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The Future of Angus Beef. Tom Brink. Effective Business Pyramid. Added Value & Product differentiation. Commodity principles: Low costs & production efficiency. Both are required for success in today’s industry. Angus Beef. “More or Less” evaluation. What will we see MORE of ?. - PowerPoint PPT Presentation
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Commodity principles:
Low costs & production efficiency
Added Value &
Product differentiation
Effective Business Pyramid
Both are required for success in today’s industry.
MORE of the SAME regarding
Angus Beef Popularity
Dominant position with consumers will be maintained, because Angus is synonymous with HIGH QUALITY
• 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%).
• Booker Elkhorn Valley Packing• Harris Excel• Packerland National• Swift Tyson• Washington Beef Creekstone
• Plus…distributors SYSCO and AFG • Even Wal-Mart has an Angus brand
Packers are using the Angus name in their brands:
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.
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.
Angus Beef is Everywhere
…most recognized name in branded beef
Angus Ground Chuck Products80/20
•Midwestern Grain fed
•USDA Prime, Omaha Steaks Angus & USDA Choice
•Custom Hand-Trimmed
•Small Pack Sizes
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 Beef33,400
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.
Prime & Choice Quality Grades
40% 38%
64%
Texas Kansas Nebraska
Week ending 9-10-05Costing the Beef Industry >$160 million per year
Why? because…
• No success goes unchallenged• “Can’t 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 don’t care how the
Angus genes get into the final product
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.
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”
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”
Ideal Angus Percentage?
50% - 75%
With the balance being Continental, as opposed to another British breed.
They said….
Total Yield Grade 4s & 5s
6%
11%13%
Texas Kansas Nebraska
Early September 2005
Increasingly difficult for feeders and packers to deal with
What will we see LESS of? LESS opportunity to produce cattle with
anonymity LESS profit potential on commodity cattle
that can’t 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
Angus genetics will be recognized as the main
ingredient for the entire beef supply chain
But not the only ingredient