It’s 10 p.m. You open the refrigerator to find you are out of milk and bacon. How can you have breakfast without that pair? Now imagine the fastest “Amazon fulfillment center” processing your order overnight and delivering a carton of milk and pound of bacon to your doorstop by 6 a.m. the next morning.
“That may seem unachievable in the U.S., but that’s happening in South Korea with fresh products, in addition to chilled and frozen pork and beef,” says Josh Maschhoff, Illinois Pork Producers Association president and sixth-generation pork farmer. Maschhoff was part of the 21-member delegation made up of U.S. corn, soybean, beef and pork farmers visiting South Korea with the U.S. Meat Export Federation (USMEF) advocating about U.S. agriculture and trade.
Maschhoff says it’s time to open our eyes as a country to the possibility of these conveniences.
Full of Opportunity
South Korea is comparable to the size of state of Indiana, Maschhoff describes. Just picture that size of a region with 43 million more people in it.
“It’s dense,” he says. “It’s a lot of high-rise buildings, urban populations, and not a lot of opportunity to travel. Convenience is really important in their lives.”
In addition to convenience, Andy Tauer, vice president of international market development at the National Pork Board, says flavor is just as important priority for the consumers in South Korea.
“Flavor profile is huge,” Tauer says. “Pork brings the flavor to the table already, but then they add a little bit of Korean spice to it once it gets here. There is a lot of opportunity for further development of some additional U.S. pork products here in this marketplace.”
The aging population of the South Korean consumer was eye opening to Maschhoff.
“We have to figure out how to adapt our product and work with the retailers and the brokers here to market to those specific demographics,” Maschhoff says. “A common trend in Korea is the uptick of home meal replacement, where they can get a prepackaged product that contains meat and vegetables and could even be seasoned or precooked.”
He says that is one example of matching convenience and the need to create products that South Korean customers value.
Jay Theiler, executive vice president for corporate affairs at Agri-Beef and USMEF chair elect, says he appreciates the value USMEF brings in trying to figure out how to market beef in new ways that can bring more value to producers.
“One example is really thin slicing of products for things like shabu-shabu,” Theiler says. “The trip also opened my eyes to markets for cuts we don’t use in the states, like tendons in soup. It’s so diverse the way the products are consumed here. That’s where the whole puzzle works. When you could get the different pieces and parts going to the right markets and create more value for us as producers.”
Sparse Shelves
It’s not as easy as “ship it and they will buy,” but Maschhoff says the shelves were a little sparse when it came time to find U.S. pork in the stores.
“The good side about that is it’s sparse because two weeks ago, the shelves were stacked and it flew off the shelves,” he says. “The U.S. is challenged in the current market, with Canada and a few others being able to come in here with a little cheaper price, and they’re filling more of the case right now, but that’s a small hurdle.”
Another challenge is connecting South Korean customers with packers and distributors to get them the product that they need in the specifics that they’d like to see it.
“Belly is the No. 1 pork product they import, and if we think about how popular bacon is in our domestic market, we’re limited in our opportunity,” Tauer points out. “But to their credit, they’re making bacon out of Boston Butt and some picnic bacon. They’re finding opportunities to continue to utilize that that U.S. pork product to deliver what the consumers are demanding here in South Korea.”
Ryan Moorhouse, Cattlemen’s Beef Board chair, expects beef demand in Korea to continue to grow.
“If you look at the amount of American beef that Korea has taken, it’s kind of straight up for the last 10 years,” Moorhouse says. “They like our product. They like American products in general. It’s a very competitive market, but it’s also a market where they eat a ton of protein. I think they’ll continue to eat more and more protein with the population that they have.”
Culture Connection
In addition to better understanding market opportunities, Tauer says these trips help U.S. farmers better understand international customers. They are a great way to form valuable relationships that could open doors in Asian markets.
“Being able to bring our U.S. producers over here so they can meet processors, retailers and give that story firsthand is key,” Tauer says. “For example, Josh gave a presentation to about 100 or so buyers in Korea about the sustainability efforts that not only he and his family are doing on their farm, but across the entire pork spectrum. As we’ve traveled around South Korea, we’ve seen a lot of sustainable labeling and animal welfare labeling. Being able to put that personal connection to their priorities is really important and helps continue to build that confidence and preference for U.S. pork.”
Maschhoff’s first trip to Asia, he was impressed with the politeness of the Korean culture.
“They have really aligned with the U.S. and depend on us to supply them with products they can’t supply on their own,” he says. “It makes you feel grateful that you can do that for them, and it’s something we take great pride in, being able to provide food for other people.”
It also reminded him of the importance of farmers telling their story and thinking more deeply about what the consumer (domestic and international) wants to buy.
“Dollar for dollar, as a pork producer or a beef producer, our checkoff dollars are well spent when investing in promotion with USMEF because we get that match with USDA funding. It goes a long way with helping to bridge the cultural gap and trying to innovate and think about different ways we can put our product on an international plate in a way that makes those consumers really appreciate it,” Maschhoff says. “Rather than us trying to push product to them, it’s letting them pull it from us in a way that they’d like to see it.”
Tauer hopes producers see the value that the international component brings to the overall pork cutout.
“As we think about some of these markets and the different products they want and desire from the U.S., these aren’t products that our domestic consumers are going to eat on a daily basis, or ever, quite frankly,” Tauer says. “Don’t forget that $64 to $66 is what the international market adds to the overall pork (carcass) value.”
Future Food Fulfillment
Maschhoff is the first to admit he “geeked out” a little at the technology in that fulfillment center in South Korea – that’s his engineering background coming through. But he says it’s more than that.
“Tasting what pork can do is not just about the quality or the versatility, but it’s about us trying to figure out how to make that convenient,” he says. “The fulfillment center concepts just make me hungry for why we need to go try to execute that same sort of a model in the domestic market. I think there’s a wealth of opportunity that we have not tapped yet. It’s easy to say, ‘Ah well, American consumers wouldn’t see that as something.’ But I think we need to keep an open mind and learn from other countries.”
Listen to more about the trip on AgriTalk with Chip Flory.
