sustainability reveals both the progress made and the daunting challenges ahead. We can foresee several outcomes and trends emerging from this quest for sustainable beef:

• McDonald’s could inspire a industry-wide movement towards environmental stewardship driving innovation and setting new benchmarks for responsible sourcing.

• This quest could also stimulate a growing consumer demand for sustainable produced food, potential influencing regulatory policies and fostering a competitive advantage for companies that prioritize green practices.

However, the challenges in defining, measuring and scaling sustainable beef highlight the complexity of reducing the environmental impact of beef production. Therefore, we are witnessing a shift in the beef industry towards more sustainable practices or alternative proteins. For example, introduction of new vegetarian and plant-based menu options, such as the McVegan burger in Finland (introduced to the menu back at the end of 2017) and the McPlant (back in 2021) in a partnership with Beyond Meat.

McDonald's continues to explore opportunities to further reduce its environmental footprint, demonstrating a willingness to adapt and innovate within the context of global sustainability concerns.

This information is based on an article published by the GreenBiz in 2024. Link.

The 9 Most Common Mistakes Importers Make when Choosing Suppliers

1. Undercapitalization: starting an importing business or continuing importing after economic difficulties without adequate assessed capital can lead to financial difficulties and so much distress for importer and supplier.

2. Poor business planning and product selection: focusing solely on trends or low prices instead of considering the overall market demand and compatibility with existing product lines and competitors.

3. Failure to properly classify goods and research possible import barriers: Lack of knowledge about tariffs, quotas and other regulatory requirements can results in unexpected expenses and delays. Get a good consultant who can guide you and connect you with good tax and custom brokers.

4. Failure to figure in all costs of importing: usually the misunderstanding of incoterms and failing to factor in additional costs beyond purchase price. That could be exchange rates variations, extras in warehouses, delays in transportation and more.

5. Failure to adequately choose a team: hiring competent professionals, such custom brokers, accountant and sourcing/buyers strategists that can negotiate are some of them that are overlooked.

6. Choosing the wrong supplier: chose supplier based on price or without proper diligence. Ask competitors, distributors and hear the market. That would save you more than one headache.

7. Unrealistic expectations: assuming suppliers or forwarders or shipping lines will meet deadlines could be an oversight. You need to set a buffer to consider delays or before time arrivals.

8. Not monitoring orders: You can’t expect supplier will do everything. You need to track the container and request the documentation on time for your own revision to secure that everything in your side is properly monitored. In case of issues then they can be addressed promptly.

9. Forgetting Holidays in different markets: not considering the holidays and its impact in production can be an oversight for you and affect your fulfillment planning and container schedule arrivals. Those affect production schedules and prices more than you think.

To minimize these risks, building lasting partnerships with reliable suppliers who can consistently deliver high-quality products at reasonable prices.

Did you know…?🔍

Pork was branded as “The Other White Meat” in the 1980s to position pork as a healthy alternative to chicken?

The "Pork. The Other White Meat" campaign, launched in 1987, was a significant rebranding effort by the pork industry to position pork as a healthy alternative to chicken.

The campaign was a response to the declining demand for pork, largely due to health concerns associated with red meat. The slogan "The Other White Meat" was not only a marketing strategy but also marked a transformation in American farming, as it reflected the changes in pork production methods, resulting in leaner meat.

The campaign was successful in terms of recognition, with eight out of ten Americans recognizing the phrase. However, despite the initial boost in sales, per capita pork consumption remained relatively stable, while chicken consumption continued to rise. 

The campaign's impact on the meat industry was significant, as it aimed to change consumer perceptions and increase demand for pork as a white meat alternative.

The campaign's impact on the meat industry can be summarized as follows:

• Repositioning Pork: The campaign aimed to reposition pork as a healthy alternative to chicken, responding to the declining demand for pork due to health concerns associated with red meat.

• -Transformation in Farming: The slogan "The Other White Meat" marked a transformation in American farming, reflecting changes in pork production methods that resulted in leaner meat.

• Recognition and Consumption: The campaign was successful in terms of recognition, with eight out of ten Americans recognizing the phrase. However, despite the initial boost in sales, per capita pork consumption remained relatively stable, while chicken consumption continued to rise.

• Ongoing Adaptation: The subsequent re-evaluation of the campaign and its rebranding in 2005 reflect the ongoing efforts of the pork industry to adapt to changing consumer tastes and preferences.

The "Pork. The Other White Meat" campaign successfully altered consumer perceptions of pork, making it appear as a healthier and more desirable option. However, it did not translate directly into a surge in pork consumption. Instead the campaign contributed already in the 80s to the growth of the pork industry through increase exports, higher retail values and changes in the farming systems.

Have a look at the Ad of “Pork. The Other White Meat” Campaign released in 1988.

One last thing…

If you are aiming to strengthen your business foothold in the APAC Market in this areas:

• Market Expansion and helping with client Acquisition

• New Market Fit with product/specification development

• Sales Growth and Price Optimization with Market Intel

• Sales Training and objection ideation to gain new clients

There are 3 ways that Meat Trading Hub (MTH) can help you:

✅Market Advisory 1:1

✅Collaborative Partnership

✅On-line and off-line Training sessions to elevate export/sales team

Schedule a discovery call and let’s explore opportunities together!

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