Why?
OPINION: A mate of yours truly wants to know why the beef schedule differential is now more than 45-50 cents a kilo between North and South Island producers – if you look at February 2024 steer prices.
Speaking at last week’s annual BLNZ and Massey University science day at Feilding, Champion said tough financial times in the US have prompted some people to ‘trade down’ their eating habits. Instead of ordering their customary steak at their favourite restaurant, they often opt for ‘mid market’ or fast food in which New Zealand lean beef is used extensively.
“Many people, me included, often think ground beef is a lower value product and – in a dollar value sense – it is, compared with high-end table cuts. However, New Zealand lean ground beef is sought after to produce the perfect hamburger,” Champion explained.
“They take lean beef from New Zealand or Australia and blend it with a fattier American feedlot beef to produce the perfect hamburger patty. So we are an essential part of that international supply chain, because not only are we supplying it to the US, but to Asia as well.”
In overall beef sales to Asia, Champion says it’s a bit of a mixture. For example, Taiwan takes a reasonable amount of processing beef. However, each market is different and he notes China is taking more ground beef as the fast food market there develops.
Champion believes with the growth of the wealthier, middle class in China, demand will increase for the high-end cuts.
“There is a growth for western food services in China, especially from the larger international hotel chains. The idea that the west is eating more eastern food, and vice versa, is a reality.
“My eating style has changed compared to when I was kid. I eat a lot more Asian food; at the same time as we are seeing the presentation of more western food in Asia as well.”
Champion says beef has a lot going for it as a protein because globally it’s a product that’s ‘well understood’.
“Beef might be used in ground forms, cuts, styles or whatever. But it is pretty well understood – compared with sheepmeat where there is a whole consumer education process required in new markets about what you do with sheep.
“Beef, on the other hand, is comparatively well understood. But one challenge facing beef is that whatever production system we use, it is more expensive to produce than the more intensive meats such as chicken and pork.”
He says with the expansion of the dairy industry more beef is now available and it’s a case of maximizing the returns on that meat.
