LAMB%20MARKETING%20SYSTEM%20BASED%20ON%20CARCASS%20MERIT

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REPORT OF THE JUNE-SEPTEMBER 2005 NATIONAL BEEF
QUALITY AUDIT A NEW BENCHMARK FOR THE U.S. BEEF
INDUSTRY.
G.C. Smith, J.W. Savell, J.B. Morgan and T.E.
Lawrence Colorado State University, Texas AM
University, Oklahoma State University and West
Texas AM University Funded By Cattlemen's Beef
Promotion and Research Board Through The 1
per-head checkoff Conducted For National
Cattlemen's Beef Association
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"In truth, it is the value of our product to our
consumers that determines what beef is worth --
and our profitability. The NBQA provides valuable
information to industry stakeholders regarding
the monetary consequences of not truly delivering
the quality and value to our consumers." Terry
Stokes (NCBA)
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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"The forces shaping the beef industry in the
21st century are (a) Continued consolidation in
all beef sectors. (b) Loss of export
markets. (c) Greater competition from other
countries in the global markets. (d) Development
and implementation of traceability/data-management
systems. (e) Growth of markets for natural and
organic food products." J. Daryl Tatum (Colorado
State University)
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Concentration In The Food And Beef Industries
Market Share
Cow/calf producers Largest 9 51 Feedlot
operators Largest 2 85 Packing companies Top
5 78 Supermarket chains Top 10 55 Food-service
distributors Top 10 45 Restaurant chains Top
10 30
SOURCE CattleFAX (2005).
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"Beef in the U.S. is now being sold based upon
USDA grades, USDA brands, and industry brands
tremendous growth has occurred in the last ten
years in USDA certified brands and USDA process
verified brands, causing progressively greater
emphasis on verifying marketing claims and on
authenticity management for processes and
products."Cara Gerken (IMI Global) "Tracking
cattle from the ranch to the packer is essential
because export markets will require it, WalMart
and McDonald's want it, and producers can benefit
from it."John Paterson (Montana State
University)
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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"A Partnership For Quality (PFQ) can be formed
between a beef finishing/harvesting company and
progressive producers who are strongly focused on
the production of a consistent, high quality,
consumer-driven product, with the strictest
standards for food safety, environmental
stewardship, economic sustainability and animal
welfare." "A Partnership For Quality (PFQ) makes
possible PFQ Program Incentives for genetics,
vaccination, weaning, seasonality, natural
(hormone/antibiotic constraints) and carcass
characteristics." Mike Smith (Harris Ranch Beef)
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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"Involvement in alliances allows beef
supply-chain focus upon today's and tomorrow's
targets (a) A safe beef supply. (b) Electronic
IAID with age records. (c) Balance in production
performance and carcass merit. (d) Management
based upon individuals rather than on pen/lot
averages. (e) Avoidance of 'out cattle' (dark
cutters, advanced maturity, etc.). (f) Control of
carcass weight (target 600 to 949
lb). (g) Production of High Select or better, and
Yield Grade 2 or better, carcasses with ribeye
areas of 10.0 to 15.9 sq. in. (h) Adoption of
instrument grading. (i) Tenderness testing to
avoid tough beef." Glen Dolezal (Cargill Meat
Solutions)
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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"Major trends and opportunities in the U.S. beef
industry include (1) Globalization and, thus,
increased competition. (2) Retail and
foodservice consolidation. (3) Coordinated
production systems. (4) Increased product
branding and value differentiation. (5) Accelerat
ed development of new consumer-friendly and
convenience-orientated beef products." Randy
Blach (CattleFAX)
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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"The National Beef Quality Audits provide (a) A
snapshot of the industry's current quality
status, (b) A benchmarking tool for the
industry's quality improvement strategy, and (c)
A driver for the industry's Beef Quality
Assurance, Producer Education Programs." Ran
Smith (Chairman, BQA Advisory Board) "The
National Beef Quality Audits of 1991, 1995, 2000
have provided valuable industry benchmarks for
use by beef industry stakeholders, and identified
areas on which to place emphasis in local, state
and national BQA endeavors." G.C.Smith
(Colorado State University)
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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"Previous NBQAs have identified Strategies,
Tactics and Goals as vision directives for those
in the production sector who wish to be more
competitive and find marketing options -- now or
in the future, in domestic and international
venues." Tom Field (Colorado State
University) "A panel of industry professionals
assessed beef industry progress in achieving the
12 'Goals' identified by the NBQA -- 2000.
Individually, grades as low as D-plus (develop
and implement electronic cattle identification)
and as high as B-plus (eliminate injection-site
lesions 100 of seedstock producers have genetic
data) were assigned. The overall average grade
for the beef industry was B-minus." Clint
Peck (Beef Magazine)
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Responses To Questionnaires -- Seedstock
Generators, Cow/Calf Producers,
Stockers/Backgrounders and Cattle Feeders
(Combined)
Greatest Quality Challenges Influence Of Past
NBQAs On Changes Made Since 1991
(1) Insufficient Marbling (2) Lack of
Uniformity (3) Inadequate Tenderness (4) Too High
Yield Grades (5 tie) Low Cutability (5 tie) Too
Heavy Carcasses (7) Injection-Site
Lesions (8) Inadequate Flavor (9) Inadequate
Muscling (10) Excess Fat Cover
26.5 Strong Impact 55.4 Moderate
Impact 18.1 Weak Impact
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Responses To Questionnaires -- Packers
Greatest Quality Challenges Influence Of Past
NBQAs On Changes Made Since 1991
(1) Reduced Quality Grade Tenderness Due To Use
Of Implants (2) Lack of Uniformity In Live
Cattle (3 tie) Too Heavy Carcasses (3 tie) Too
High Yield Grades (5 tie) Presence Of Bruises On
Carcasses (5) tie) Hide Damage Due To Hot-Iron
Brands
33.0 Strong Impact 67.0 Moderate Impact
0.0 Weak Impact
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Responses To Questionnaires -- Purveyors,
Restaurateurs And Supermarket Operators
Greatest Quality Challenges Influence Of Past
NBQAs On Changes Made Since 1991
(1) Insufficient Marbling (2) Too Heavy
Cuts (3) Lack Of Uniformity (4) Inadequate
Tenderness (5) Excess Fat Cover (6) Inadequate
Juiciness (7) Inadequate Flavor (8) Inadequate
Overall Palatability (9) Low Cutability (10) Too
Large Ribeyes
15.0 Strong Impact 85.0 Moderate Impact
0.0 Weak Impact
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Questionnaires Returned By Packers (A, Roeber and
B, Scanga, Results)
(A) Purchased harvest-cattle that were
individually identified 31.5 (A) Average
number of branded-beef programs
5.3Branded-beef programs having specifications
for breed (37),marbling (62), hide color
(48), Yield Grade (42) (B) Changes from 1995,
to 2005, inAverage number of branded-beef
programs 1.33, to 6.25Average number of Angus
programs 0.67, to 3.00Average number of
Natural/Grass-Fed programs 0.50, to 2.25Harvest
cattle purchased on a "grid" 15, to 34Harvest
cattle purchased "in the beef" 20, to 26Harvest
cattle purchased as "source verified" 0.4, to 1.
5Harvest cattle purchased as "age
verified" 0.0, to 1.0
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Use Of Food-Safety Interventions
Based on questionnaires returned by packers,
those using specific food- safety interventions
were Hide-on carcass washing 16.7 Steam
pasteurization of carcasses 16.7 Hot (gt165?F)
water carcass washing 66.7 Pre-evisceration
carcass washing 83.3 Steam vacuuming (spot
cleaning) of carcasses 100.0 Organic-acid
rinsing/washing of carcasses 100.0
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Questionnaires Returned By Packers (A, Roeber and
B, Scanga, Results)
(A) Carcasses weighing 600 to 1,000 lb.
92.1 (A) Carcasses grading Prime or Choice
66.2 (A) Carcasses of Yield Grades 1, 2 plus 3
86.5 (A) Calloused ribeye (0.3), dark cutter
(1.5), blood splash (1.7) occurrences. (B) Chang
es from 1995, to 2005, in Average hot carcass
weight 740, to 749 lbCarcasses grading
Prime 1.7, to 7.3Carcasses grading Upper
Two-Thirds Choice 21.7, to 27.9Carcasses
yield grading 1 2 51.3, to 47.1Carcasses
yield grading 4 5 7.6, to 11.5Carcasses of
"B" maturity 2.2, to 13.9
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Responses To Questionnaires -- Purveyors,
Restaurateurs And Supermarket Operators
Special Concerns/Desires Of Customers/Consumers
(1) E.coli O157H7 (7) Salmonella (2) Hormone
Residues (8) Listeria monocytogenes (3) Desire
For "Natural" Products (9) Desire For "Organic"
Products (4) Antibiotic Residues (10) Price (5) De
sire For Traceback (11) Concerns About The
Environment (6) Concerns About Animal
Welfare (12) Bovine Spongiform Encephalopathy
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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U.S. Meat Case Benchmark Study

• 68 of self-service meat case was as "fresh" meat
  items.
• Of fresh meat items, beef (29) ranked first
  (chicken, 16 pork, 14).
• Of fresh beef items, 43 was steaks, 30 was
  ground beef, 14 was roasts.
• Of fresh beef items, 1.5 of packages were
  "Natural" or "Organic."
• 82 of steak packages and 93 of roast packages
  were boneless.
• Ground beef is most often designated by leanness
  percentage (62), then by cut source (21).
• 3 of beef packages (vs. 14, 10 and 7 for
  chicken, pork and poultry) were "value added."
• 27 of beef was in case-ready packages (vs. 85,
  83 and 37 for turkey, chicken and pork).
• 46, 56 and 20 of steak, roast and ground beef
  SKUs were "out-of-stock" -- less often so if
  case-ready than store-wrapped.

SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Face-To-Face Interviews Of Six Government
Agencies (FSIS, AMS, GIPSA, FAS, APHIS, FDA/CVM)
And Eight Trade Organizations (AMI, USMEF, FMI,
NAMP, NRA, SMA, NMA, NCBA) -- "Quality
Defects/Challenges"
(1) Lack of Mandatory Traceability, ID System And
NAIS Compliance. (2 tie) Product
Inconsistency. (2 tie) Food Safety
Pathogens/EHEC/Salmonella/Listeria
monocytogenes. (4 tie) Bovine Spongiform
Encephalopathy. (4 tie) Growing Concern About
Humane Handling/Animal Welfare/Enviroment. (6
tie) Inadequate Tenderness/Palatability/USDA
Quality Grade. (6 tie) Appropriate SRM
Removal/Disposal and 4-D Animal Disposal. (8
tie) Growing Concern About Chemical Residues. (8
tie) Carcass/Cut Weights Too Heavy And
Inconsistent. (10 tie) Shelf-Life Lack Of
Age/Source Verified Cattle Growing Concern About
Antimicrobial Resistance Meat Color And pH
Variation In Ground Beef Susceptibility To FADs,
Agroterrorism and Bioterrorism.
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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USDA Data For Beef Carcasses Officially Graded
(Not All Of The Total Beef Carcass Population)
Change corrected for Officially
Graded Apparent Good/Select marketed1975
2004 change as "No Roll"
Prime 5 3 -2 -1 Choice 79 57.5 -21.5 -6.2
Good/Select 15 39 24 par Standard 0.7 0.4
-0.3 -0.3
YG1 2 10 8 (0.4 vs. 10 1973-1974 ) YG2 31
42 11 (26 vs. 42 consist ) YG3 64 41 -23
(43 vs. 41 vs. 2004 ) YG4 3 7 4 (21 vs. 7
officially ) YG5 0.2 0.3 0.1 (6 vs. 0.3 g
raded )
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Preliminary Data -- Assessments Of Cattle On
Harvest Floors (N16)
Brands none, 49.5 butt, 39.5 side, 13.8
shoulder, 2.6. Horns none, 76 Hide Color gt51
black, 56 red, 18 yellow, 5 Holstein, 9
grey, 5 white, 2 brown, 4 brindle,
1. Manure none, 20 small, 64 moderate, 16
large, 3 extreme, 0.1
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Preliminary Data -- Identification Methods Age
Approximations
Forms of identification on harvest cattle none,
11.3 electronic, 2.5 barcode, 0.5
individual visual, 33.5 lot tag, 62.4 metal
clip, 12.7 other, 3.3. Permanent incisors in
harvest cattle 0, 83.1 1, 5.5 2, 8.7 3,
0.6 4, 1.5 5, 0.1 6, 0.3 7, 0.03 and
8, 0.05. Overall maturity score of harvest
cattle A, 97 B, 2 C, 1. Of A maturity
carcasses Aoo to A40, 14.
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Update Carcasses Qualifying For Export To Japan

• As of January 9, 2006, and for the period
  December 12, 2005 through January 9, 2006,
  1,379,964 carcasses were presented to USDA for
  grading.
• 5.7 qualified for BEV-Japan via A40 overall
  maturity.
• 14.6 qualified for BEV-Japan via "Age
  Verification."

SOURCE Rick Jones (AMS-USDA).
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Preliminary Data -- Assessments Of
Carcasses/Offal On Harvest Floors (N16)
Condemnations Carcasses, 0 livers, 25 lungs,
11 tripe, 8 heads, 5 tongues, 9. Contained
a fetus 0.47 of all cattle. Primary causes
for livers, abscess, 54 lungs, pneumonia,
41 condemnation tripe, other causes, 44
heads, other causes, 68 tongues, inflamed lymph
nodes, 64. Offal condemned due livers, 0.3
lungs, 0.4 tripe, 0.8 heads, 3.2 to gt30
MOA tongues, 2.5. Bruises per carcass no,
64 1, 25 2, 8 3, 2 4, 0.5 5, 0.01. Of
bruises, by cut round, 10 loin, 36 rib, 21
chuck, 24 flank/plate/brisket, 9.
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Preliminary Data -- Assessments Of Carcasses In
Coolers (N16)
Genetic type native, 92.0 dairy, 7.2 Brahman
(gt4" hump), 0.8. Gender steer, 62.7 heifer,
37.3 bullock, 0.06. Marbling AB, zero MAB,
zero SAB, 2 MD, 5 MT, 14 SM, 37 SL, 37
TR, 2 PD, zero. Overall maturity A, 97 B,
2 C, 1 D, zero E, zero. Quality
Grade Prime, 2.9 U 2/3 C, 17.0 L 1/3 C,
36.2 Se, 38.5 St, 4.2 Com, 0.7 Ut,
0.5. Hot carcass weight lt601 lb, 2 601 to 950
lb, 93 950 lb, 5. Yield Grade 1, 15 2, 37
3, 33 4, 13 5, 2.
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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"Out Cattle" -- Packer Questionnaires
(Roeber/Scanga) Preliminary Cooler Data (N16)
Carcass weight less than 600 lb 5.3 ---- 2.0 Ca
rcass weight more than 1,000 lb. 3.0 ---- 1.1 Q
uality Grade less than Select 6.3 4.9 5.4 Yiel
d Grade worse than YG 3 13.5 11.5 15.0 Callous
ed ribeye 0.3 ---- ---- Dark cutter 1.5 ---- 2
.6 Blood splash 1.7 ---- 0.8 Yellow
fat ---- ---- 0.5 gt30 MOA ---- ---- 1.1
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Top Ten Quality Challenges (SW of NBQA -- 2005)
(1) Lack of traceability/IAID/source age
verification/chronological age (2) Low uniformity
of cattle, carcasses cuts (3) Need to implement
instrument grading (4) Inappropriate market
signals (5) Segmentation within and among
industry sectors (6) Too heavy carcasses
cuts (7) Too high Yield Grades (low
cutability) (8) Inappropriate ribeye
size (9) Reduced QG tenderness due to
implants (10) Insufficient marbling
SOURCE Deb Roeber (Oklahoma State University)
October 2005.
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What Is The Beef Industry Doing Well?
(1) Developing "story" beef. (2) Reducing E.coli
O157H7. (3) Merchandising "quick" (to prepare)
beef. (4) Merchandising new beef "value"
cuts. (5) Reducing excess fat cover, at the
end-user level. (6) Developing "brands" of
beef. (7) Increasing beef demand. (8) Making the
industry profitable.
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Industry Representatives Strategies, Tactics
Goals
Cow-calf producers Jeff Windett (Circle A
Ranches)John Edwards (Express Ranches) Stockers/B
ackgrounders Tom Woodward (Broseco
Ranches)Charles Nichols (Nichols Ranches) Cattle
feeders Mike Engler (Cactus Feeders)Tony Bryant
(Five Rivers Cattle Feeders) Beef packers Bruce
Bass (Tyson, Inc.)Rod Bowling (Smithfield Beef
Company) Beef end-users Paul Heinrich (Sysco,
Inc.)Fred Ray (OutWest Meat Company)Molly
McAdams (HEB Supermarkets)
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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Key Messages From The NBQA -- 2005 Strategy
Workshop
(1) Deliver product attributes that meet consumer
needs/expectations for safety, taste, color and
convenience. (2) Improve the cattle by
implementing instrument grading reducing numbers
of carcasses of YG 4 or 5 controlling weight
increasing marbling decreasing variation, and
maximizing profitability. (3) Expand marketing
opportunities (in domestic and global markets) by
developing traceability systems verifying source
and age reducing costs and waste in the beef
value chain, and continuing new product
development. (4) Strengthen connections among
segments of the beef supply chain via
communication and targeted educational programs.
SOURCE Strategy Workshop of the NBQA -- 2005
(Oklahoma City, OK) October 2005.
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