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Beef Producers Could Learn from Chicken Farmers

August 8, 2011

In two decades, poultry producers increased consumer consumption of chickens by 40 pounds per capita. In the same era, 1980 to 2001, beef consumption slipped slowly away.

“It’s difficult to determine why consumers change,” says Scott Brown, meat economist at the University of Missouri. “But one thing is clear: Chicken producers were providing what consumers wanted.”
 
Brown believes beef producers can take a page from the poultry playbook and boost beef demand.
 
“There has been much research into why demand for beef weakened,” Brown says. “Basically, consumers say they prefer tender, flavorful beef--every time. That’s not what they were getting.”
 
Brown believes beef producers can compete at the meat case by changing breeding, management and marketing.
 
The chicken rise and beef decline came at a time when poultry producers could quickly change their flocks. At the time, beef producers did not have tools to reach the genetic potential of beef cattle.
 
In the era of rising poultry demand, consumers were looking for a healthy product in the meat case. Beef found it difficult to compete, Brown says.
 
Then consumer desires changed. “The Atkins diet and strong growth in midlevel restaurants drove beef demand higher.”
 
Now, the recession changed consumer demand again. With less money in their pockets, consumers downsized from steaks to hamburger.
 
However, in a surprise for meat marketers, consumers started buying, and paying more, for Choice- and Prime-grade steaks. Mainly, these were not eaten at white-tablecloth restaurants but grilled at home.
 
“From this point forward, there seems to be a role for high-quality beef,” Brown says. “This can increase overall demand for beef.”
 
That change in demand rides on producing the tenderness and flavor of high-quality cuts, Brown adds.
 
This upscaling occurs in domestic markets, but especially in the export trade. A growing beef trade to Japan and South Korea shows the way.
 
“Both of these markets tend to import high-quality beef products,” Brown says. “It appears further recovery is in sight.
 
“Demand strength for beef depends on the levels of both consumption and price,” he says. “Looking at consumer buying in the recession shows that in certain sectors, demand deterioration for higher-priced products did not occur.”
 
Brown researched databases on sales by Certified Angus Beef (CAB). “Despite the economic downturn, CAB products experienced expansion.” They sell upper Choice- and Prime-grade meat.
 
“The potential for marketing premium product is vast,” Brown says. “However, it will require coordination and commitment that have been elusive in the cattle industry.”
 
Shifting to meet consumer demand has been illustrated by the chicken industry over a long period, Brown says.
 
Studies of the beef marketing show that the higher the quality of the beef, the larger the premium increases.
 
“The market already rewards producers of Prime beef with grid premiums,” Brown adds. “As the economy recovers, producers supplying high-quality beef will be the biggest winners in this new demand environment.”
 
The signal for more premium beef comes at a time of giant advances in beef breeding protocols using superior genetics through fixed-time artificial insemination.
 
Steers from the MU Thompson Farm fed at an Irsik and Doll feed yard over the past three years have graded 27% USDA Prime. For comparison, less than 4% of U.S. cattle grade Prime, Brown says.
 
Chicken producers made rapid changes in genetics to meet demand. Now, beef producers have tools to speed the genetic progress in their herds.
 
Brown cautioned that there is much more than artificial insemination involved. The whole management package includes health, nutrition, genetics and more.
 

 

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RELATED TOPICS: Beef, Poultry, Livestock, Cattle, Feedyard

 
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COMMENTS (2 Comments)

GLEN - RED LODGE, MT
Hmmmmm! I agree with this to a point. However for the last 20 years I have been eating chicken from Costco. They have the integrated system of chicken. The last five years their quality, tenderness and taste have been very uneven; so much so that I quit buying chicken from them. I do not think the beef industry can handle a system this integrated and still be profitable. It is easier to change the chicken stream very fast as the process is very intensively managed on both the input and output sides. I raise cattle, fatten cattle and sell meat. All of my meat customers rave about the quality and taste of the product. Five years ago I was getting so so comments and negative comments, because the processing plant I was using was not maintaining the quality controls I was told they had in place. I feed my cattle longer, do not worry about age of animal at time of slaughter, someone lives with the cattle at calving season, cattle are handled like pets and will follow a bucket anywhere, will load on semis with out prodding,etc. I sell my meat for way above market price due to quality. My buyers can afford the higher price, or make saving enough money a priority to consume my product. I do feed animals of other farmers for their own consumption, as they like the taste of the finished product. Accomplishing this on the industry picture where you have to get big or get out is a hard row to hoe. We have no room for poor management, cowboying cattle, poor feed supplies, owning cattle to say you own them, poor feeding and feedlot practices, unknow genetic qualities, mass production slaughtering plants, and no care for the effect of temperment on tenderness to get consistent quality meat. For the system to work many areas of the country will have to quit raising cattle due to either heat or cold at the extremes. I beleive eventually the packers will make us use the chicken system, and the consumer will just have to get used to consistently poor quality of beef,
1:43 PM Aug 8th
 
GLEN - RED LODGE, MT
Hmmmmm! I agree with this to a point. However for the last 20 years I have been eating chicken from Costco. They have the integrated system of chicken. The last five years their quality, tenderness and taste have been very uneven; so much so that I quit buying chicken from them. I do not think the beef industry can handle a system this integrated and still be profitable. It is easier to change the chicken stream very fast as the process is very intensively managed on both the input and output sides. I raise cattle, fatten cattle and sell meat. All of my meat customers rave about the quality and taste of the product. Five years ago I was getting so so comments and negative comments, because the processing plant I was using was not maintaining the quality controls I was told they had in place. I feed my cattle longer, do not worry about age of animal at time of slaughter, someone lives with the cattle at calving season, cattle are handled like pets and will follow a bucket anywhere, will load on semis with out prodding,etc. I sell my meat for way above market price due to quality. My buyers can afford the higher price, or make saving enough money a priority to consume my product. I do feed animals of other farmers for their own consumption, as they like the taste of the finished product. Accomplishing this on the industry picture where you have to get big or get out is a hard row to hoe. We have no room for poor management, cowboying cattle, poor feed supplies, owning cattle to say you own them, poor feeding and feedlot practices, unknow genetic qualities, mass production slaughtering plants, and no care for the effect of temperment on tenderness to get consistent quality meat. For the system to work many areas of the country will have to quit raising cattle due to either heat or cold at the extremes. I beleive eventually the packers will make us use the chicken system, and the consumer will just have to get used to consistently poor quality of beef,
1:43 PM Aug 8th
 



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