A Changing Beef Industry Will Respond
to Consumers and Challenge Producers
The beef industry continually changes. Traditionally, production levels expand and contract in reaction to profits for cow-calf operations. These "cattle cycles" send waves through all parts of the industry.
Other greater changes are rocking the industry, in the way it is organized and the types of products delivered. The invention and growth of the fast food industries in the 1960s lead an expansion of the industry around hamburgers. All of these changes are attempts for the market driven beef industry to respond to consumers, even though most of the decisions are made on farms by managers of the cattle enterprises.
Behind all of these changes are some key trends at the consumer level with reactions and responses from the industry. One of the most dominant one is the time at home compared to the time on the job. With a majority of households in the "two wage earner" category. Time is at a premium. The industry's response is a move toward "convenient meal solutions" and food consumed away-from-home, which is now about 40% compared to 25% 30 years ago.
Food safety and nutrition also are pushing the industry. Food safety is an expected standard - PERIOD. Meat processors have has responded in ways most consumers will never see or know about. A whole new approach to inspection has been implemented. Healthier products, typically in terms of lower fat, are on grocery shelves. Food safety is also pushing the industry toward "source verification" - or traceback. It is now technically possible to be able to identify the farm of origin for final meat products. While this is not yet common in the U.S., it will be soon, following the lead of Europe and Canada.
As the beef industry develops the new products, often tagged as "value added" the rest of the industry has to respond with the right raw product. Producers are responding with genetics, management and health programs designed to deliver the right kind of raw product to the processors. The pork and poultry industries have gone to integrated supply chains to coordinate the system. In contrast, the beef industry is working through markets and alliances.
What do these national trends mean for Kentucky beef cattle managers? Most importantly, leaders in Kentucky's beef industry must develop options for producers to participate in the modern beef industry. Producers need help in learning about the new technologies, deciding which fit their situations, and then putting them into practice. Kentucky versions of alliances and related production systems will be part of this. The bottom line is that the beef industry is changing. Producers will have a choice to be part of the progressive segment which responds to consumers or the segment which is ignoring the needs of its customers.
For More Information
For additional information, please contact, Lee Meyer.