Alibaba to beef up US pork sales in China

China Daily (Canada) - - ACROSS AMERICAS - By LIA ZHU in San Francisco li­azhu@chi­nadai­lyusa.com

The US pork in­dus­try is team­ing up with Alibaba to pitch more of its prod­ucts to on­line shop­pers in China.

The US Meat Ex­port Fed­er­a­tion (USMEF), a trade as­so­ci­a­tion com­mit­ted to devel­op­ing in­ter­na­tional mar­kets for US beef, pork, lamb and veal, has re­cently worked with the group-buy­ing web­site Juhua­suan and on­line re­tail plat­form Tmall, both op­er­ated by Alibaba Group, to sell US pork on the Juhua­suan web­site.

A to­tal of 4,000 pack­ages of pork shoul­der and pork chop, weigh­ing about 10,000 kilo­grams, were on sale from April 26 to 28. Nearly 3,000 pack­ages of pork, along with 170,000 bags of spices, were sold dur­ing the three-day sale, which at­tracted 300,000 shop­pers, ac­cord­ing to Lu Jian­ing, Alibaba spokesper­son.

The 400g pack­age sold for 19 yuan ($2.93), or 41.2 yuan per kg, which Juhua­suan said was lower than the Chi­nese mar­ket price of 46 yuan.

Most of the buy­ers in their com­ments said the price was rea­son­able and that they were sat­is­fied with the 24-hour de­liv­ery.

This year, China has ex­pe­ri­enced a short­age of pork along with ris­ing prices. The av­er­age pork price in the week end­ing on April 29 was 26.24 yuan per kg, up from 17.88 yuan the year be­fore, ac­cord­ing to the Min­istry of Agri­cul­ture.

“The ris­ing prices and im­ports of pork have been un­der spot­light lately. The prices of US im­ported pork are lower than do­mes­tic prices,” Lu said. “We think it’s a good op­por­tu­nity to pro­mote our ser­vice. Be­sides, im­ported food at our web­site is very pop­u­lar among con­sumers.”

The pork short­age in China, a re­sult of de­creas­ing hog counts and pro­duc­tion, is also a chance for the pork in­dus­try in the United States to in­crease sales to the Chi­nese mar­ket, which con­sumes about half the world’s pork.

“The US red meat in­dus­try is en­cour­aged by the growth in its pork ex­ports to China so far this year,” said Joel Hag­gard, USMEF’s se­nior vice-pres­i­dent for the Asia-Pa­cific re­gion. “To the ex­tent that ris­ing Chi­nese pork prices make US and other coun­tries’ prod­ucts more com­pet­i­tive, we can ben­e­fit.”

Ac­cord­ing to USMEF, pork ex­ports to China were 86 per­cent above last year’s vol­ume at 73,536 tons and 50 per­cent higher in value at $138.6 mil­lion from the fourth quar­ter of 2015 to Fe­bru­ary this year.

In 2015, China ac­counted for ap­prox­i­mately 9 per­cent of to­tal US pork ex­ports, but year to date, US ship­ments of pork to China made up more than 12 per­cent of to­tal ex­port vol­ume.

“There is still room for growth, how­ever, as US pork ex­ports ac­count for only 20 per­cent to 25 per­cent of to­tal US pro­duc­tion,” said Hag­gard, adding that the ex­ports to China are only 3 to 4 per­cent of US pork out­put.

How­ever, the ac­cess to the Chi­nese mar­ket is “lim­ited and costly”, with China’s “strin­gent” re­quire­ments and com­pe­ti­tion from Eu­ro­pean pork pro­duc­ers, said USMEF Pres­i­dent and CEO Philip Seng in an ar­ti­cle posted on the or­ga­ni­za­tion’s web­site in July 2015.

He said a sig­nif­i­cant per­cent­age of US pork prod­ucts were in­el­i­gi­ble for ship­ment to China be­cause of the use of the mus­cle-en­hanc­ing drug rac­topamine and other fac­tors that con­flict with China’s im­port re­quire­ments, which made it dif­fi­cult to “cap­i­tal­ize on sig­nif­i­cant growth op­por­tu­ni­ties in China”.

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