Thanks, but no flanks

TOKYO – It’s been weeks since Japan ditched its import ban on U.S. beef and the first shipment went on sale, but American beef is nowhere to be seen in supermarkets here – except this nation’s five Costco stores.

Many Japanese are worried about the safety of U.S. beef. Retailers here say they aren’t about to waste their time carrying an unpopular product. Instead, meat-section shelves are filled with beef from Australia and Japan.

Japan once was the top destination for U.S. beef, importing $1.4 billion worth a year. But that was before Tokyo’s decision in December 2003 to ban American beef imports after the first case of mad cow disease in the United States.

The U.S. government repeatedly has said U.S. beef is safe because of stringent checks. But such assurances have done little to allay the fears of Japanese consumers about mad cow disease, or bovine spongiform encephalopathy, a degenerative nerve disease in cattle.

Eating contaminated meat products has been linked to the rare but fatal human variant Creutzfeldt-Jakob disease in more than 150 deaths. The outbreak, mostly in Britain, peaked in the 1990s.

“It’s scary – all this talk about mad cow disease,” said housewife Kimie Suzuki, who eats mostly fish but sticks with Japanese beef when she eats meat. “I’ve had foreign beef before, but it tastes different.”

Fears of Japanese like Suzuki have grown – not diminished – in recent months.

The ban on American beef was eased in December 2005, but it was imposed again in January after prohibited spinal bones were found in a veal shipment – an error by U.S. plant workers and a government inspector. That error was critical, making consumers even more suspicious about the safety of U.S. meat.

Kaori Watanabe, spokeswoman for Aeon Co., says the nation’s top supermarket chain hasn’t received a single call from customers asking for American beef. Aeon, which operates more than 300 food stores across Japan, often is deluged with requests for products, so that means there’s no interest in American beef, she said.

“We decided against it until there’s a situation in which customers can buy it without worrying about it,” said Watanabe.

Even Seiyu Ltd., the Japan unit of U.S. retail giant Wal-Mart Stores Inc., which runs more than 200 stores nationwide, isn’t selling American beef.

A survey by Tokyo-based marketing researcher Intage earlier this month found that 54 percent of the respondents said they wouldn’t buy American beef. A similar survey in December 2005 found 45.4 percent or respondents said they wouldn’t buy U.S. beef.

Japanese tend to be suspicious about their own government, and some think the government caved into political pressures from Washington, Japan’s No. 1 ally, to let in a possibly tainted product.

American beef at about $11.70 a pound is a fraction of the cost of Japanese beef, which can cost 10 times that, because of higher labor costs in Japan and the economies of scale at American farms.

Australian beef competes well in pricing against American beef at about the same prices. The Australian cattle industry has jumped right into the opportunity presented by the stumbling of U.S. beef exporters.

The industry is aggressively promoting the safety of Australian beef, noting that Australia has never had a case of mad cow. Australian cattle ranches have switched to feeding cows grain, instead of grass, to appeal to the Japanese palate for fat-laced meat.

Costco Wholesale Japan Inc., a unit of U.S. warehouse retailer Costco Wholesale Corp., is one exception in pushing American beef.

But Costco appeals to the well-traveled Japanese who buy in bulk – a minority for an island nation more accustomed to small homes and frequent shopping. Still, Costco’s entire 5.1-ton first shipment of U.S. beef sold out within about 24 hours. Another batch went on sale a week later and is selling well, Costco said.

“The response and demand for U.S. beef has been overwhelmingly strong,” Costco Wholesale Vice President Mike Sinegal said.

The Japanese government has generally taken a hands-off approach, although it has organized meetings to answer consumer questions about the scrapping of the ban.

“It’s not our job to promote American beef,” said Health Ministry official Koji Obayashi. “It’s OK if no one buys U.S. beef.”