We Should Add Grass-fed Beef Category To The Grading System

Beefs and Beliefs

With ground beef the fair-haired boy of the beef complex it makes sense to foster cheaper, grass-fed beef production.

Published on: September 5, 2013
 

A few days ago at the Grassfed Exchange meeting in North Dakota our friend Bill Helming suggested we add a grass-fed/forage-fed category to the existing grading system.

I find this an interesting and potentially valuable idea.

Fundamentally, Helming's suggestion is based on the fact American consumers, the primary consumptors of all U.S.-produced beef, are increasingly pinching their limited pennies and buying primarily ground beef, a product which is not dependent upon grain-fed cattle for quality.

He says the current grading system implies to consumers that grain-fed, Choice or Prime beef is the only way to get quality. Most people in the industry know that is not definitively true and especially when the vast majority of beef purchased today is ground beef.

Tough competitor: This data shows how ground beef sales keep eating a larger portion of the entire carcass.
Tough competitor: This data shows how ground beef sales keep eating a larger portion of the entire carcass.

In fact, Helming says more than 56% of the total beef produced today is made into ground beef and most packers readily admit they grind a lot of chucks, which are primarily roasts, and also a lot of rounds, which could be various round steaks and roasts.

Ground beef consumption has increased from 42% of the total beef consumed in the United States in 1976 to more than 56% of all beef eaten today. Helming's own calculations on this ground beef trend, together with the effects of the ongoing depression we're in, clearly suggest the trend can only continue.

Per capita beef consumption in the U.S. has dropped from 94 pounds in 1976 to 57 pounds in 2012. Per capita chicken consumption was 36 pounds per person in 1976 and was 81 pounds per person in 2012.

Helming adds that, between beef and chicken, beef had a market share of 73% in 1976. In 2012, the market share for beef was 41%. That means beef lost 44% of its market share to chicken from 1976 through 2012.

"That is an astounding, unbelievably important number," Helming told me the other day when we talked on the phone.

"Consumers are buying less and less beef overall and it's not because it isn't a good product. Its strictly a matter of price!"

He says only four proteins have demand curves going north. All the rest are heading south.

The four winners are:

  • chicken
  • ground beef
  • eggs
  • cheese

The majority of consumers don't know or care how beef is produced," he adds. "Can I afford it? That's the number one question."

Helming quotes a 2012-dated 210 Analytics study done for the American Meat Institute in these statistics. It showed price per pound was number one, price per package was second in importance and product appearance was third in importance.

The August 2012 edition of Oklahoma State University’s monthly “Food Demand Survey” found consumers once again cited price as their primary concern.

So, to make this fairly long story fairly short, consumers want an affordable beef product. They want it now and will want it more in the future. Ground beef is that product. They're voting with their dollars.

We can produce beef more cheaply on grass than grain. That is inarguable. The only question is about animal size and type, therefore efficiency on forage, and also the certain squawk the packers will raise about killing slightly smaller animals.

Helming thinks leaving the old grading system alone and simply adding a category for forage-fed/grass-fed beef, or a similar moniker, could offer an alternative path. He suggests some target guidelines for carcass size and an age limit on the category of 30 or possibly 36 months.

I think these are reasonable talking points and we need more people in this conversation.

The grass-fed beef movement as it exists now is a high-priced alternative and that's just fine. Let's add an alternative market for animals produced using low-cost methods and let the market sort it all out.

The grain-feeding industry is in big trouble right now because it was built on feeding part of the beef animals very cheap grain. Then that cheap grain romanced it into feeding everything in an effort to get a higher percentage of animals to "make the grade."

Now we're feeding expensive grain to nearly every beef animal the final five or six months of life. We could change that easily. In fact, some of those feeders could jump right into a grass-fed beef/forage-finishing program using their lots and the acres many lease or own for grazing.

Helming says we don't need all the answers to this puzzle grass-fed beef grade right up front. We just need a framework.

Again, I think he's right. The industry doesn't need more central planning. It need freedom to grow.

Roll the idea around a little in your head and see if you agree.