Question

Is south korea an attractive market for australian beef？

What are the aspects?

Answer 1

An analysis of the current Australian and South Korean beef industries; the conditions required to produce beef most efficiently, following the Heckscher-Ohlin Model; tariffs that are involved with these trades, and the impact of the Korea-Australia Free Trade Agreement; environmental implications to Australia; as well as the cultural environment and geographic factor, will be discussed to determine whether South Korea is an attractive market for Australian beef. Australia’s primary exports lie in natural resources and agricultural commodities (Siriwardana, 2015). The Australian beef industry is the sixth largest exporter in the world where average beef exports from Australia are approximately 1.3 million tonnes, amounting to approximately 65% of total beef production (Tozer and Marsh, 2012). In a global context, Australia is the sixth largest beef producer and the second largest beef exporter, therefore it would be most efficient for Australia to trade with other nations who produce and export beef less effectively (Meat & Livestock Australia, 2016).

Australia is the largest beef exporter in the world. Over 60 per cent of Australia’s beef and veal production is exported every year. Korea is the third largest export market for Australian beef after Japan and the United States. Since the Asian fi nancial downturn in 1997-98, there has been a signifi cant downturn in beef production in Korea. Accordingly there has been increasing reliance on imported beef, which accounts for around two-thirds of Korean beef consumption. The discovery of BSE (bovine spongiform encephalopathy or ‘mad cow’ disease) in the United States in December 2003 substantially disrupted US beef exports to the major Pacifi c Rim beef markets of Japan and Korea. In most years, the United States is the largest supplier of imported beef for both markets. After the discovery of BSE in the United States, the Australia beef industry had an opportunity to increase its share of the Korean beef market. However, the volume of Australian beef exports to Korea in the fi rst half of 2004 fell slightly because of reduced production in Australia and the apparent diversion of some exports to the Japanese market which had also banned the import of US beef. In this report, the situation and outlook for production, processing, marketing and consumption of beef in both Korea and Australia are discussed. Within this context, policies affecting each industry are clearly important to the future development of these industries in both countries. Korea can be expected to become an ever more signifi cant market for the Australian beef industry in the future. For its part, it seems likely that Korea will tend to look more to overseas sources for an increasing proportion of its beef consumption requirements.