The Status Quo By Allen R. Williams, Ph.D.
The "status quo" beef industry is dying a slow death, but many in the conventional beef industry do not recognize it yet. The consumer is slowly but surely taking charge of the products they buy and are now a major influencer on what food products surge forward in the retail marketplace.
That influence has been clearly evident in the rapid growth of the grass fed beef sector. In 1998, grass fed beef had retail value sales of a little less than $5 million with less than 150 grass fed beef producers involved. By the end of 2015, grass fed beef sales in the U.S. had grown exponentially to more than $3.5 billion, with $550 million in domestic grass fed beef sales and the balance being comprised of imported grass fed beef. There are now more than 4000 beef producers involved in grass fed beef production in the U.S.
Growth in the grass fed beef sector has been averaging between 25% and 30% for the past 12 years in a row. The commodity beef sector has seen stagnant growth during that same time period.
Over the past three years, there have been several major movements within the grass fed sector impacting growth and future growth.
1. JBS purchased Grass Run Farms to produce and market a domestic grass fed beef product in the U.S. with the intent to grow to 1000+ head of grass fats harvested per week.
2. Cargill has owned the largest beef processor in Australia for years now and has been actively marketing imported grass fed beef into the U.S. on a growing scale.
3. Sysco signed a multi-million $$ agreement with ABP Food Group to import Irish grass fed beef into the U.S.
4. Carl's Jr./Hardee's introduced a grass fed burger into a test market in the Fall of 2014. Within 6 months the test market had produced excellent sales of grass fed burgers and Carl's Jr/Hardee's expanded the grass fed beef burger to 100% of their U.S. stores.
5. Outback Steakhouse introduced a grass fed hamburger at all their U.S. locations.
6. Chili's has introduced a grass fed hamburger.
7. Almost every major Grocer retailer in the U.S. has introduced grass fed beef products into their stores (includes Kroger, Wegman's, Hi-Vee, CostCo, Wal-Mart Supercenter, HEB, Whole Foods, ........).
8. Virtually every major food distributor in the U.S. now carries one or more grass fed beef products.
9. National and Tyson are looking opportunities in grass fed beef.
10. Most of the existing All Natural Beef branded programs in the U.S. have added a grass fed beef line.
11. Bill Helming has stated publicly that he believes grass fed beef will comprise up to 30% of total U.S. beef production within the next 8 years.
12. In 2015 the U.S. Feedlot industry lost a reported $15 Billion. That sounds and looks like a broken industry.
There are now hundreds of conferences, workshops, field days, and other educational events each year that have at least one presentation pertaining to grass fed beef. The regenerative agriculture movement now has more active educational events annually than the commodity or conventional ag sector with far greater total attendance.
One other way we know that the grass fed sector has grown exponentially is that the pushback from the commodity sector has increased recently to a fever pitch. Even Elanco and CAB have come out with recent advertisements that supposedly rebuke the "myths" of grass fed beef. You know you are making an impact when people start to actively and publicly try to refute you. When the grass fed sector was very small, all the current noisemakers were silent. They never bothered with us. To now devote time and $$ to refuting grass fed beef is quite telling. You don't do that if you do not feel threatened.