S. Korea to allow U.S. beef in again
Posted on Thursday, April 27, 2006
South Korea, the third-biggest buyer of U. S. beef in 2003, will resume imports from the United States after confirming a cow infected with mad-cow disease in Alabama was born before feed restrictions were imposed.
South Korean veterinarians who visited the United States confirmed the cow was born before April 1998, the country’s Ministry of Agriculture and Forestry said in an e-mailed statement Wednesday. The confirmation means inspection procedures that were suspended last month will be resumed.
Resuming imports may benefit companies such as Springdale, Ark.-based Tyson Foods Inc., the world’s biggest meat processor, which suffered from the collapse in exports after mad-cow disease was found in the United States in 2003.
Tyson Foods spokesman Gary Mickelson said Wednesday that the company is eager to resume business with South Korea.
The country “was our second-largest beef export market, behind Japan, before the BSE-related ban took effect more than two years ago,” he said.
Most of the more than 60 nations that banned U. S. beef have since eased their bans. The U. S. Department of Agriculture said no date has been set for trade to start.
“Anyone who is accredited to export to Korea and can do so at a profit will obviously win,” Bill Cordingley, senior analyst with Rabobank Groep, the world’s largest agricultural lender, said from Brisbane, Australia. “It gives them an opportunity to sell certain cuts at much higher prices than they can in the domestic market in the U. S.”
Cattle futures for June delivery rose 0. 3 cent, or 0. 4 percent, to 73. 52 cents a pound when last traded on the Chicago Mercantile Exchange. Prices have fallen 24 percent this year.
South Korea bought $ 800 million of beef from the United States in 2003 and Japan bought $ 1. 4 billion, before both countries imposed two-year bans. Madcow disease, or bovine spongiform encephalopathy, has a fatal human form known as variant Creutzfeldt-Jacob disease.
Australia’s sales to Korea, the third-largest market for Australian beef, could fall 30 percent in 2006 if U. S. meat enters the Asian nation by June or July, Peter Weeks, chief economist with Sydney-based trade group Meat and Livestock Australia said Wednesday.
Australia, the world’s secondbiggest exporter of beef, sold a record 106, 448 tons of the meat to Korea in 2005, 14 percent more than the year earlier, worth $ 370 million.
Agriculture Department spokesman Ed Loyd said a date for South Korea to resume purchases will be determined in negotiations.
Tyson Foods, which had its first loss in five years in the quarter that ended April 1, said the second-quarter loss at its beef unit, the biggest by sales, would be more than $ 120 million, about double first-quarter losses.
Shares of Tyson, which reports full earnings for the fiscal second quarter Monday, rose 70 cents or 5. 1 percent to close at $ 14. 42 on the New York Stock Exchange on Wednesday. Information for this article was contributed by Cristal Cody of the Arkansas Democrat-Gazette.
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