TOKYO, Dec. 7 – Japanese retail giant AEON Co. announced on Dec. 6 it will cut prices of Australian beef by a maximum of 20 percent starting Dec. 7, ahead of the enforcement of the 11-nation Trans-Pacific Partnership free trade agreement on Dec. 30.
The move, which is likely to be followed by other retail firms, indicates a trend toward cutting prices of imported products along with the expected declines in tariff rates after the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, also known as TPP-11, comes into effect.
AEON will sell its private label Australian beefsteaks at 518 yen per 100 grams, down 20 percent for sirloin and down 4 percent for rib. The two meat products, mainly procured in chilled form, occupy 20 percent of the firm’s beef sales.
They will be sold at 400 stores in the Honshu and Shikoku regions. Presales were conducted on Dec. 6 at a store in Tokyo’s Meguro Ward, attracting attention of customers.
A tariff rate for Australian chilled beef will be reduced from 29.3 percent to 27.5 percent in the year the accord takes effect. The company aims to spur demand by carrying out significant price cuts in advance, before Christmas and the year end when demand for beefsteaks rise.
The price cuts will be conducted until the end of February, taking into consideration currency fluctuations. The firm plans to cut prices for other products such as fruits in January, after the TPP-11 pact is put into force.
In April, the pact will enter its second year and beef tariff rates will drop further. “We will consider how to reflect it to retail prices while taking into account other factors such as foreign exchange rates and costs,” said an AEON official in charge of livestock products.