By Steve Suther
Director of Industry Information
Certified Angus Beef Program
You don't just sell cattle; you sell beef on the hoof. All right, you know that. But if you don't act like you know that with every management decision you make, you stand to lose money for yourself and every other beef producer in the country. Take a step beyond admitting that you sell beef: Be proud of it.
Many different kinds of cattle could live in those pastures and range areas, whether they are casual pets or your only means of making a living. You may have cows because of tradition, romance or business strategy, but it pays to remember they don't just produce calves. Think about the finished beef product and whether it will enhance consumer beef demand before you select breeds, cows and bulls.
Been there? Done that? Many past trends in cattle-type (later called "fads") were rooted in well-meaning attempts to give consumers what they said they wanted. The trouble was, consumers talked lean, lean, lean, but many did not put their money where their mouth was. Or rather, they tried it, found something missing and moved over to pork and poultry. The increasingly lean beef product offered for sale during the last quarter of the 20th Century was of variable tenderness, too often disappointing.
You've seen those depressing graphs with overall demand for beef sliding during those years. The 10-year cattle cycle continued, but each cycle bounced in a lower inventory range. Some pundits called it "a mature industry's death spiral." Perhaps you've seen the more upbeat graphs over the last year or so that show beef is back, led by a quality revolution. A healthy economy and improving product have helped beef regain its place at the center of more dinner plates.
What does it matter? Consider that the only new money that enters the beef industry comes in the form of consumer dollars. Without that, everyone else is just trading cattle dollars, which would continue to spiral on down. What turned it around? Producers just like you. The unified beef industry in its "Long Range Plan" launched a quest to be demand driven and consumer focused. The beef checkoff promoted beef while producers worked to improve it, brand it, make it more uniform, juicy and tender.
The only way to do that was to recognize your part on the beef industry team and look for opportunities to cooperate for mutual advantage. No longer could you consider your job finished the day your calves were sold. The key to your future as an independent producer became linked to that interdependent cooperation.
By century's end that teamwork had added as much as $500 million a year to producer income. Beef is back, but to keep it growing and rebuild the industry, producers must continue to improve consumer focus. Packers will send more accurate signals as they invest in case-ready products and demand specific high-quality, high-yielding cattle that fit those packages.
Better technologies to determine and even predict tenderness and marbling are being perfected. The leading branded programs are aiming for greater carcass utilization-selling more of each premium animal as branded product adds value that can be passed back to the producer. New value-added, microwavable beef products continue to roll out at an unprecedented rate to keep pace with today's time-strapped consumer.
The export trade has always been quality focused, and those opportunities have continued to expand. Internet sales of beef are growing at an even faster clip--again, quality, consistency and palatability are the leading specifications. Consumers don't like surprises when they order beef on a Web page anymore than the packer likes processing a poorly finished, low-grade carcass or the feeder likes nursing chronically sick or stunted calves.
Prospects for the beef industry have not looked this bright since the mid-1970s, and if every partner in every formerly isolated segment learns from the past, the darkest days are over. The beef industry can soar in this century in an expanding, upward spiral that offers rewards for everyone along the chain.
Next time we'll take a look at cutting costs and planning profits. Questions or comments? Call toll-free 877-241-0717.