Navigating Japan’s high-value beef market

Bord Bia recently organised a promotional seminar in Tokyo, which attracted more than 50 major Japanese beef buyers. This event formed part of an EU-funded campaign which seeks to highlight Europe’s high standards of food safety, quality and sustainability across several Asian markets.

Ireland regained market access to Japan in late 2013, and exports of Irish beef and offal there increased four-fold to €7m last year. Until now, Irish shipments have consisted mainly of frozen tongues, along with some other offal items (thinskirt, thickskirt and parts of the tripe).

However, the recently announced Economic Partnership Agreement (EPA) between the EU and Japan will create greater opportunities to export actual beef cuts there. In the first year of implementation, import tariffs on beef will be lowered from 38.5% to 27.5%, in line with our international competitors. The rate will gradually reduce to 9% over the period of the agreement.

The Japanese market has a population of 127 million relatively affluent inhabitants, and is just 40% self-sufficient in beef. In 2016, beef imports totalled 504,000 tonnes, along with 106,000t of beef offals. Key suppliers include Australia (53%), USA (35%) and New Zealand (5%).

Wagyu breed

During the Bord Bia-led mission, a delegation including the Department of Agriculture, Food and the Marine and Irish beef industry representatives took the opportunity to learn more about the famous Wagyu breed of Japanese beef cattle.

The breed itself has several different strains, although Japanese Black accounts for approximately 90% of calf births. Beef from Wagyu animals is characterised by the rich concentration of intramuscular fat, or marbling, in its meat. This attribute is further intensified by the long duration of the finishing period.

On average, steers enter the fattening stage at around 10 months old and are not slaughtered until they reach 28 to 32 months of age, with carcase weights ranging from 450kg to 650kg.

It was most unusual to visit a municipal (state-owned) meat plant in the centre of Tokyo city, slaughtering 430 cattle and 1,400 pigs daily. The Irish group was equally intrigued by the system of valuation for the beef carcases. Having been chilled for 24-48 hours, carcases enter the adjoining Shibaura meat market, where they are auctioned individually in front of a large audience of wholesale buyers.

Each of the prospective bidders must register at the beginning of the sale, whereupon they receive a wireless transmitter with which to subtly place their bid. Once a carcase is presented on the auction rail, a large screen lights up to display the key information of relevance to the buyers, such as its weight and grade, as well as the price per kilo it is selling for.

A significant price differential was visible between the premium carcases and those deemed to be of poor quality. Buyers place particular emphasis on conformation and marbling, as well as on the brightness of the meat colour and the whiteness of the fat.

The carcases are manually graded by an expert representing the Japan Meat Grading Association (JMGA). Firstly, a yield grade is assigned, which ranges simply from A (well-conformed beef animal) to C (poorly shaped dairy type). Carcases are then graded on marbling, from one (least) to five (most), based on a cross-section taken between the sixth and seventh rib.

At the bottom end of the market, some pure-Holstein steer carcases, which graded C2, sold for between 650 and 750 yen/kg (approximately €5 to €5.70/kg deadweight. €1 is equivalent to 130 yen.)

In the mid-range, a line of Wagyu-Holstein F1 cross steers, grading B3, made from 1,300 to 1,500 yen/kg (€10-€11.50/kg). Most impressively, a significant proportion of the pure-bred Wagyu steers graded A4 and A5, and these generally achieved prices of 2,600 to 3,000 yen/kg (€20-€23/kg). The Irish delegation was amazed when one particular A5-grading carcase, weighing 630kg, sold for 3,100 yen/kg (€24/kg) or over €15,000 for the bullock.

Given its high beef carcase value, it is not surprising that the traditional Japanese barbeque style, Yakiniku, involves cooking small, thin strips of the marbled meat, rather than actual steaks. Carcase utilisation is critical. As the marbling fat (or Sashi in Japanese) melts during cooking, it brings out the juiciness and flavour of the beef.

Wagyu animals are no longer unique to Japan, and a number of beef-producing countries, including Australia and New Zealand, have seen the development of niche programmes and producer groups. Even within Ireland, there were approximately 500 calves registered to Wagyu sires in 2016, up from just 300 the previous year. This follows initial success by a number of Irish butchers in marketing this unusual delicacy.