Trading Beefs

Hanwoo Cow (Fotosearch) Sometimes the comment section is good for more than a cautionary tale. The "beef wars" in South Korea took another turn this week, as . To see why, read .

One reason the US cattlemen are interested in the US market is not just the market size. In short a cheap beef in the US is an expensive cut in Korea, and vice versa (for example you rarely, if ever, find tenderloin in Galbi restaurants). All this means that a US beef producer can get a greater yield per cow.

In this case, the problem is the sirloin. In the US this is a distinct cut of meat and simply the loin only, however in Korea the term refers to the loin and part of the chuck. From the US view, it would be in impractical to import the loin whole for two reason:

1. The loin as a whole is more profitable in the US.

2. Since the loin is close to the bone, it is risky to import because a bone “chip� may also be part of the export shipment, which as history shows would cause bigger problems.

So what the US side did was likely to cut so as to create a smaller loin (which was closer to the bone) for the US consumers, and the remaining loin was connected still with a portion of the chuck for Korea. Thus, perhaps in a technical sense only, create the Korean high value cut.

So what does this all mean? Likely the farmers have a point that the label was misleading, and Lotte has a point to since “technically� the cut was proper (it did indeed have a portion of the loin and the chuck, just not in the proportion a Korean Hanwoo cut would).

The on this also, and added:

“The government has to establish a unified standard for names of cow parts and how those parts are cut,� said Kim Jin-a, a customer at the Seoul Station branch of Lotte Mart. “Not just for U.S. beef, but also Korean, Australian and others.�

I (edited):

If what Dram_man is saying is true:

My family always says it’s a matter of “taste�, the flavor of the meat. Korean beef has a distinctive flavor (and now they start sounding like wine connoisseurs). It’s nutty and sweet, and very chewy. If I’m right the cut comes from the stomach. So, that means if American producers export that particularly cut of beef, they can wipe out South Korean producers clean across all niche markets. Right now, South Koreans can say, “Well, it’s cheaper, but I don’t like sirloin or chuck. It’s the flavor!� It’s their choice to pay for the flavor they want, too. But, if American producers export the same cut, and retailers market right, what rational consumer would stick with the expensive stuff (if high-quality Korean equals an inferior cut).

That begs the question, why didn’t American producers just export the same cut as the premium hanwoo cut but with cheaper American beef, and avoid this question of taste?

There seems to be , and it has something to do with fat content, easily discernible by the "marbling", or how lines of fat appear in a cut of beef. What's clear is, that many South Koreans believe there is an objective basis, too. It's hard to know just how firm support for is, but I would bet it is associated with the older generations.

At the time I made the comment, I assumed it were possible to replicate the flavor of premium Hanwoo beef in American beef, but perhaps not.

I was also considering the possibility of some sort of managed trade trade arrangement between US and ROK cattle producers to allow South Korean cattle producers one guaranteed niche market on the premium end. But, if American cattle producers are unable to reproduce the Hanwoo flavor, then there couldn't be a fix. South Korean producers only have , not try to destroy their rival with  or .

Really, though, I'll endure hours of TV programming featuring cute cows, sizzling beef, and practiced expressions of satisfaction as TV stars gobble tons of food, if only average families can at least get a cost of living boost from lower prices for food.

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