Skip to navigationSkip to content
A Chinese man and a woman eat hamburger during a Burger King contest in XiAn, northwest Chinas Shaanxi province, January 22, 2007. Obesity levels in China are rising fast, with more than a quarter of the adult population overweight or obese, as people add more meat and dairy products to their diet, causing serious health problems, a new study says. Chinese people now derive a far larger proportion of energy from fat and animal-based foods, such as meat and eggs, compared with in the past, the study found. The change in diets and lifestyles, where Chinese less frequently have to engage in physical activity at work, is consequently leading to a rise in cancer and coronary heart disease. According to the study, the classical Chinese diet -- rich in vegetables and carbohydrates with minimal animal-sourced food -- no longer exists.(Imaginechina via AP Images
Imaginechina via AP Images
Heart disease is on the rise in China.
HIGH STEAKS

Foreign farmers are relishing China’s 30% surge in beef prices

By Gwynn Guilford in Australia

Pork is typically what’s for dinner in China. The country consumes 54 million tons each year and has scrambled for more pork producing capacity, which explains Chinese meat producer Shuanghui’s recent bid for Smithfield. And yet, it’s the price of beef, not pork, that’s skyrocketing.

Beef prices surged 28% in June (link in Chinese) compared with the same month in 2012 (even though overall inflation was just 2.7%). Beef prices have risen 30% every month for the past year:

(Note: the 2011 spike in pork prices was due to the hog cycle and an outbreak of swine disease the previous year.)

The rise in beef prices has dissipated slightly since its February 2013 peak of 35%. Around that time, demand for beef imports began rising sharply in response. China imported 75,000 tonnes (82,000 tons) of beef from January to April—a tenfold increase compared with the same period in 2012. The import surge has taken a slight edge off rising prices, but not much.

So what’s behind China’s hyperinflating beef?

Rising demand due to improving living standards is one reason. Chinese consumers generally don’t cook beef at home (pdf, p.16), but it’s a popular choice for eating out, particularly in hotpot and Korean barbecue.

"Food Consumption Trends in China April 2012," Zhangyue Zhou, et al.
Urban at-home meat consumption based on yuan spent per capita (pork on the left; beef on the right). Note that beef dominates in the pastoral areas (and Muslim-heavy regions) in western China.

Beef has become particularly popular among Chinese in their early 30s and younger (link in Chinese), as Zhao Hang, the deputy director of the China Animal Husbandry Association Cattle Industry Branch, told Yicai. Zhao says he expects Chinese consumption to continue to surge as a result.

Beef exporters stand to benefit for several reasons. Foreign beef is becoming more affordable thanks to the rising value of the yuan, which has strengthened nearly 4% over the last year.

Also, highly publicized food safety disasters have left Chinese consumers favoring foreign meat, which they perceive to be of higher quality.

Meanwhile, Chinese beef supplies have fallen as the country’s herd has steadily declined. In 2000, there were 97 million heads of  beef cattle in China; in 2010, there were only 67 million, according to official data. Making a decent living raising beef cattle in China is difficult given skyrocketing real estate and animal feed prices, according to Zhao.

But more farmers are entering the business again now that beef prices are rising, which drives up calf prices, too. Those have leapt from $234 per head two years ago to as much as $979, Yicai reports.

Since it takes several years before cattle can be brought to slaughter, beef prices and imports will remain high for a while.