Large Retailers In S Korea To Resume Sales Of US Beef - Group

WASHINGTON --Starting this week, hundreds of high-volume discount retailers in South Korea will be selling, for the first time in more than a year, U.S. beef again thanks to rising demand and waning fears of mad-cow disease, according to the U.S. Meat Export Federation.

The South Korean retailers, according to a statement released Tuesday by the USMEF, believe "there is no longer any reason for them not to carry price-competitive U.S. beef."

The U.S. group has been working with smaller retailers in South Korea for months to build acceptance of U.S. beef in the country, said USMEF vice president Jim Herlihy, and the fact that the bigger chain stores are ready to follow suit is a significant breakthrough.

"What we had to do is demonstrate to the bigger retailers that consumers were ready," Herlihy said.

And that acceptance is key because about 40,000 tons of U.S. beef has "backed up" in cold storage since South Korea resumed importing beef from the U.S. in July, Herlihy said.

South Korea banned U.S. beef in December 2003 after the first case of bovine spongiform encephalopathy, or mad-cow disease, was discovered in the country. South Korea partially lifted that ban in September 2006 to allow only boneless cuts from cattle under 30 months of age, but disputes over bone fragments in U.S. shipments repeatedly shut down trade.

Trade resumed in July after South Korea agreed to lift its prohibition on bone-in beef cuts, but the country continues to only import beef from younger cattle.

Jihae Yang, a USMEF director in Seoul, said in the Tuesday statement: "Although the decision by these stores to re-stock U.S. beef is very encouraging, we will be watching the consumer response very closely."

But if all goes well, USMEF President Philip Seng said, the decision by the chain stores to sell U.S. beef will lead to even stronger acceptance.

"The timing of this week's large retailer re-launch is expected to lead other retail and restaurant chains to feature U.S. beef before the lunar New Year peak consumption period in late January," the group said in the Tuesday statement.

-By Bill Tomson, Dow Jones Newswires; 202-646-0088; bill.tomson@dowjones.com