South Korea-Beef importers strapped for cash.

KOREA-IMPORTERS STRAPPED FOR CASH.

Korean beef importers continue to face an unfavourable set of market conditions. The strong depreciation of the Korean won against the US$ has affected the value of their stock while the recession is impacting beef demand and the credit crunch is tightening bank loans.

Traders in the beef market are lowering their stocks and trading on a hand-to-mouth basis in order to secure funds to pay off their bank payments due this month. This could make March a difficult month as most usance bills and other financial instruments for companies reach their expiration dates (Meatnews, 2009).

US beef imports are steady, but wholesale prices for US cuts in the Korean trade market keep decreasing due to lack of demand. Korean prices for most Australian cuts remained similar to last week.

Australian beef exports to Korea totalled 8,306 tonnes swt in February this year, an increase of 94% on January. This month’s exports were 14% lower than average beef exports in February from 2004 to 2007. However, chilled beef now represents a higher proportion of total exports to Korea with 9.5% in February 2004 being in chilled form compared to 26% last month.