Chinese Hot-Pots Stir Imports of Beef, Mutton: Chart of the DayBloomberg News
Chinese eat almost 50 percent more pork than Americans. Now they’re adding more beef and mutton to their diets, driving up prices and spurring record imports.
The CHART OF THE DAY compares average retail prices in China of beef, mutton and pork since 2011. Beef has risen 65 percent and mutton 40 percent compared with a 17 percent drop for pork belly, which at 25.36 yuan ($4.13) per kilogram is now about two-thirds cheaper than the alternatives, National Bureau of Statistics data show. The lower panel shows annual imports of beef and mutton, according to data from Rabobank International, which the bank forecasts will both rise by more than 30 percent this year.
“Consumers perceive mutton and beef as healthier while rising incomes afford more dining out, boosting sales of items like mutton boiled in hot-pot,” said Pan Chenjun, Hong Kong-based analyst at Rabobank. “China can’t produce enough to meet its demand, while its pork production is plenty.”
Food safety is a major concern across China. U.S. beef imports have been banned since a mad-cow incident in 2003. Pork production was rocked after thousands of dead pigs were found in a Shanghai river in 2013. This year, Yum! Brands Inc., which gets about half its revenue from the China, terminated its relationship with supplier OSI Group LLC after a probe into the changing of sell-by dates. Yum, owner of KFC and Pizza Hut, paid about $580 million in 2012 for control of Chinese hot-pot restaurant Little Sheep Group Ltd.
China’s beef consumption could rise by more than 70 percent from 2013 to 2030, Australia & New Zealand Banking Group Ltd. said Sept. 5. The proportion of beef imports, now about 19 percent domestic demand, will double in less than two decades, ANZ said. Australia and New Zealand are leading beef and mutton suppliers to the world’s most-populous nation.
“China will have structural shortages of mutton and beef, and hence elevated prices for years to come,” Rabobank’s Pan said. Producing the same amount of beef as pork in China uses about three times the amount of grain, which costs double the price on Chicago Board of Trade, the global benchmark, she said. Per-capita consumption of beef in China was about a tenth that of pork in 2013, Bloomberg Intelligence data show.
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