While the government accuses China of artificially devaluing its currency, U.S. cattle producers often complain that packers are manipulating their markets. This week the Supreme Court declined to hear a case brought by producers who blame Tyson Fresh Meat's use of marketing agreements to control large volumes of cattle. The plaintiffs claim the so-called "captive supply," effectively eliminated the cash market and thereby depressed prices. And so it goes in the beef industry, where prices increasingly are influenced by forces well beyond the control of producers. A case in point can be found in Japan, where the government continues its ban of American beef. This week, USDA took more steps to regain Japan's confidence in the industry.
Additional training will soon be required for American workers handling beef exports to Japan. A U.S. agriculture delegation in Tokyo this week agreed to the training -- and agreed to follow up -- to ensure beef workers know what meat products are prohibited in Japan and which are allowed.
This comes after Japan stopped importing U.S. beef on January 20, when spinal bone was found in a shipment of veal. Japan considers bone to be at risk for mad cow disease.
Going into the talks, USDA secretary Mike Johanns told reporters, "There'll probably be some additional questions. We'll respond to those very quickly. But there's a point where this needs to be resolved, and we have really reached that point now."
USDA has been telling the Japanese that the shipment of the prohibited veal was due to a government inspector's misunderstanding of the new rules for selling beef to Japan.
That misunderstanding has been costly to the U.S. beef industry. Prior to the ban, Japan was one of the largest purchasers of U.S. beef, buying $1.4 billion worth in 2003.
Meanwhile, Japan has replaced American beef products in large part with Australian beef. The country down under now makes up 51% of the beef consumed in Japan. That's 412,000 tons of beef last year – up from 284,000 tons in 2003.
Beef imports from New Zealand to Japan have also grown. And Canada is re-entering the Japan market after its beef products – like the U.S. -- were banned in 2003 due to the discovery of mad cow in that country.