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Beef and biotech in Beijing

Wagyu Bio-Tech Beijing has became the country's first company to rear a wagyu herd solely from imported embryos.
Last Modified: 26 Jan 2013 14:17
Although wagyu is considered a Japanese treasure, significant herds also exist elsewhere [David Green/Al Jazeera]

In the foothills north of Beijing, not far from the border with Hebei Province, China's first herd of wagyu beef cattle are being primed for slaughter.

The first cuts of the beef, which command astronomical prices the world over for its intense marbling and unparalleled taste, should hit the market this summer, a remarkable achievement given that five years ago the herd was little more than a twinkle in the eye of an Australia-born wagyu beef cow.

Though wagyu is considered a national Japanese living treasure, significant herds also exist elsewhere, a result of the export of live animals to the US in 1975, and the subsequent transfer of genetics to Australia.

Back in 2007, Wagyu Bio-Tech Beijing began the process of extending this chain to China, seeking to capitalise on a growing domestic appetite for high-quality beef by becoming the first company to rear a wagyu herd in the country solely from imported embryos and semen.

At the behest of his China-based business partners, company director Ian Chen, a vivacious 50-year-old Beijing native, reached out to the Australian Wagyu Association in a bid to arrange the export of a batch of full-blood Japanese Black wagyu embryos to his Chinese colleagues.

It was an ambitious plan, particularly given the timeframe involved: wagyu cattle are usually slaughtered between 24 and 30 months, meaning there would be significant lag before the team saw any return on their investment.

Yet, as Chen explained during the three-hour drive to the company's Beijing farm, he was happy to pursue the idea due to his faith in the deep-seated relationships between the company's major stakeholders.

One of those, Geng Shaowang, is the go-to cattle-breeding expert for many large Chinese dairy firms, including Mengniu Dairy. He would provide the technical knowhow to successfully inseminate and nurture the embryos once they had been verified as the real deal.

"Even then, we had no idea if what we were sending was the real thing," Chen tells me from the back seat of our car. "It was a gamble, but we were able to verify the DNA and trace the embryos all the way back to Japan."

Beef appetite in China 

The team took the risk against a backdrop of rising appetite for beef in China.

As incomes increase and tastes are refined, domestic production has been unable to keep pace with demand, leading to a surge in legal imports, as well as illegal shipments from countries such as Brazil, the US and Japan - imports that China attempts to block due, in part, to concerns over mad-cow disease.

"It's true, the older cattle are not so good because they weren't given the best feeding program, these should taste a lot better, you can see the feed program up here on the pens "

-  Ian Chen, Wagyu Bio-Tech Beijing

Moreover, at an average price of 48.34 CNY ($7.77) per kilo, beef prices in early 2013 are up more than 20 percent on the previous year, according to data from the ministry of agriculture.

These prices pale in comparison with those fetched for prime cuts of wagyu, however, which can reach nearly 1,000 CNY ($160) per kilo, putting the value of a full-grown cow on a par with a Chinese-made car.

Wagyu Bio-Tech now boasts some 700 head of cattle, split between a specialist breeding facility in Shandong Province and the Beijing farm. Their eventual aim is to maintain a herd of 2,000, with the majority of each cow's 30 CYN ($5) per day upkeep cost deferred to local dairy companies during the feeding process.

Purists will argue that, as they have not been raised in Japan, nor fattened up with beer and massaged with sake as wagyu lore attests is still the practice in Hyogo Prefecture, the herd on the Beijing farm does not truly make the wagyu grade.

"It's true, the older cattle are not so good because they weren't given the best feeding program," admits Chen.

"These should taste a lot better, you can see the feed program up here on the pens," he adds, referring to some of the younger herd, which have been fattened up on feed prepared by a US firm under instruction from the company's Japanese advisers.

Control over the product 

When I met them in their Beijing office, Wagyu Bio-Tech's principals were keen to stress that they see wagyu as a long-term investment - one of Chen's colleagues has sent his son to work on a wagyu farm in Australia to learn the ins and outs of the business - and that they stand apart from the hasty efforts of other Chinese firms trying to break into the market.

As they tell it, they have done their utmost to maintain their relationships with the Australian embryo suppliers, not least by following through on payment for their embryo orders, unlike one rival who reportedly left their supplier fuming after paying for just 400 of the 1,000 embryos they had ordered.

Yet the company is up against marked prejudice over food safety standards in China. At the time of writing, Yum! Brands, the parent of fast-food chain Kentucky Fried Chicken (KFC), was apologising to customers over mishandling a scare in which its suppliers' chickens were found to contain excessive amounts of anti-viral drugs.

Moreover, the 2008 melamine milk and baby formula scandal and other incidents have instilled a heavy scepticism in the minds of the Chinese public.

To counter expected doubts over how its meat is handled, part of Wagyu Bio-Tech's strategy may involve launching a joint venture with a Japanese restaurateur, ensuring that they can maintain control over their products all the way from test-tube embryo to steak on the plate.

It stands to reason, given the firm is yet to see any return on five years' commitment of time and money, that Wagyu Bio-Tech would not risk negating this investment by cutting corners. Whether the business succeeds or fails may in a large part depend on its ability to convince Chinese consumers that this is so.

 

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Source:
Al Jazeera
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