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  • (suspenseful music)

  • - [Narrator] This is a premium Wagyu steak from Japan,

  • and costs around $100 at supermarkets in the US.

  • And this is also Wagyu, but it costs $40.

  • (upbeat music)

  • That's because it comes from here,

  • the vast country of Australia,

  • where ranchers are racing ahead to win the global market

  • for Wagyu by experimenting with different methods

  • to raise the cattle.

  • - We're running about 2000 Wagyu cattle,

  • the Wagyus have been the linchpin

  • for our growth as a business.

  • - [Narrator] All this doesn't sit well

  • with Japanese farmers.

  • (speaks in foreign language)

  • Japan and Australia are the biggest Wagyu producers

  • in the world.

  • And they're vying for the largest export market

  • that is in US.

  • By 2023, the global Wagyu industry will generate sales

  • of around $9.5 billion,

  • according to the marker research from Technavio.

  • So Australian and Japanese farmers

  • are in an intense competition

  • with one country betting on tradition.

  • (speaks in foreign language)

  • While the other is betting on new technology

  • to increase productivity.

  • - We are mapping the entire genome,

  • I'll know whether to breed on from it,

  • or it's gonna end up on a dinner plate.

  • So this is really powerful technology

  • and we're using it to full effect.

  • - [Narrator] Wagyu is a breed of cattle native to Japan,

  • and literally translates into Japanese beef.

  • What makes it so special is the high concentration of fat

  • that's inside the muscles.

  • The industry calls it marbling.

  • And that's what farmer Kazuki Morimoto does best.

  • (speaks in foreign language)

  • He says the trick to his success

  • has been following strict traditions.

  • (speaks in foreign language)

  • Wagyu farms are usually small, but Morimoto's 300 cows

  • have brought in $1.4 million annually in the past few years.

  • A small herd allows them to pay very close attention

  • to the feed, which accounts for almost 70% of his costs.

  • (speaks in foreign language)

  • Morimoto usually fattens cows for a minimum

  • of two-and-a-half years,

  • compared to the average one-and-a-half years it takes

  • for other types of cattle like Angus.

  • He says his Wagyu is meant to be consumed

  • in small quantities, similar to other high-end delicacies

  • like caviar and Foie gras.

  • (speaks in foreign language)

  • (birds chirping)

  • Many Australian ranchers see the Japanese way

  • of raising Wagyu as out-of-date.

  • - As the Japanese, they're feeding the animals

  • basically from birth.

  • They just feed feed feed.

  • And we're not doing that.

  • - [Narrator] Steve Binnie is part

  • of a new generation of Wagyu ranchers,

  • who want to produce beef in what he says is the modern way.

  • He had his first Wagyu steak five years ago.

  • - Some people say, "Where were you when,

  • "you know September 11 happened?

  • "Where were you when Kennedy got shot?"

  • And so I look at this moment in my life

  • was when I had that first Wagyu, and it was so incredible.

  • - [Narrator] The next day, Binnie pivoted

  • his nearly 100-year-old family business

  • from Hereford cattle to Wagyu.

  • - So this is an eight to nine strip line.

  • Beautiful, this is what we'll be having for lunch.

  • The Australian product does cost less

  • because we're more efficient.

  • We're doing it on large-scale with low cost of production.

  • - [Narrator] Australian ranchers have perfected a technology

  • that Japanese farmers like Morimoto

  • won't ever consider using.

  • Agricultural genomics, it's the analysis and selection

  • of the best DNA in Wagyu cattle.

  • Then he has been artificially inseminating his cows

  • since he started raising Wagyu.

  • For this cow, he's carefully selected sperm

  • so that the resulting calf

  • will thrive in the hot Australian climate,

  • need less water and food compared to a cow in Japan,

  • but still grow up to become Wagyu that's rich in fat.

  • - It's a very data-driven process.

  • All of the carcasses that are coming through the abattoir,

  • they are evaluated for a matter of marbling,

  • weight, age, days on feed, all of this data

  • is going into this monstrous database

  • and all of these carcasses are being linked back

  • to the genetics.

  • - [Narrator] Using this, Australian ranchers

  • also create cross-breeds with other cows like Angus,

  • these steaks usually have less marbling

  • because they're genetically 50% Wagyu.

  • So about half the price of full-blood Wagyu steaks.

  • (steak sizzling)

  • Many of these cross-bred Wagyu steaks,

  • end up on plates in the US,

  • where local Wagyu production makes up a tiny portion

  • of the larger cattle industry.

  • By 2021, Binnie expects to increase the sales to the US

  • by up to 50%.

  • - So good.

  • - [Narrator] Wagyu embryos first arrived in Australia

  • in the early 1990s.

  • But the combination of genomics

  • and Australia's ability to scale cheaper Wagyu production

  • has led to a boom in demand,

  • helping the Australian industry grow

  • by 20% every year since 2015.

  • Last year, the country sold 40,000 tons

  • of Wagyu beef abroad,

  • making it the largest exporter of the steaks

  • on the planet by volume,

  • well ahead of Japan's export of just 4300 times.

  • (speaks in foreign language) (sound indicator beeping)

  • Farmers like Morimoto have been feeling

  • the market gets sucked away from them

  • by Australian ranchers.

  • So the Japanese government has stepped in

  • to protect and promote its Wagyu industry.

  • (speaks in foreign language) (sound indicator beeping)

  • Auction houses like this one are the only places

  • where Japanese farmers can sell their Wagyu beef.

  • For years, these places were not allowed to sell to the US,

  • a coveted market for Wagyu farmers.

  • The last year Japan signed a key trade deal with the US

  • to export unlimited Wagyu,

  • a key part of the Japanese government's grand strategy

  • to double beef exports.

  • (upbeat music)

  • The government also recently passed a bill

  • that criminalizes the export of Wagyu's semen and embryos.

  • (cameras clicking)

  • But experts say these reforms don't really get up the heart

  • of the issue with Japan's industry.

  • - It's a core deal, what Wagyu original beef

  • is a very excellent but price is too expensive.

  • - [Narrator] Takafumi Gotoh is an agronomist

  • who studies the Wagyu beef industry.

  • He says that in order for Japanese farmers to catch up,

  • they need to start copying

  • what Australian ranchers are doing;

  • produce Wagyu beef that's less rich in fat

  • and therefore cheaper.

  • - Australian farmers consider as a business.

  • But the Japanese farmers, the most important thing

  • is to produce a good marbling beef.

  • Japanese farmer should do a business,

  • consider the cost of performance, how much feed?

  • How much profit?

  • - [Narrator] But that won't be something Japanese ranchers

  • will accept easily.

  • (speaks in foreign language)

  • - This is an A4 Miyazaki ribeye from Japan.

  • And here we have a beautiful Australian ribeye.

(suspenseful music)

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The Battle Over Wagyu Beef | WSJ

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    joey joey posted on 2021/07/01
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