When dealing with Japanese bureaucrats or government officials, "flexible" and "free-thinking" are not words that spring to mind. But despite its paranoia about mad-cow-tainted beef, Japan has once again decided to allow U.S. exports of beef to reach Japanese tables.
But the lifting of the ban comes with conditions that have some folks howling -- namely, that Japanese officials must inspect various U.S. meat plants. One quote I saw claimed that it's the USDA's job to inspect plants, not Japan's. That's true, but it's also Japan's job to protect its citizens and enforce its own laws and policies. Besides, if you don't like Japan's terms, you don't have to sell to them -- the Japanese are just as happy buying their beef from Australia.
While the Japanese are not exactly famous for consuming mass quantities of cow, their market is nevertheless worth more than a billion dollars a year. Though the benefits for large beef packers like Tyson Foods
Like it or not, though, it's only a matter of time before more squawking arises. U.S. Congressmen and industry-association spokesmen speak as though access to the Japanese market is some sort of divine right. For all of their talk about free and fair trade and "unreasonable" standards, I'd remind them that the U.S. bans the importation of young cheeses made from unpasteurized milk. In other words, it's OK for the U.S. to uphold sometimes-unreasonable food safety laws, but not for the Japanese to do so.
Although I can't see this news as a major mover for Tyson or Smithfield, it's still good news for a sector whose stocks are closer to the lows than the highs. Though I wouldn't suggest any food stock is a "buy and forget," this may yet prove to be a chance to buy into the beef business ahead of an eventual cyclical upswing.
For more Foolish food for thought:
- Smithfield Looks for Deliverance From Protein Glut
- Hormel Still Tasty
- Tyson Gets Gored
- You Bought What?
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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).