News Update

News Update
Feb. 3, 2006

U.S., South Korea to Begin FTA Talks

President Bush has announced that South Korea — historically one of the largest importers of U.S. beef — and the United States intend to negotiate a bilateral free trade agreement (FTA).

That’s good news for agriculture, Secretary of Agriculture Mike Johanns stated yesterday.

“Korea is the world’s 10th-largest economy and already our sixth-largest market for agricultural exports, with a very real potential for greatly expanded sales of U.S. farm and food products,” he stated in a release. “A free trade agreement will greatly improve access for our producers to Korean consumers that seek high quality and affordably priced U.S. products.”

Industry groups like the National Cattlemen’s Beef Association (NCBA) are encouraged by the news.

NCBA President Jim McAdams said, “We support the launch of this free trade agreement with South Korea, and expect to see the full reopening of this market to all U.S. beef, significant reductions of Korea’s tariffs, and resolution of important sanitary and phytosanitary (SPS) issues.”

Michelle Reinke, NCBA director of legislative affairs, added that the FTA must assure all tariffs on U.S. beef be reduced to zero. “Right now, along with the partial ban on U.S. beef, South Korea imposes some of the highest tariffs on beef imports in the world, bound at 40%.”

According to the U.S. Department of Agriculture (USDA), South Korea imported $10.6 billion in agricultural products in 2004.

Mexico Accepts Bone-In Beef

Mexico has resumed trade of U.S. bone-in beef from animals under 30 months of age, Secretary Johanns announced.

“As a NAFTA partner and our second-largest export market, the normalization of beef trade with Mexico is great news for our farmers and ranchers,” Johanns said. “This action demonstrates Mexico’s commitment to trade based on internationally accepted scientific standards for human and animal health.”

USDA reports that more than $874 million worth of beef products was sold to Mexico in 2003, with bone-in beef products accounting for $40 million of that total.

Cattle Industry Convention Coverage Online

Angus Productions Inc. (API) is providing online coverage of the 2006 Cattle Industry Annual Convention and Trade Show — the industry’s largest meeting, hosting approximately 5,000 cattlemen this week at the Colorado Convention Center in Denver, Colo.

Visit www.4cattlemen.com/ncba2006/newsroom.html for synopses of the popular Cattlemen’s College®, sponsored by Pfizer; summaries of committee and subcommittee meetings; and coverage of award winners and trade show highlights as they become available.

Themed “Cowboy Up!” the convention features joint and individual meetings by five industry organizations, including the National Cattlemen’s Beef Association (NCBA), the Cattlemen’s Beef Promotion and Research Board (CBB), the American National CattleWomen Inc. (ANCW), Cattle-Fax and the National Cattlemen’s Foundation (NCF).

Visit the online schedule for a full rundown of general sessions, industry forums, regional caucuses, council meetings, subcommittee and committee meetings, and more. The business portion of the convention will conclude tomorrow with the NCBA Annual Membership Meeting, where decisions are made for the future direction of the industry.

Go to www.4cattlemen.com/ncba2006/newsroom.html for more.

Beef Demand Dips in 2005

Consumer demand for beef dipped slightly in 2005; however the Beef Demand Index remains up more than 20% since reversing its 20-year decline in 1998, CBB Chairman Al Svajgr announced at the Cattle Industry Annual Convention this week in Denver, Colo.

“We had such a stellar growth year for demand in 2004 that we didn’t top that mark in 2005 even though we continued to enjoy terrific strength in the market, including strong prices for cattle throughout the year,” Svajgr stated in a CBB release. The index decreased 3.6% in 2005 compared to record growth in 2004, according to preliminary year-end results.

The Beef Demand Index reflects several specific factors, including per capita consumption and consumer retail spending for beef, but does not take wholesale beef prices into account.

Cattle-Fax estimates that the increase in demand since 1998 has added about $250 per head to the price of fed cattle and about $200 per head to the price of calves, CBB reported.

For more information visit www.beef.org/NEWSBEEFDEMANDDIPSSLIGHTLYIN200524842.aspx.

— compiled by Crystal Albers, Angus Productions Inc.