Learn about the history of beef in the food service industry.

1. Industry History

2.  Industry History and Background
 Economic Factors
 U.S. Imports and Exports
 Beef Price Cycles
 Beef Production in the U.S.
Intro to the Beef Industry

3. Industry History and Background
1400s 1500s 1600s 1700s 1800s Late 1800s
Cattle reach
Texas, California
from Mexico
Cattle industry
emerging in
Florida
Cattle reach
New England/
New York from
England,
Northern Europe
Cattle business
thriving; focused west
Family owned/managed
Produce 4-5 yr. old
grass-fed steers;
shipped by live train

4.  Chicago/Kansas City epicenter for sorting, distributing
cattle via rail
 Packers/processors also at rail centers
 Refrigerated rail cars invented by G.F. Swift
 Larger packers operated regional shipping/distribution
 New York, Boston, Philadelphia
19th Century

5.  Federal Meat Grading System, 1920s
 Federal Interstate Highway System, 1950s
 No longer dependent on railways
 From Carcass to Primal Cuts
 Boxed beef
 Led to vacuum packaging
 Led to block-ready, boneless, case-ready beef
20th Century

6.  Economic recession
 Beef demand falls
 Cattle numbers drop to historic levels
 Cattle and beef prices reach record high levels
Early 20th Century

7.  From producer-driven to consumer-driven
 Beef demand in rapid decline
 “War on Fat,” 1990
 “Taste Fat” vs. “Waste Fat”
 Revived interest in quality which helped rebuild
demand
Late 20th Century

8. Variables Impacting Beef’s
Profitability
+750,000
U.S. Farmers and
Ranchers
Average
herd size
44
89.2
million
cattle
(2012)
Beef
production
43.4
billion lbs.
Gross income
of cattle
$52 billion
total inventory value
$110 billion
$74 billion
Total consumer
expenditures

9. Economic Factors Affecting
Supply and Demand
Top exporters
of beef
Top U.S. export
market
Top US beef
supplier

10.  The U.S. has 8% of the world’s cattle and produces 21%
of the world’s beef
 The U.S. remains the largest importer of beef globally,
buying 2.3 billion pounds in 2010 valued at $2.83 billion
 80% of the beef imported into the U.S. comes from
Canada, Australia and New Zealand; mainly lean grinding
beef for fast food hamburgers
Imports

11.  The U.S. was the #3 exporter of beef in 2010, behind
Brazil (#1) and Australia (#2)
 2010 exports were 2.3 billion pounds valued at $3.53
billion
 The U.S. currently exports 10-11% of production
 Top export markets include: Mexico, South Korea, Japan
and Canada (~70% of total beef exports)
 The U.S. exported beef to 146 countries in 2010
Exports

12.  Typically peaks in spring and fall when middle meat
demand is strongest and cattle supplies are lowest

13.  Bulk of cows used for lean trimmings are marketed in the
fall, resulting in lower prices
 Tighter supply + grilling demand support prices in
spring/summer

14.  Best prices during colder winter months (cooking
methods)
 Increase in price due to new steak cuts
(Flat Iron, Petite Tender, etc.)

15.  Holiday celebrations and summer grilling increase
demand and price

16.  Higher prices in spring result of limited supply, especially
for Choice

17.  Similar to Chucks; peak during colder months
 Prices decline in summer due to increased supply +
decreased demand

18.  Family owned/operated industry
U.S. Beef Production
80% in same family for 25+ years
10% in same family for 100+ years
 Cattle raised in all 50 states
 Various cattle breed types and crossbred cattle
 Adapt to various conditions

19.  Seedstock Producer, grassland based
 “Purebred” segment
 Genetic base for breeding stock
 Cow/Calf Producer, grassland based
 Combine genetic lines to best meet market demand
(crossbreeding)
 Sells to stocker or feedlots
 Stocker
 Specialized segment
 Use grasslands as natural resource
 Sells to feedlots for grain-based finishing
 Feedlot
 Use higher energy diets to achieve rapid gains to
create the world's highest-quality beef products
U.S. BEEF PRODUCTION
At the Ranch

20.  Harvest finished
cattle
 Fabricate
carcasses into
subprimal cuts
 Sort and “box”
beef
 Market to
purveyors,
processors
U.S. BEEF PRODUCTION
From Packer to Market to Table
 Fabricate boxes of
subprimal cuts
 Sell to foodservice
operators, retailers
 Present product
to consumer
Packers Purveyors/
Processors
Foodservice
Operators/Retailers

21.  May be marked by product specifications or production
standards
 May include such factors as:
 Specific breed influence
 Quality standards based on USDA grading
 Specific product characteristics
LABELING CLAIMS
Branded Beef Products

22.  Not more than “minimally processed”
 Label must explain “natural”
 i.e., no added colorings or artificial ingredients
LABELING CLAIMS
Natural Beef

23.  Cattle MUST:
 Be raised separately
 Have access to pasture, though many are feedlot
finished
 Be fed 100% organically grown feed (grains and
forage)
 Be treated when sick
 When treated with antibiotics, must be removed
from program
 Cattle MAY:
 Be provided certain vitamin and mineral supplements
 Cattle MAY NOT:
 Be given antibiotics or enhancers for any reason
(or must be removed from program)
LABELING CLAIMS
Certified Organic

24.  Prohibited:
 Synthetic pesticides on pastures
 Sewage sludge for fertilization of feedstuffs
 Irradiation on beef products
 Producers must be certified through USDA’s Agricultural
Marketing Service (AMS)
LABELING CLAIMS
Certified Organic

25.  Feeding regimen for livestock raised on
 Grass, green or range pasture, forage
 Shall be 80% or more of the primary energy source
throughout animal’s life
LABELING CLAIMS
Grass-Finished Beef

26.  Single most sustainable, renewable form of agriculture
that produces an amazingly nutrient-dense source of
protein
 American beef industry dates back to 1500s
 Railroads, federal highways revolutionized industry
 Federal regulation began in 1920s
 Focus moved from producers to consumers in late 20th
century
 Tough to manage supply and demand for beef
 Industry is major contributor to U.S. economy
 U.S. a top importer and exporter of beef
 Beef cuts experience seasonal shifts in price/demand
 Specialty beef requires special labeling
Summary

27. Beef Industry History: QUIZ
1. The American beef industry raises cattle in how many
states?
A. 37
B. 3
C. All 50
D. 15

28. Beef Industry History: QUIZ
2. What percentage of the American beef industry’s farms
and ranches have been family-owned and/or – operated
for at least 25 years?
A. 90%
B. 10%
C.80%
D.None
3. True or false: U.S. feedlots use higher-energy diets to
achieve the rapid gains that create the world’s highest-
quality beef products.

29. Beef Industry History: QUIZ
4. Who fabricates carcasses into subprimal cuts?
A. Stocker
B. Seedstock producer
C.Packer
D.Purveyor/processor
5. True or false: “Natural” beef can be processed to a
considerable extent.

30. Beef Industry History: QUIZ
6. Which is not true of certified-organic beef?
A. Cattle may be given vitamin or mineral supplements
B. Cattle may receive antibiotics to treat illness
C.Cattle may be feedlot-finished
D.Cattle must be fed 100% organically grown feed

31. Beef Industry History: QUIZ
7. For beef to be labeled grass-finished, at least what
percentage of the cattle’s primary lifetime energy source
must be grass, green or range pasture or forage?
A. 100%
B. 50%
C.60%
D.80%

32. Beef Industry History:
QUIZ KEY
1. C. All 50 (See slide 18)
2. A. 90% (See slide 18)
3. True (See slide 19)
4. C. Packer (See slide 20)
5. False (See slide 22)
6. B. Cattle may receive antibiotics to treat illness (See slide
23)
7. D. 80% (See slide 25)

33. Resources
 FactsAboutBeef.com
http://factsaboutbeef.com/
 Beef industry statistics
http://www.beefusa.org/beefindustrystatistics.aspx
 Beef Industry Social Responsibility Report
http://www.beeffoodservice.com/beefindustrywhoweare.as
px
 About Beef Production
http://beefretail.org/beefproduction.aspx
 Choices of Beef fact sheet
http://www.beefnutrition.org/CMDocs/BeefNutrition/Choice
sofBeef_Final_web.pdf

34. Resources
 USDA Agricultural Marketing Service
 Standardization and Technology Division
http://www.ams.usda.gov/AMSv1.0/LSSTDZ
 Meat Certification Services
http://www.ams.usda.gov/AMSv1.0/LSMeatGradingCe
rtificationServices
• USDA Claims Guidance
http://www.fsis.usda.gov/wps/portal/fsis/topics/regulatory-
compliance/labeling/Claims-Guidance
 USDA Labeling Procedures
http://www.fsis.usda.gov/wps/portal/fsis/topics/regulatory-
compliance/labeling/labeling-procedures