[Source/Observer Network by Zhang Jingjuan] The tariff conflict initiated by US President Donald Trump is impacting the foodservice industry.

According to a Reuters report on the 21st, staff at an American-style restaurant in Beijing are busy reprinting menus. Due to the China-US tariff conflict, the beef that was once the signature ingredient of this restaurant will soon disappear from the menu.

The restaurant, called Ben Lei American BBQ, previously used all its beef from the United States, but is now gradually switching to Australian beef. The restaurant consumes about 7 to 8 tons of brisket per month; after the remaining American beef in their freezers runs out in the coming weeks, this restaurant will fully switch to Australian beef.

The report states that American beef is just one of thousands of casualties in the trade war. Before the trade war broke out, the price of American beef was already high. After China announced countermeasures and imposed a 125% tariff on imports originating from the United States, the price of American beef further increased.

"This makes it very difficult for us to continue using American beef," said Charles de Pellette, the restaurant's operations director. Although the monthly $125 million worth of beef exports from the U.S. to China is negligible compared to the massive volume of goods trade, the disappearance of American beef from Beijing menus foreshadows the fate of tens of thousands of products on both sides of the Pacific Ocean.

Pellette stated that once their inventory runs out, they will fully switch to M5 grade Australian beef, which has the same taste, quality, and flavor as American beef. He added that the supply source for pork ribs is also changing, and they will be imported from Canada.

A Beijing beef supplier who wished to remain anonymous said that the experience of this chain restaurant, founded by Texans with three branches in China, is being repeated in various restaurants across Beijing. "They must switch to Australian beef, even steak-focused restaurants," he said.

Beef cattle in Texas, USA, are eating hay. IC Photo

In fact, before the trade war erupted, the price of American beef had been steadily rising, partly due to prolonged drought conditions leading to the lowest cattle population levels since the 1950s. According to reports, between May last year and March this year, the price of American brisket had risen nearly 50%, and after the tariff increase, it skyrocketed further, resulting in stock depletion or costs nearly doubling compared to a year ago.

Both American and Australian beef primarily flow into mid-to-high-end retail channels and the foodservice sector, where they have always been competitors. Now, Australia is attempting to fill this gap, with its brisket prices 40% lower than those of the U.S.

The report points out that for Ben Lei American BBQ, the transition is already showing initial success. Starting in May, diners will taste Australian beef ribs, brisket, and sausages smoked according to traditional Texas and Southern U.S. techniques.

"After months of testing, we found that the quality of Australian beef is equally excellent, and customers are very satisfied," Pellette said.

It should be noted that in terms of China’s import volume of beef, neither American nor Australian beef are major players. Customs data shows that in 2023, China cumulatively imported 2.7374 million tons of beef, an increase of 1.77%. In terms of import sources, the six main sources of China’s imported beef market are Brazil (43%), Argentina (19.25%), Uruguay (10.03%), Australia (8.27%), New Zealand (7.53%), and the United States (5.7%).

Aside from Australia filling the gap left by American beef, Carlos Favaro, Minister of Agriculture and Livestock of Brazil, recently stated that Brazil intends to "put itself forward" to China, aiming to become an alternative supplier to meet China’s beef demand.

Favaro pointed out that against the backdrop of the ongoing escalation of the tariff war between the two countries, the Chinese government decided not to restore the export qualifications of American meat processing plants to China, creating a "chance" for Brazil to further consolidate its position as a global protein supplier.

Currently, while there are many alternative solutions for American-style restaurants in China, Chinese restaurant owners are facing difficulties.

Previous reports by The Washington Post pointed out that Chinese restaurant owners are caught between a rock and a hard place: their signature dishes heavily rely on specialty ingredients that can only be imported from China, and faced with exorbitant tariffs, Chinese restaurants have few options other than streamlining their menus, raising prices, or replacing ingredients to survive in increasingly slim profit margins.

In the view of seasoned professionals in the foodservice industry, Chinese restaurant owners in the U.S. are now like the fillings in a sandwich, squeezed between rising costs at the supply end and customer expectations for dish quality.

This article is an exclusive piece by the Observer Network and cannot be reprinted without permission.

Original Source: https://www.toutiao.com/article/7495724444099428903/

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