Japan Easing Decade-Long Ban on American Beef Imports

Jan 30, 2013 07:04 PM EST

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Cattle rancher Gary Price watches his herd as they seek shade in 103 degree heat on his ranch in Blooming Grove, Texas
(Photo : Reuters Staff)

A ban on U.S. beef imports in place since "mad cow disease" outbreaks in 2003 has been eased by the Japanese Ministry of Agriculture, Forestry and Fisheries. The change will take effect on Monday, January 28.

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The move was a further relief from 2006 rules that mandated only cows 20 months and younger could be imported, a step back from a full ban in 2003. Japan will now allow U.S. cows 30 months and younger to be brought into Japan.

The National Cattlemen's Beef Association released a statement saying that the change "will result in hundreds of millions of dollars in additional exports of U.S. beef."

"This is great news for cattlemen and women and is a significant milestone in our trading relationship with Japan," said NCBA President J.D. Alexander. "Japan is a great market for U.S. beef and we look forward to continuing to meet Japanese consumer demands. This move is an important step forward in paving the way toward greater export opportunities to one of our largest export markets."

Japan is an important market for U.S. beef exports, accounting for nearly $849 million and 130,000 metric tons in 2012, making it the second largest export market for U.S. beef.

Mad Cow Disease

Bovine spongiform encephalopathy (BSE), better known as "mad cow disease," infects cattle and causes them to show behavioral and neurological aberrations. Infected cows' brains appear to have holes when examined microscopically. The infectious agent of the disease can spread to humans through eating meat from an infected animal, and manifests as Creutzfeldt-Jakob disease.

The discovery of mad cow disease in American cows in December 2003 resulted in massive import bans against American beef from approximately two dozen nations, although many rescinded or eased those bans in the ensuing years. Japan has taken a more cautious stance, and the latest development represents a big opportunity for the U.S. cattle industry.

Lasting ffects of the Japanese import ban are apparent in comparisons between 2003 and 2012 statistics. According to the U.S. Department of Agriculture, in 2003 ranchers exported 375,455 metric tons of beef to Japan, worth $1.391 billion. In 2012, that figure dropped to 158,646 metric tons, worth $874 million.

Challenges Ahead

The cattle industry still faces increasing pressure from rising grain prices. A drought, coupled with competition from ethanol, has greatly increased the cost of feed and raised operating costs for cattle ranchers.

Ana Puchi-Donnelly, an agricultural commodities trader in London, deemed this year the "worst drought in the last 50 to 70 years in one of the hottest years on record."

Although it remains to be seen whether cattle production can meet the new demand from Japan, the cattle industry is pleased nonetheless.

"This announcement is a shot in the arm to a market and producers facing continued drought, high input costs and increasing federal regulation," said Alexander.



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