HK govt urged to beef up meat price competition

Hong Kong Secretary for Food and Health Ko Wing-man promised on Tuesday to review and investigate the monopoly in fresh beef imports, during a meeting with beef traders who complained that the existing monopoly has led to surges in fresh beef prices in Hong Kong.

According to the Fresh Beef Traders Alliance, the retail price for fresh beef in the city is about HK$196 ($25.29) per kilogram, 45.6 percent higher than the price in Shenzhen. By deduction for a live animal of about 300 kilograms, the price difference between Hong Kong and Shenzhen can be as high as HK$10,000.

Currently, all the live cattle and sheep imported to the city are managed exclusively by China Resources Ng Fung Limited, or CRNF. Since June, the company has increased the wholesale price for fresh beef five times. The latest increase dated back to the end of October, when the price climbed 31.45 percent higher than the July price.

Hui Wai-kin, chairman of the traders' alliance, said that even if some beef importers brought in live cattle to the city, the price would still need to be set by CRNF if the meat is sold in the local market.

In response to inquiries from China Daily, CRNF said the government has approached the company earlier to discuss the issue and it had already submitted the information to the government.

Earlier, the company issued a statement, saying the price hike was incurred by the growth of price on mainland cattle market and also to ensure the quality of cattle brought to the city.

Legislator Wong Kwok-hing from the Democratic Alliance for the Betterment and Progress of Hong Kong (DAB), who helps the traders, called the meeting with Ko "satisfactory", saying the government has shown a good deal of attention to the issue.

Wong said the government will research further to see if the city should open the fresh beef market, stressing the government has concern for the traders and for the public who have no choice other than the expensive fresh beef.

Back in 1970s and 1980s, about 500 to 600 live cattle were imported in the city every day. However, despite the growing population in Hong Kong, the number of live cattle imported is going down. In 2007, the average number of cattle imported per day was 130. At present, fewer than 70 live animals are brought to the city.

Wong suggested the possibility of importing live cattle from Southeast Asian countries, such as Malaysia and Indonesia, to create competition in the market, saying the price hike has driven away the grassroots who have lower incomes and that had led to a decline in demand.

In 2007, the government allowed two additional importers into the pork market. CRNF had been the sole importer of live pigs prior to 2007. The organization had its monopoly taken away, after the pork industry complained that the sole agency franchise had brought soaring wholesale prices for pork.

Hui appealed to the government to learn from the lesson and introduce more competition by allowing more importers in the market, saying the ever-increasing price of fresh beef has driven two beef retailers out of business in North Point.