Australia’s beef market is buzzing with activity as the country nears the end of 2024. With just 7,378 tonnes of the preferential beef safeguard into Korea remaining, Australian producers are closely monitoring the situation. Let’s dive into what this means for Australian beef exports and gain some insights from the market.
### What it means for Australian beef exports
– Australia can export 188,437 tonnes swt of beef to Korea in 2024 at a 10.6% duty.
– Once the safeguard is triggered, the duty on Australian beef will jump to 24% for the rest of the calendar year.
– Product shipped before the safeguard trigger but yet to clear customs can enter at the lower tariff rate, with the excess tonnage deducted from the 2025 safeguard volume.
The impending safeguard tariff increase in 2024 puts Australian beef exports at a disadvantage compared to US products in the Korean market. The tariff differential between the two suppliers will increase from 5.3% to 18.7% for the remainder of 2024.
### The context: market insights from MLA’s Korean office
– The safeguard has been triggered every year since KAFTA came into force, except in 2022.
– Australia will trigger the Korea beef safeguard volume earlier than in recent years in 2024.
– Chilled grassfed beef exports from Australia to Korea have seen a significant increase, particularly through retail channels.
Korea’s challenging economic circumstances post-pandemic have led to a shift in consumer behavior, with increased demand for cheaper beef products and cuts. The recent public holidays in Korea have stimulated domestic consumption, boosting beef sales, especially within the foodservice sector.
### The Namno effect
– Korean celebrity chef Namno Yoon, known for promoting Australian beef, has had a significant impact on consumer perceptions.
– Namno’s success in the popular Netflix series ‘Culinary Class Wars’ has further elevated his profile and influenced consumer preferences.
– The launch of Namno’s marinated Aussie chilled beef products in supermarkets is expected to boost Australian beef sales in Korea.
In conclusion, the dynamics of the Australian beef market in Korea are evolving rapidly, with factors like trade agreements, consumer preferences, and celebrity endorsements influencing the landscape. It remains crucial for Australian beef exporters to adapt to market conditions and leverage opportunities for growth.
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