The Future

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The Future of Angus Beef
Tom Brink
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Effective Business Pyramid
Added Value Product differentiation
Commodity principles Low costs production
efficiency
Both are required for success in todays industry.
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Angus Beef
More or Less evaluation
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What will we see MORE of ?
LESS of ?
Winners, Losers and making the industry better
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MORE of the SAME regarding
Angus Beef Popularity
Dominant position with consumers will be
maintained, because Angus is synonymous with HIGH
QUALITY
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• CAB started the revolution in 1978.
• Today USDA lists 51 certified beef brands.
• 35 brands use the ANGUS name (69).
• 15 new beef brands were created in 2004 and 2005
  alone
• And 14 of these incorporate ANGUS into their
  label (93).

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Packers are using the Angus name in their brands

• Booker Elkhorn Valley Packing
• Harris Excel
• Packerland National
• Swift Tyson
• Washington Beef Creekstone
• Plusdistributors SYSCO and AFG
• Even Wal-Mart has an Angus brand

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                        Black Angus SteaksFor
those who only insist on the very best, only
Angus beef will do. Famous for its tenderness,
juiciness, and flavor, this is the kind of meat
that melts in your mouth. Pfaelzer Brothers has
established a set of strict quality standards to
insure that when you care enough to send Black
Angus Beef, you get only the very finest.
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Angus Beef is Everywhere most recognized
name in branded beef
                        Black Angus SteaksFor
those who only insist on the very best, only
Angus beef will do. Famous for its tenderness,
juiciness, and flavor, this is the kind of meat
that melts in your mouth. Pfaelzer Brothers has
established a set of strict quality standards to
insure that when you care enough to send Black
Angus Beef, you get only the very finest.
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• Midwestern Grain fed
• USDA Prime, Omaha Steaks Angus USDA Choice
• Custom Hand-Trimmed
• Small Pack Sizes

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Google Search Test

• Angus Beef 1.38 million matches
• Hereford Beef 312,000
• Charolais Beef 131,000
• Limousin Beef 124,000
• Simmental Beef 116,000
• Gelbvieh Beef 46,100
• Salers Beef 32,200
• S. Highlander Beef 33,400

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More Differentiation in Angus Beef Program
Specs
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More Granularity

• Live animal requirements
• Marbling, maturity yield grade
• Carcass weight range
• Natural product claim
• Source verified
• Age Verified
• Story line raised and fed with a mountain view

Affording both opportunity and risk for producers.
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More Room for a few strong Non-Angus Beef
Brands
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More Angus Beef from Southern Cattle in
Southern Plants
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Costing the Beef Industry gt160 million per year
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The problem is easy to see
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What do most Southern Genetics need ?
Answer Hes black and walks on four
legs
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More Angus Beef from Non-Angus Parents
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More Angus Beef Produced from Hybrid-Angus
Bulls on Angus-based cows
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Why? because

• No success goes unchallenged
• Cant beat them.join them
• Hybrid vigor still matters in the cow-calf
  business
• Structured cross-breeding too difficult to
  implement
• Hybrid seedstock are convenient to use
• More muscle (better YGs) from Continentals
• Feeders, packers and consumers dont care how the
  Angus genes get into the final product

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Tracking the Hybrid Movement

• Simmental ---SimAngus - 40 of annual
  registrations
• Gelbvieh ---Balancers - 33
• Limousin ---Lim-Flex -12
• 60 and 40 of Chi and Maine registrations are
  Angus-based hybrids, respectively.
• Approximately 50,000 total registrations this
  year and growing by 15 to 20 annually.

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Hybrid Seedstock Registrations
100,000 by 2010
Per Year
Angus-based.
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Five Rivers Personnel Comment on Angus Strengths

• Grade, Grade, Grade Quality Grade
• Premium Programs
• Uniformity ---add uniformity to a calf crop
• Rib and Volume
• Able to eat a lot of feed
• Crossing ability with other breeds
• Marketability

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Five Rivers Personnel Identify Angus Soft Spots

• Over fats
• Cutability problems before reaching desired
  dressing percent
• Higher percentage Angus means lower yields and
  a higher percentage of YG4s YG5s
• Dressing percent, yield grade muscling
• Not enough muscle for their out weights
• They cost too much

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Ideal Angus Percentage?
They said.
50 - 75
With the balance being Continental, as opposed to
another British breed.
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More problems with YG4s in the Northern
U.S. (in the short run)
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Increasingly difficult for feeders and
packers to deal with
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What will we see LESS of?

• LESS opportunity to produce cattle with
  anonymity
• LESS profit potential on commodity cattle that
  cant fit any branded beef program
• LESS room for seedstock and commercial cattle
  that have no Angus influence
• LESS of a hard line distinction between some
  breeds---Angus genetics are becoming the common
  link

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What does all this mean to you as an Angus
breeder?
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Angus genetics will be recognized as the main
ingredient for the entire beef supply chain
But not the only ingredient
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A whole new level of genetic accountability for
seedstock and commercial producers is on the way
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Extremely broad range of needs wants within
commercial cow-calfsegment
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Angus genetics---some in a non-traditional
package---will continue to win big in the years
ahead
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Angus in both Purebred and Hybrid form will
dominate more of the seedstock sector
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Cement is the main ingredient in concrete
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Both products can produce concrete
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Purebreds and Hybrids Selling Side by Side
ANGUS
Angus inside
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The U.S. Beef Industry WINS too.