A 15-year effort to develop the Chinese market is now paying dividends, with beef sales to the Asian powerhouse driving a sharp increase in cattle slaughter
It takes time, but sustained and focused marketing is worth the effort, according to a senior official with Australia’s beef-marketing agency.
“We were in China 15 years ago, just trying to get the brand Australia established — it’s only been in the last 12 months that we’ve really started to see the benefit of that,” Tim McRae of Meat and Livestock Australia said at the recent Canfax Cattle Market Forum.
In fact, exports of chilled cuts, briskets, and high-value cuts have soared from $150 million to $600 million over the past six months, said McRae, manager of market information and analysis for the producer-owned organization, which devotes most of its market development dollars to Asia and Southeast Asia.
“We have an additional 600,000 to 700,000 head of cattle slaughtered this year, and most of that product has been consumed in China,” said McRae. “Our exports have gone from about 16,000 tonnes in 2010 to 160,000 tonnes now.”
Australia exports about a million head of live cattle and water buffalo annually into Indonesia and Southeast Asia, but countries such as Japan and China are primarily after high-value cuts.
But his organization has been very selective in its marketing efforts, McRae said.
Rather than promoting Australian beef in China’s largest cities, it has focused on second-tier cities.
“We just don’t have the product that would be ready to go if all of a sudden they gave the go-ahead and said, ‘Send us all of what you’ve got.’”
And rather than targeting consumers directly, it targets chefs through food demonstrations and competitions.
“It’s about penetrating the Chinese cuisine,” said McRae. “We’re not trying to teach them how to eat it differently. We’re trying to adapt our product to fit their cuisine.”
His organization also closely tracks changes in buying patterns.
“We’re selling products to what the consumer and what the buyers in these markets want,” he said. “We will tailor our product to that market.”
In the past, Australia promoted its pasture-finished beef in markets such as the EU and the U.S., but that’s changed.
“We’ve built a lot of our exports on that model of grass-fed beef, but we’re also more and more becoming a cut-oriented business,” said McRae. “We don’t do beef anymore. We do cuts of beef.”
Another key has been an overhaul of its grading program. The country now uses the Meat Standards Australia grading program, which allows consumers to purchase beef based on the specific quality and cooking purpose of the product.
“The design of this is to remove the guesswork for Australian consumers on purchasing a piece of meat,” said McRae. “Now they know they can go out and buy a piece of beef, and it will meet their expectations. There’s nothing worse than getting a piece of meat and eating it, and it didn’t live up to expectations.”
More than 30,000 Australian producers are now accredited to produce beef for the program.
“To meet the requirements is actually not that hard for Australian producers in a good season,” said McRae. “Pretty standard production practices will get you accredited and in the system.”
The program, launched almost a decade ago, has only gained traction in the last two or three years, when two of Australia’s major retailers — Woolworths and Coles — adopted it. Woolworths, Australia’s largest retailer, now accounts for 32 per cent of all beef sales with a Meat Standards Australia sticker on it.
It’s been such a hit at home, the beef sector is now looking at using the same system for exports, he said.
“We really are doing anything we can do to make sure our export markets not only stay open to Australian product, but are more likely to buy it.”