Hatfield Exports Babcock Pork to Japan

Japanese are big on pigs from Penna., Business section, The Philadelphia Inquirer, Philadelphia, Pennsylvania, Friday, December 5, 1997

By Ralph Vigoda
INQUIRER STAFF WRITER

In Tokyo, Ridge helped push more pork, especially the Babcock breed, which brings home the bacon for Hatfield Quality Meats.

Just a few days ago, they were warm, fat little pigs, treated lovingly, given a special diet, and living on farms in Lancaster, Berks, and Franklin Counties.

Today, they’re cold, packaged pork chops, ready to begin a three week trek from Pennsylvania to Japan.

Every week, 80,000 pounds of chilled pork leaves the loading platform of Hatfield Quality Meats in Hatfield, Montgomery County. The product is trucked to Oakland, Calif., loaded on ships, and sent to Japan, where pork is the meat of choice, and there’s not enough of it home-grown to satisfy Japanese tastes.

Hatfield began shipping pork to Japan about 2½ years age, said Jake Clemmer, the company’s director of international sales. Exports have quadrupled since then, he said.

Yesterday, in an attempt to expand that market, Gov. Ridge was in Tokyo with Hatfield chief Phil Clemens and Jerry Hostetter, whose Lancaster County company oversees eight farms that raise hogs destined to wind up in Hatfield packages. The trio put on a pig-and-pony show for Japanese consumers in a supermarket, touting the excellence of Pennsylvania pork. The event was part of a nine-day trade mission to Asia with representatives of about 30 Pennsylvania companies.

While Ridge was sampling the wares, back in Montgomery County another shipment was being readied. The hogs are slaughtered and processed on Mondays and Wednesdays, and loaded into refrigerated containers on Thursdays and Fridays. They’ll be in Japanese supermarkets by Christmas Day.

It is a niche that can prove lucrative for the local company, which celebrated its 100th anniversary in 1995.

“We were up and down the East Coast, but a couple of years ago we decided we are competing in a world market,” said Clemmer. “We had been dabbling in the international market and we decided to get aggressive.”

Winning over the Japanese, however, is not done overnight. It requires considerable upfront effort, and the start-up costs can be significant.

“It is a big investment to develop these relationships,” said Ronald L. Plain, a professor of agriculture economics at the University of Missouri who studies overseas markets. “But there’s enormous potential payoffs. The Japanese tend to like long-term relationships. They’re not in-and-out buyers.”

They’re also picky about what they buy. Plain says the Japanese are willing to pay premium prices for the best cuts of pork. And they don’t accept just any pig. For its Japanese market, Hatfield uses a breed of hog known as Babcock.

“Not all hams are alike,” Plain said. “The Japanese like extremely lean pork cuts. And they like darker colored pork.”

With Babcock, they get both, he added.

“They are very, very specific as far as color and trim,” Clemmer added. “Our controls are very tight on their production.”

Also, Clemmer said, chilling, rather than freezing the pork leaves it with a fresher taste; freezing can cause some deterioration.

Periodically, Japanese inspectors arrive in Hatfield to eyeball production, Clemmer said.

“We open up the plant to them, take them out to the farms, let them see the control-feeding program,” said Clemmer. “We show them everything.”

The business of exporting meat to Japan is relatively new, said Bryant Wadsworth of the U.S. Meat Export Federation, based in Denver. High tariffs have made the Japanese market unattractive. And while international trade agreements of the last few years have made meat exports easier and cheaper, there are still enough restrictions to keep American companies somewhat at bay.

“If you removed the restrictions, we’d double or triple our pork to Japan,” said Plain, who noted that 3 percent of pork produced in America went to that country.

“It’s a tough business,” Wadsworth said. “The profit margins are usually higher, but so are the risks. If a company like Hatfield is successful, it speaks well of their determination, management, and aggressiveness.”

Of the 5,000 meat-processing plants in the United States, fewer than 200 are sending their products out of the country, Wadsworth said.

Japan has had a noticeable decrease in pork production, largely because farms have been gobbled up for development, experts say. And as the population has become wealthier, the demand for pork, which can cost three times as much as in the United States, has risen dramatically.

That’s why a firm such as Hatfield can step in. And Japan is not its only international market. Hatfield products are also sold in South Korea, Hong Kong, Russia and Mexico, with more countries being explored.

“We’ll be looking for other opportunities,” said Clemmer.