Beef Demand Determinants Report Prepared to the Beef Board Joint Evaluation Advisory Committee

Beef quality, consumer incomes, attention to beef in medical journals and the general media, and shifts in race composition of the U.S. population are key determinants affecting beef demand in the long term.

So concludes a study deputed by the Beef Checkoff program called "Assessing Beefiness Need Determinants." The study summarizes the current knowledge of consumer demand for beef, and identifies the best opportunities for the industry to influence demand positively.

Authors of the report include Dr. Glynn Tonsor, professor of livestock marketing at Kansas Country University, Dr. Jayson Lusk, distinguished professor and head of the Section of Agricultural Economic science at Purdue University, and Dr. Ted Schroeder, professor of livestock marketing at Kansas State University.

"The information gathered and analyzed for this comprehensive report is invaluable to the beef industry, in general, and to the Beefiness Checkoff program, in item," said cow-calf producer Jackie Means, a member of the Cattlemen's Beef Promotion & Inquiry Board and chair of the Joint Evaluation Committee that commissioned the inquiry for the checkoff. "Members of the Cattlemen'southward Beef Board and directors of the Federation of State Beef Councils will be asked to use the information in this report in making decisions about how to invest Checkoff dollars in Fiscal Year 2018 and across."

Understanding Beefiness Demand

Agreement beef demand and how to impact it is a daunting job, yet the study'southward authors note that it also is critical to the industry'south long-term viability.

Given the country of the cattle manufacture'south supply, the understanding of beef demand vs. consumption is particularly critical.

One very important signal in developing strategies to grow beef demand volition exist clarification of the part of per capita consumption in beefiness demand. Per capita consumption is, in effect, per capita availability of beefiness, the economists note. Demand, on the other paw, effectively refers to the quantity of beef that consumers will buy at a given price, with all other factors held constant.

"Beef purchasing decisions have go less sensitive to retail beef prices. While prices will always thing, this reinforces the importance of manufacture focus on beef quality aspects: taste, appearance, convenience, and freshness," said Dr. Tonsor.

"In short, both beef supplies and cattle prices increased in 2017 relative to 2016 – an outcome simply possible with demand growth," the report notes. "A perpetual industry priority is to better understand and monitor beef demand, and to inform stakeholders because need straight influences overall manufacture success."

What is Of import to Beefiness Producers?

It has been a critical need for the industry to understand what beef demand is: Is it as potent today compared to the past? What has made information technology strong? Those kinds of basic questions have been of import to the Beef Checkoff for a very long time. If beef demand is stiff, and so higher prices are being paid for beef than would otherwise exist the case. That'due south because higher prices being paid for beef in turn leads to college prices for wholesale beef, higher fed cattle, and college feeder cattle prices, and most producers recognize that do good in the form of higher cattle prices.

Ane of the things the research did was to update elasticity estimates, or how sensitive purchasing behavior is to prices. If the price goes up by one%, how many fewer pounds are purchased? This study showed U.S. consumers are less sensitive to beef prices than they used to be. That does not mean price doesn't matter, only the numbers showed that a 1% increment in price has a smaller impact on beefiness consumption than it used to.

"What I believe that signals is that beef quality issues such as taste, advent, and freshness have elevated over fourth dimension," said Dr. Tonsor.

"The tone and bear upon of 'hot topics' covered in the media and medical customs can alter notably over fourth dimension," continued Dr. Tonsor. "In past years, discussions effectually fatty were a detriment to beef need simply more recently these discussions take enhanced beef demand. Similarly, this written report shows how Atkins Diet discussions remain supportive of beef demand, simply less then than a decade before."

What Can the Checkoff Do?

Based on enquiry, data, and information examined, the researchers prepared five key recommendations for Checkoff leaders to consider in making decisions about how to invest Checkoff dollars:

1. Beef quality aspects such every bit taste, appearance, convenience, and freshness are innate product quality attributes identified equally acme priorities in by beef demand studies, and they remain cardinal for sustaining and growing beef demand.
2. External coverage of "hot topics" is probable to continue to be dynamic for the beefiness industry. Researchers made the recommendation for systematic reassessment of which topics take the largest net impact on beefiness demand and focus on those.
3. Increase collaborative approaches with the U.Due south. pork and chicken industries. Given limited cantankerous-toll sensitivity and a host of common challenges and opportunities, a more collaborative arroyo may ameliorate utilize the manufacture's limited resources given recent increases in competition from plant-based protein sources.
4. Recommend additional targeting of beef product development, messaging, and marketing to consumers with detail attention to race, income, age, political ideology, and product type considerations.
5. Comport a systematic evaluation of information sources available to gain beef demand insight. Multiple data sources and methods were used to gain a more complete understanding of beef demand determinants, and the researchers encouraged more than focus on leveraging existing industry investments to regularly appraise beefiness demand.

Download the full written report here: "Assessing Beef Demand Determinants."

The Beef Checkoff programme was established as part of the 1985 Farm Bill. The checkoff assesses $1 per head on the auction of alive domestic and imported cattle, in improver to a comparable assessment on imported beef and beef products. States may retain up to 50 cents on the dollar and forwards the other 50 cents per head to the Cattlemen'south Beef Promotion and Research Board, which administers the national checkoff program, subject area to USDA approval.

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Source: https://www.beefboard.org/2018/01/31/many-factors-impacting-domestic-beef-demand-study/

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