Why Doesn’t the Beef Checkoff Promote U.S. Beef Domestically?

There has been a lot of recent discussion in the media among producers about why the beef checkoff doesn’t specifically promote “U.S. beef” in its domestic advertisements and promotions. We would like to provide some information that might help checkoff investors better understand why that is.

It’s important to remember that state beef councils and the Cattlemen’s Beef Board all operate under the requirements of the Beef Act and Order – the enabling legislation under which our checkoff operates – and must remain in compliance with those documents.

The Act states the purpose of the Beef Checkoff Program as “carrying out a coordinated program of promotion and research designed to strengthen the beef industry’s position in the marketplace and to maintain and expand domestic and foreign markets and uses for beef and beef products.”

In the domestic market, the role is to nourish the growth of consumer demand for beef and beef products in general, not just a particular category of beef.

The Act and Order further require all importers of live cattle, beef and beef products to pay the equivalent of one-dollar-per-head on those imports. Those assessments have added an average of $6.9 million per year to the national beef-checkoff budget during the last decade. And the “Guidelines for the Approval of Programs Under the Beef Promotion and Research Act” state, in Section III, that since producers and importers subject to the beef checkoff assessment are required to contribute under the Act, “expenditures of checkoff funds should benefit the entire industry.”

The mission of the checkoff is to build demand for beef among consumers by serving as a catalyst to provide consumers with beef research, information and promotion of beef, in general – on the tenet that “a rising tide lifts all boats.” In other words, protecting general beef demand opens the door for individual producers, importers or companies to serve and promote to their favored niche markets – such as local, grass- or grain-finished, antibiotic-free and the like – if they want more specific branding.

To maintain quality standards of the entire domestic beef supply, cattle imported to the United States, regardless of its country of origin, must meet the same USDA Food Safety Inspection Service (FSIS) and Animal and Plant Health Inspection Service (APHIS) standards that beef produced in the U.S. must meet. Under statutory authority, APHIS and USDA Veterinary Services monitor the health of all cattle, including semen and embryos, and beef and beef products that are imported to the U.S. Importers must meet requirements of an Import Checklist and obtain a veterinary permit for import of materials derived from cattle to ensure animal and meat health and safety.

Why Imports?

Let’s address one more topic at the very base of this that we’ve also seen bantered about in the country of late – why do we import beef into the U.S. anyway?

To be sure, the need for imports is not as simple as the number of cattle needed to meet demand but instead the demand for certain parts of the animal, such as lean trim, according to ag economists nationwide, including Dr. Thomas Elam, Ph.D. Lean trim is in very short supply in the U.S. because the number of beef and dairy cows and bulls being sent to market has declined significantly during the last decade. We simply don’t produce enough lean. Over time, the United States has increased production of 50s-percent lean and reduced production of 90s, mostly due to economic factors.

With that, the vast majority of beef imported to the U.S. is lean trim, 90-plus percent – primarily from Australia and New Zealand – to mix with 50/50 lean and fat ground beef produced in the U.S. so we can meet domestic consumer demand for lean beef. Without this, the U.S. beef supply would run far short of the lean ground beef required to meet our strong consumer demand for it. Importing lean trim to meet this need helps continue to grow domestic consumer demand for beef. Dr. Elam says that imports of lean beef actually enhance the value of the U.S. beef market and overall cattle prices and, in addition, allows U.S. cattlemen to maximize their competitive advantage of fed beef production.

This article was originally posted on the Montana Stockgrowers Association website at mtbeef.org.