“Mr. Secretary, the beef from your state has found its destination.” – Jeong Min Park, U.S. Meat Export Federation
That we found Kansas-processed beef in Han Jung, South Korea really wasn’t a surprise. But it took some searching; we actually had to tour a couple of different cold storage facilities. And this was a search close to Kansas Ag Secretary Dale Rodman’s heart; he was in Cargill’s management team when Cargill built its packing plant in Dodge City.
So when we found it; it was like Indiana Jones finding the Lost Ark. Thus, the quote from Mr. Park.
Koreans have developed a taste for American goods and services. This isn’t surprising, as more than 100,000 Korean students attend college in America each year. There is a lot of travel into the U.S. from Koreans and exposure to our culture has certainly influenced theirs. Personal incomes of Korean people are rising (about $23,000 per year in 2011) and as incomes rise, diets tend to change in favor of more meat protein. As such, meat is a much larger portion of the diet than ever before.
Unfortunately, Korea’s farms are small; from 2 to 7 acres, with the average farmer also raising 7-8 cows. The food produced on Korean farms is very high-quality – the people here are fastidious about details – but the food is also expensive. Koreans spend about 25% of their income on food (the average American spends about 11% on food.)
Still, Koreans are entrenched in the concept of “local food;” that the food produced by Korean farmers is the best. And it is quite good – our team was able to sample locally grown foods – but that is not sustainable. A country of this many people simply cannot feed itself.
Thus, Korea needs to import food, and lots of it. It is the fifth largest market for food in the world. The United States has become Korea’s largest trading partner. The recently passed Korea – U.S. Free Trade Agreement (KORUS) will only serve to increase trade between the two countries. In 2011, Korea imported $26 billion in goods from the U.S.; in 2016, Korea is expected to import $90.6 billion worth of U.S. goods.
Today, we visited Hanjung Cold Storage, which holds meat imported from other countries, including the U.S. Several members of our party were enthused to see the boxes of meat in cold storage, as some of them were sourced from the U.S.
Hanjung has a processing plant of its own, in which jerky, pre-packaged and prepared meats are manufactured. Beef is becoming a larger segment of the average Korean’s diet, making up about 20% of their meat diet. (Fish is 50%; pork is 15%; poultry the remainder).
We also visited the Daehan Flour Mill and Daehan Silo, located in the Port of Incheon. The company has 400,000 metric tons of flour milling capacity per year. Wheat is shipped into the Port from the U.S., Canada and Australia. About 50% of the grain is from the U.S., with 10% of that Hard Red Winter wheat, which is milled into multi-purpose flour for noodles and breadings. Consumption of Hard Red Winter wheat is increasing in South Korea, but many baking companies are building their own flour mills.
Upon leaving the Daehan Flour Mill, we headed to the airport to depart for Beijing. Tomorrow, we learn about China.