While re-entry of United States beef into China could ''put the squeeze'' on New Zealand beef exports, it may also lead to some opportunities, an American expert says.
China recently decided to lift the ban on importing US beef which has been in place since 2003, implemented because of mad cow disease in the US.
That was probably related to China's increasing demand for beef, Prof William Bailey, from Western Illinois University, said in ASB's International Agri Insights report.
Since 2012, beef imports into China had increased 10-fold, from 86,000 to 825,000 metric tonnes in 2016.
This year, imports had surged more than 50% from 2014 levels, partly due to domestic production problems.
The growth in Chinese demand for beef followed patterns seen in other countries. As incomes increased, so did the demand for beef as people bought beef instead of less expensive protein, Prof Bailey said.
In 1990, per capita consumption of beef in China was 0.9kg a year. By 2013, it had grown to 4.3kg.
While that figure was low compared to some other countries - including New Zealand at almost 74kg a year - a small increase in per capita consumption translated into a significant increase in demand, with China's huge population.
When the US import ban was implemented, other countries, particularly Australia, Brazil, Uruguay and New Zealand, stepped in to meet China's beef needs.
The timeline for when the first shipment might arrive from the US was very unclear, Prof Bailey said.
While China had agreed to lift the ban on imports, what it had really agreed to was to begin negotiations with US officials to establish protocols permitting imports.
When it did happen, some exports from New Zealand would probably be squeezed out but it might well open up new opportunities for New Zealand exporters as US exports moved from current markets to China.
One of those opportunities might be in the US because, if total US exports increased, the US domestic market might be under-supplied.
There was also another opportunity in US grass-fed beef with demand for that product having ''really taken off''.
Grass-fed beef was a market segment growing as per-capita beef consumption declined.
To meet that growing demand, US companies had turned to importing beef from various countries, including suppliers that were important beef suppliers to China - Australia, Uruguay and New Zealand.
But country of origin labelling could present a hurdle for New Zealand grass-fed beef, Prof Bailey said. The American Grass-Fed Association had established its own set of guidelines to provide some consistency to inform consumers that products, labelled as grass-fed, met certain standards.
Those standards included origin - all animals must be born and raised on American family farms - and that could affect New Zealand beef,
The latest Rabobank Agribusiness Monthly said New Zealand beef exports between January and August fell 6% year on year (YOY) to 311,136 tonnes swt, underpinned by a 10% decline in shipments to the US over the same period.
Reflecting the high kiwi and challenging export environment, average export returns over the same period declined 8% YOY, averaging $6.69kg FOB.