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Thursday, Oct. 5, 2006

CONSUMERS STILL SKEPTICAL

U.S. beef hard sell as concern lingers, Aussies fill void


Staff writer

Michal Small has been waiting eagerly for the return of U.S. beef to Japan, but it seems the American will have to wait a while longer before the Roppongi Hills restaurants she frequents start serving the fare again.

"I think American beef is absolutely safe. And now is the best time to buy it because there's so much scrutiny," said Small, who lives in Tokyo's Minami-Azabu district and comes from a family in Oklahoma that raises cattle for consumption by them and their friends.

But while Small may be eager to bite into a thick U.S. steak, the Japanese public's mistrust stemming from the risk of mad cow disease doesn't appear to be waning.

The fact that there aren't enough cows meeting the current standard of import -- under 21 months old with at-risk parts removed -- leads to a limited supply and resultant higher prices, another reason for the slow return to Japan.

Businesses have other reasons as well. Australian beef now has a strong presence, having filled the vacuum left by the recently lifted ban on U.S. beef. Many restaurants have found ways to do without U.S. beef, and its return offers few incentives to go back.

According to trade statistics announced by the Finance Ministry, a mere 105 tons of U.S. beef was imported in August. Before the ban at the end of 2003, the monthly average was approximately 20,000 tons. The ban was instituted after the U.S. had its first case of mad cow disease that December. Japan to date has 29 confirmed cases.

Wholesale prices for chilled U.S. short plate, the part Yoshinoya D&C Co. uses for its "gyudon" beef-on-rice dishes, check in at about 950 yen to 1,050 yen per kg. The same part, but frozen, used to cost about 600 yen per kg before the ban, according to a major trader.

U.S. boneless short ribs, served as "kalbi" in Korean barbecue -- another Japanese favorite -- can cost as much as 3,200 yen per kg, close to 30 percent more than the 2,500 yen it went for before the ban, he said.

Under such circumstances, only a handful of restaurants and retailers are selling the meat two months since the first shipment arrived Aug. 7 after the ban was lifted.

Well-known are Costco Wholesale Japan Inc. and Yoshinoya, which held a one-day-only revival campaign of its signature beef bowl in February 2005 and again on Sept. 18. Since Sunday, it has been running the first of two sets of five-day campaigns. It is hoping for a full-fledged return in December.

The only retailers other than Costco known to be selling the meat are a supermarket chain in Hokkaido and another in Ishikawa Prefecture.

Two Korean barbecue restaurant chains -- Den, operated by Osaka-based Zenshoku Co., and another large chain, Yakinikuya Sakai Co. -- have said they are serving U.S. beef. A third, Nagoya-based steak chain Asakuma, said it will follow in November.

Zenshoku public relations official Tae Okuda said she was pleasantly surprised by her customers' confidence after the barbecue chain on Aug. 29 became the first to serve U.S. beef again.

"I think the (safety) issue has been talked out. People think it's safe to eat U.S. beef again," she said, adding that 50 percent, rather than the expected 30 percent, of all customers have ordered U.S. beef.

Demand for U.S. beef, though small, is higher in Japanese restaurants than in American chains.

Calls to numerous American restaurants found that none has plans to offer U.S. beef, partly because of the low cost of Australian beef and partly because of customer concerns.

Akio Uchida, a PR official at WDI Corp., which operates Hard Rock Cafe and Tony Roma's in Japan, said that while the two restaurant chains used to serve U.S. beef, they now mainly go with Australian beef and occasionally offer Japanese beef on special menus.

"When U.S. beef was not available, we established the knowhow on the amount of spices and other ingredients we need to make a good burger using Australian beef. We also have deals for future orders of Australian beef. It's difficult to change now," Uchida said.

Both McDonald's Co. Japan and Sizzler, the California-style restaurant operated in Japan by Royal Casual Dining Co., also said their use of Australian beef leaves no room to consider U.S. beef.

"We've been using only Australian beef with some New Zealand beef, and no U.S. beef for more than 10 years. This is because there are more transport and cost benefits, and not because U.S. beef is unsafe," said Kenji Kaniya of McDonald's.

Yasushi Aoshima of the New York Grill in the Park Hyatt Tokyo said the restaurant will think about returning to U.S. beef in the future.

"We will consider serving American beef once its safety is confirmed and recognized in society," he said.

Koushiro Suzuki of Yakinikuya Sakai said demand for U.S. beef is higher in Japanese and Korean restaurants because American beef, which is grain-fed and fatty compared with the grass-fed and leaner Australian beef, is more similar to Japanese beef but not as expensive.

But this does not apply to Western food because appreciation for fatty meat is a Japanese thing, and in food like hamburgers, the meat in Japan is mixed with other ingredients so the taste of the original meat doesn't matter so much, he said.

The return of U.S. beef may be slow, but consumer groups still fear that because Japan's rules on food labeling are "inadequate," people could unintentionally be eating it even if they don't want to.

The Agricultural Standards Law states that all uncooked meat sold in shops must be labeled with the country of origin. On Monday, the law was expanded to include meat that has been processed once, including marinated raw meat.

However, it does not apply to meat processed more than once, like a hamburger patty that has been mixed with other ingredients and then shaped.

Labeling is also not required for meat when it is less than half of the total product. For example, U.S. beef does not need to be identified when it makes up 49 percent of a 100-gram ground beef-and-pork mixture.

The rules are even less strict for restaurants.

While the farm ministry drew up a guideline in July 2005 calling for restaurants to label the country of origin for their main ingredients, including steak, it is not an obligation and there is no penalty for noncompliance.

Hiroko Mizuhara, chief of the Consumer Union of Japan, said that replies to a questionnaire her group sent to restaurant owners indicated some consider only their own benefit, like price, when deciding what meat to use.

To protect consumers, her group and other citizen organizations launched a petition drive in September to urge the government to adopt stricter rules on labeling.

"We consumers have the right not to consume U.S. beef, the safety of which is not confirmed. If shops and restaurants do not label it properly, we will simply counter by not eating out, or not buying food we suspect has U.S. beef in it," Mizuhara said.



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