2014 was a year of profound change in the U.S. beef industry. The long-term effects of a significant drought that began in the Southern U.S. in 2010, moved to the Midwest, and settled in the West were revealed in 2014. A severe cull occurred in the beef herd. The U.S. now has the lowest number of beef cows since 1951. Texas lost 24% of its total beef herd from 2010 – 2014 and Oklahoma lost 13%.
Although the drought is severe in the Western U.S., the rest of the country has seen some moderation. The result is that more heifers and cows currently are being retained as pastures and feedstuffs once again become available. This has caused a decline in the beef supply with a consequent increase in price. For example, 2014 boxed beef and fed cattle prices average 25% higher than in 2013 and feeder calf prices went up 45% for the year. Heifer slaughter is down 8% in 2014 and beef cow slaughter is down 18%. Beef production dropped more than 5% from 2013 levels. Retail beef prices increased 10% last year. Fortunately, beef demand in the U.S. has actually increased 4% over the past year.
One of the immediate changes to compensate for lower numbers has been a sharp increase in carcass weights during the last quarter of 2014 of almost 10kg, resulting in larger meat cuts. This creates challenges to marketing and merchandising beef.
Ongoing programs over the past few years have sought to ensure the quality of U.S. beef on every level of production, from breeding, feeding and meat cutting. Exports add almost $300 in value for every head produced. With increasing prices the value of quality could not be more important.
Producer Actions
In the U.S., purebred seedstock are used to produce crossbred cattle for commercial beef production. The attention that purebred breeders give to genetic selection, then, flows through the system and impacts the final product. There is growing interest in use of Across-Breed EPD’s. Marker-Assisted or Genomic-Enhanced EPD’s are a reality. Forward-thinking producers work with economic indexes for sire selection. This focus on economically-important traits continues to improve the U.S. cow herd. Attention to marbling and eating quality is growing in these systems.
U.S. Quality and Yield Grades
When cattle are finished on a high-corn diet for about 100 days, they are marketed to slaughterhouses. To a large extent, value is determined by the weight of the animal and the USDA Quality and Yield grades. As most of our cattle are young, the predominant factor influencing quality grade is marbling. The value of producing sufficient marbling for the U.S. and export market has profoundly influenced genetic selection. Consequently, a growing percentage of U.S. beef meets the marbling requirements for USDA Prime and USDA Choice grades. Similarly, genetic selection pressure has reduced the amount of external (subcutaneous) fat on the carcasses, resulting in leaner carcasses with lower numeric yield grades. Thus, the marketing system provides incentives to produce lean carcasses with high marbling. The collective result is a more desirable product for our consumers.
Beef Quality Assurance
For commercial producers along the beef production chain, an important national program is BQA – Beef Quality Assurance. This is an educational and certification program focused on beef production practices that impact the quality, wholesomeness and safety of beef. Modules include Animal Care and Husbandry Practices, Feedstuffs, Feed Additives and Medications, Processing/Treatment and Records, and Injectable Animal Health Products. Individual states implement the BQA program, certifying producers. Feeders and packers prefer animals from operators that have BQA certification because it helps to minimize defects and increases the likelihood of high-quality beef.
Meat Industry Changes
Beef producers contribute to a research and promotion program called the Beef Checkoff. Every time ownership of an animal changes, sellers pay one dollar per head to the national Beef Checkoff program. The checkoff is a federal program run by cattle producers (the Beef Board). Funds are used to support advertising and promotion of beef products both domestically and globally. Research projects are focused on beef quality and safety. The most recent assessment reveals a payback of 11:1 for checkoff funds to the beef industry.
An on-going project has been muscle profiling research conducted by the University of Nebraska and the University of Florida. This project evaluated over 5,500 muscle samples derived from the chucks (shoulders) and rounds of over 140 cattle. The goals of the research were to add value to muscles from the chuck and round and to create a database of traits from each of the muscles.
The outcome of the project was identification of a number of meat cuts from the shoulder clod that were undervalued. New cuts include flat iron steaks, petite tenders and ranch steaks. A second phase of the research investigated the muscles of the chuck roll. New cuts included the Denver cut, Sierra cut, Delmonico steaks, boneless country-style short ribs and America’s beef roast. Further work with the round helped to identify additional options to upgrade the value.
Retail Initiatives
This muscle profiling initiative created the impetus for the industry to reexamine how beef is cut and merchandised. Increasing carcass weights have created significant challenges to traditional beef cuts. Consumers desiring to buy an 8-ounce (c. 225 g) steak from the loin are likely to encounter a cut that is very thin (about ½inch; or 1.2 cm). These cuts are difficult to cook to a specific degree of doneness. An alternative retail cutting method, called BAM (for Beef Alternative Merchandising) has been developed by the National Cattlemen’s Beef Association. This method encourages meat cutters to make cuts smaller in diameter and thus greater in thickness. Together with muscle profiling, which encourages single-muscle merchandising over multi-muscle cuts, these two initiatives help to meet consumer needs and maintain customer satisfaction. An added is an increase in total beef sales for those supermarkets implementing the BAM cutting technique.
Marketing Claims
Generally, meat from U.S. beef is exceptionally tender. Like any country, however, there is some variation in this trait. A small percentage of U.S. beef does not meet consumer expectations for tenderness. Studies have repeatedly shown that consumers are willing to pay a premium for beef that is guaranteed tender. The U.S. Department of Agriculture has established rules to address marketing claims for tenderness on beef labels. Selected cuts from carcasses with a ribeye proven to be tender are eligible for a USDA Certified Tender or USDA Certified Very Tender label. Only muscles documented to be equal or superior to the ribeye in tenderness can carry this label. In this way, consumers are assured that beef labeled USDA Certified Tender meets the minimum standard for tenderness.
From this sampling of programs and initiatives in the U.S. beef industry it should be clear that there is a great deal of attention paid to eating quality. At virtually every step from production to consumption, industry segments are proactively taking steps to build quality into our beef products. Our performance on this important issue is largely why consumers continue to increase their demand for beef, even while the price is increasing. The importance of quality to domestic and international customers helps to ensure the U.S. beef industry does not lose focus on this critical feature of our beef.