"Mega Ball" A Meaty Competitor in Taiwan

He's a cute, friendly little guy. Almost looks like something you'd want to take home to the kids as a toy. But Mega Ball is no toy. In fact, it's an important new tool in the U.S. Meat Export Federation strategic plan aimed at expanding sales of U.S. beef and pork in Taiwan.

One of the major strategic objectives of USMEF's beef marketing program in Taiwan has been to increase distribution channels beyond the western hotel, steakhouse, and supermarket sector. The hotel sector still remains the leading source of import demand, but as product awareness among the local trade has grown so has the development of markets for U.S. beef in the retail and foodservice sectors.

Throughout most of the 1990s, USMEF's strategy at the retail level focused on expanding the U.S. presence in the island's growing supermarket sector. Utilizing a mix of marketing tactics including trade and retail teams, seminars, the development and dissemination of Chinese-language merchandizing manuals, and in-store promotions, the number of supermarkets carrying U.S. beef increased from 45 in 1993 to more than 730 outlets in 1999.

By the late 1990s, however, the explosive growth in supermarket expansion had slowed. And despite predictions that traditional meat retailing channels, called wet-markets, would lose out to supermarkets, USMEF consumer research in 1999 found that 75% of consumers, regardless of income levels, still shopped for beef in these markets. In addition, the Taiwan government helped upgrade the wet market infrastructure (by installing air-conditioning, improving lighting, etc.) in an effort to help operators compete with supermarkets.

With wet-markets alive and doing very well, the challenge for USMEF staff was to stimulate the development and introduction of lower cost U.S. beef items including some that were vacuum-packaged that could be used in traditional dishes. And, they needed a lead item that would appeal to established tastes and consumption conventions while helping them sell U.S. product.

Enter Mega Ball a fabricated and precooked U.S. beef item that could be used in popular and traditional Chinese hot pot dishes and soup. Fabricated from chuck flap and top blade muscle and bound together with wheat gluten, Mega Ball was introduced in 21 wet market booths and seven supermarkets in January 2000. Sold as a high-end and safe, meatball, the product quickly attracted the interest of consumers who have consumed meat and fish balls as staples in soups and stews. The packaged item is sold and labeled as a healthy and safe item fabricated entirely out of U.S. beef.

More than 40,000 pounds of Mega Balls were sold during that introductory month, with a value of more than $121,200. By December, however, Mega Balls were available in 105 wet market stalls and 95 supermarkets, and volume had increased to more than 216,000 pounds, with a value of $642,000. More than $5 million in sales were generated during 2000 by the Mega Ball product during its first year of sales.

As projected in the USMEF strategy, interest in the Mega Ball also generated interest in other U.S. beef products. By the end of 2000, more than 65 wet market booths had added new U.S. beef items, including heel muscle, boneless chuck short rib, bone-in short ribs, rib fingers, shank, top blade muscle, short plate and variety meats such as tendon and tripe.

The sales of beef and beef variety meats to Taiwan increased 51 percent in 2000, to more than 20,000 metric tons, partly as a result of the successful Mega Ball. During the first quarter of 2001, Mega Ball sales continued to grow on a seasonal basis, even though total beef export sales were not as strong. USMEF reports that a strong dollar, high U.S. beef prices and the lingering impact on meat consumption resulting from concerns about foot-and-mouth disease (FMD) and bovine spongiform ensepolophathy (BSE) impacted first quarter U.S. beef export sales in Taiwan and the rest of the world.

Success of the beef Mega Ball has now led to the introduction of a pork version that was introduced to Taiwanese consumers in May. Fabricated from picnics and butts and bound with wheat gluten, USMEF expects the pork Mega Ball to ride the wave of success the beef ball has had. Although pork is a staple in the Taiwanese diet, U.S. sales to the island in 2000 were down 25 percent, to about 26,000 metric tons, as the result of an increase in domestic pork production. The pork Mega Ball, like that of the beef ball, is designed to help U.S. suppliers escape the commodity market mentality, where price dictates the country of origin.

In 2000, according to newly revised USDA statistics, total U.S. beef exports grew by 12 percent in volume to more than 1.24 million metric tons, while value grew 13 percent to $3.6 billion. Pork exports grew 12 percent in volume to more than 568,000 metric tons, while value grew 18 percent to $1.3 billion. Exports now account for nearly 13 percent of U.S. beef production and more than 8 percent of U.S. pork production on a wholesale weight basis. These exports also benefited U.S. grain and soybean producers'. It required 305.6 million bushels of feed grains and 32.9 million bushels of soybeans to produce the U.S. red meat exported in 2000.

The U.S. Meat Export Federation is the trade association responsible for developing international markets for the U.S. red meat industry and is funded by USDA, exporting companies, and the beef, pork, corn, sorghum and soybean checkoff programs.