1. Beef Production System in Korea

2. Table of Content Overview of Republic of Korea Beef consumption Domestic Beef Production and Imported beef The Hanwoo Beef Future Trends

3. Republic of Korea Area – 100,210 km 2 Population – 50 mln Density – 501.1/km2 GDP (PPP) – 33.156/capita Fertility rate – 1.3

4. Republic of Korea Very fast economic growth – since 60's Growing demand for meat Total meat consumption - 54.1 kg/capita/yr Domestic production – Hanwoo Imports – USA, Australia, New Zealand

5. Beef consumption

6. Domestic vs. imported beef

7. Consumer behaviour consumer preferences for beef are largely influenced by quality, freshness and safety other factor is whether the beef was imported or domestic Hanwoo unique preference for high quality domestic Hanwoo beef colour of meat is very important interest of hygiene and safety rose after the BSE event in 2001 chilled and unpackaged beef is prefered over packaged beef

8. Domestic Beef Production and Imported beef

9. Beef production in Korea Prior to the mid-1970s, beef production was not particularly important in the Republic of Korea, as Korean native cattle were raised and used mainly for draft animals on farms. 1970s, rapid economic development resulted in moving away from agriculture toward the expanding manufacturing sectors. Beef production was perceived by many farmers because of the rapidly increasing demand for beef, particularly in urban areas.

10. Factors affecting beef production and importation YearEventMarket Impact 1976Korean beef imports commenceGovernment control volume 1985All beef imports are bannedDomestic beef prices rise to protect local industry 1988Beef imports resume under quota system US, Australia and New Zealand beef imports resume 1997Asian financial crisisBeef imports drop 45% in 1998 2001Implementation of beef import liberalization Private sector can import beef under 40% tariff 2003US and Canadian beef banned due to BSE Beef imports drop 51% in 2004 and Australia dominates market share 2007US receives "controlled risk” BSE status US beef is imported again 2008US & Korea sign new agreement on beef trade Korea imports almost 32,000 tonnes swt of US beef in 6 months

11. Beef supply in Korea US Import ban 2003 Import liberalizati on 2001 Asian Financial crises 1997 Beef import banned 1985

12. Cattle farm households and Cattle numbers

13. Beef imports by leading suppliers

14. Beef Imports Market share

15. South Korea's Luxury Cattle – Hanwoo Beef Bos taurus x Bos zebu Known for its high degree of marbling Brown coat color Concentrate diet in fattening period for marbling effect Agricultural by-products used in TMR Ave. of 31 months (marketing weight of 694 kg)

16. ”Super Hanwoo Cow” The clones were produced from the body cells of a 3-year-old ``super'' hanwoo cow from Incheon, Gyeonggi Province weigh up to a ton, larger than average hanwoo cows (600 to 700 kgs) Advancement in technology for cloning hanwoo cattle, a Korean native breed - Korea Times, 2006

17. Consumer’s perception of Hanwoo Beef Most expensive beef in Korea Fresher & better quality than imported breeds High marbling, more palatable (eating quality) Higer ratio of n-6/n-3 than Australian Angus beef

18. Carcass Grading System for Hanwoo Beef Yield Grade (A, B, and C), carcass weight, sub. fat thickness, LEA, and maturity Quality Grade (1++, 1+, 1, 2, and 3), meat and fat color, firmness and texture, and marbling score (Beef Marbling Standard, BMS) in Longissimus dorsi (LD) muscle at the 13th rib

19. Premium Class Hanwoo Beef BMS score of 8 or 9 = QG 1++ or 1+ Premium class or High Quality Beef – Lower shear force value than other QG – greater scores in tenderness, juiciness, flavor, and overall likeness of LD muscles than imported beef

21. Future trends Demand for meat will most likely increase Hanwoo production will most likely remain the same Imports most likely to increase