Over on the Beef Daily Blog yesterday, Amanda asks, “How much will you pay for that rib eye?” That caught my attention for two reasons:

First, because we get all our meat as freezer beef, pork and chicken from my parents or my in-laws, we get a pretty darn good discount. I often think of how high our grocery bill would be if we tacked on all the meat we consume in a week and I wonder how much I would pay. Would my supper selections be different?

And two, because working for Certified Angus Beef LLC, I’m keenly aware at the price difference between a high-quality product and a commodity one.

A large portion of our staff works on the beef side of the business– that’s from the packing plants forward, so as a whole we spend quite a bit of time analyzing how much people will pay for beef. (Specifically how much of an emphasis they’ll put on quality and how much more they’ll pay for that extra flavor and tenderness.)

So I thought I’d tackle (most of) these questions one-by-one:

• “What’s your take on this supply and demand issue?”   Continue reading “How to get them to pay more for that rib eye”

I love airports.

I know most people hate them, but I like showing up early for a flight so I can spend a few extra minutes there. I love the people watching; I love the diversity; I enjoy the hustle and bustle. Mostly, I love that people are just a little more friendly than normal when they know we all have a common bond: We’re all going somewhere to do something other than our daily routine. An airport lends itself to the world’s easiest conversation starting ice breaker: “So, where ya heading?”

I strike up a lot of random conversations in boarding lines, airport bars and with new seat buddies. Not surprisingly, many of these conversations end up on an agriculturally related topic as soon as my new friend and I start exchanging career information.

Some people are enamored with the idea of actually growing up on a farm/ranch and love looking at photos of my parent’s cattle on my cell phone; others tell me about their cherished memories of visiting grandpa’s old farm as kids. Sometimes the conversations gets in-depth enough that we chat about concerns we often hear: organic v. traditional product, grass-fed v. grain-fed, hormones, antibiotic use, humane treatment, etc.

I always start those conversations by first asking, “Why are you concerned about that?” “Why is feeding your family grass-fed beef important to you?” “What do you consider a ”factory farm,” and why is that bad?” With those thoughts in mind, it’s almost always easy for me to empathize and understand their point of view, whether I agree with it or not. That makes for a spirited discussion and interesting information sharing. That’s fun. Continue reading “Food morality on the ranch”

Why are fed cattle prices as high as they are? Well, of course that’s a complicated question with lots of answers relating to cattle supply and beef demand. One very important but less talked about factor is the “drop value” or “drop credit” of a steer.

That’s simply the value of the items that are “dropped” off the carcass – hide, tallow, meat and bone meal, and variety meats like liver, tongue and heart. While these are not the highly sought after cuts most U.S. consumers desire, they do add significant value to the beef animal. In particular, hide value makes up about half of the total drop value.

This chart shows the dramatic rise in drop value of a steer in the past two years.

It’s doubled since early 2009.  That $7/cwt. increase, when applied to a 1,300 lb. steer, equates to Continue reading “More than a drop in the bucket”