1. The Beef Checkoff: Where we’ve been and where we’re going

2. 2 Beef Checkoff History Beef checkoff programs in the U.S. date back to 1922 … when the assessment rate was 5¢ a carload

3. 3 Beef Checkoff History Voluntary state programs Referendum in 1977

4. 4 Complicated Value-added assessment Voting at ASCS offices Required two-thirds majority Failed (56.6%)

5. 5 Referendum in 1980 Reduced assessment Required simple majority Targeted 30,000 “joiners” Failed (34.6%)

6. 6 Prior to 1985 Farm Bill Surveyed producers – ask what they wanted

7. 7 What Producers Wanted Everybody pays/simple assessment –No free rides Grass-roots Control –States keep 50 cents Producer Control –Nominated by fellow producers

8. 8 What Producers Wanted Cost-effective program –Limit on administrative expenses Test run to see if it works –18-month test period before voting

9. 9 Referendum in 1988 Simple assessment ($1 per head) Voting at Extension offices Required simple majority Passed (79%)

10. 10 Today’s Beef Checkoff Program Established as part of the 1985 Farm Bill Became mandatory via national referendum vote by producers in 1988 States retain 50 cents on the dollar; forward 50 cents to Beef Board CBB administers program, subject to USDA approval

11. 11 Where Checkoff Dollars Come From $1 per head invested by about 900,000 beef, dairy & veal producers – $72.1 million $1-per-head equivalent invested by importers – $7.6 million $1 per head invested by producers in five states without beef councils – $44,000

12. 12 Program Definitions Promotion Research Consumer Information Industry Information Foreign Marketing Producer Communications

13. 13 Beef Checkoff Guidelines No lobbying No Unfair or Deceptive Practices No reference to a brand or trade name of any beef product without Beef Board and USDA approval

14. 14 Beef Checkoff Guidelines No expenditures that relate primarily to live cattle production or marketing – must be directly related beef or beef products.

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16. 16 Coordinated Programs Nationwide industry Global marketplace Operating Committee combines state and national leadership

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18. 18 2008 Beef Industry Contractors National Cattlemen’s Beef Association National Livestock Producers Association American National CattleWomen U.S. Meat Export Federation Meat Importers Council of America American Veal Association

19. 19 Key Beef Checkoff Accomplishments

20. 20 “Beef. It’s What’s for Dinner” 86 percent of consumers recognize tagline New campaign celebrates “The Power of Protein in the Land of Lean Beef.”

21. 21 Muscle Profiling Analyzed more than 5,500 muscles from chuck and round Found several muscles traditionally ground had potential for higher-value steaks

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23. 23 New Product Development More than 2,500 new products since 1998

24. 24 Beef Nutrition, Education Nutrition & Beef: Developing a positive relationship

25. 25 Leaner than Ever! 29 beef cuts meet government guidelines for “Lean” – including favorites like tenderloin, T-bone and 95% lean ground beef.

26. 26 Leaner than Ever Before! Comparing 3-ounce cooked servings, these cuts have only 1.2 grams more saturated fat than a skinless chicken breast yet less total and saturated fat than the same size serving of a skinless chicken thigh Research shows lean beef can play the same role as skinless chicken or fish in a cholesterol- lowering diet

27. 27 Beef Quality Audit National Beef Quality Audit in 1991 said industry was leaving $279.82 per carcass on the table due to: –waste (fat) –insufficient muscling –taste (palatability, marbling, maturity and gender) –management (hide defects, carcass and liver pathology, tongue infection, injection sites, bruises, dark cutters, etc.) –carcass weight.

28. 28 Beef Quality Audit Follow-up audits in 1995 and 2000 showed reductions in waste from $279.82 per animal in 1991 to $104.92 per animal in 2000!

29. 29 Beef Quality Assurance 2005 BQA audit: Focused on identifying needs for BQA/producer education efforts vs. comparison, but still found: 6-percent increase in cattle grading Choice or higher and 3 percent increase in yield grades 1 and 2. Significant reductions in brands, bruising and horns

30. 30 Safety Research & Intervention Since 1993, checkoff has invested more than $35 million in beef-safety research Today, checkoff-developed food safety systems are used in processing of 90% of fed cattle in the U.S. and can reduce bacteria during processing by 99.99 percent

31. 31 Foodservice Partnerships Over six years, the beef checkoff allocated $2.4 million to foodservice partnerships, while partners invested $138.6 million

32. 32 Food Communications Reach consumers more than 1 billion times a year by providing editors with recipes, photos and beef facts

33. 33 Checkoff Results? What does it all mean for the beef industry?

34. 34 Evaluation Specific outcomes Measurable Achievable Relevant Time bound

35. 35 Beef Demand Index 1. USDA per capita beef supplies 2. USDA Choice retail prices 3. Adjustment for inflation based on Consumer Price Index 4. Fixed relationship between beef price and quantity demanded, called elasticity

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37. 37 Beef Demand All told, Cattle-Fax estimates that the increase in consumer demand for beef since 1998 has added about $250 per head to the price of fed cattle and about $200 per head to the price of calves

38. 38 Consumer Confidence Percent confident U.S. beef is safe from BSE

39. 39 Beef Safety Prevalence of E. coli O157:H7 in Ground Beef First BIFSCo Meeting Held Jan. 2003 * and ** indicate a change to more sensitive sampling and methodology

40. 40 Carcass Value New products created through muscle profiling contributed to a $60- to $70-per-head increase in value of the chuck, and new products represent 28 percent of demand growth since 1998 - Cattle-Fax Flat Iron $5 - $6 lb Chuck Roast 99¢/lb

41. 41 Consumers Responding! More than 20,000 restaurants have offered Beef Value Cuts and about 10,000 U.S. supermarkets are offering them – nearly double the 5,000 offering them in 2005 and up from just 321 in 2003

42. 42 Consumer Expenditures on Beef

43. 43 Accountability Producers in the U.S. are the investors and hold all contractors accountable for expenditures Important to follow procedures set by the Beef Board through USDA and the CBB Executive Committee Two important rules include checkoff acknowledgment and brand or trade name references

44. 44 Acknowledgment Critical to acknowledge funding source or sources so investors realize return on investment Simple “Funded by the Beef Checkoff” with Beef Check Logo with domestic use USMEF has a variance for multi-species international marketing

45. 45 Beef Checkoff Acknowledgment With the realization that the Beef Check Logo may not have particular meaning in some international arenas, it is adequate for multi-species promotional and educational materials in these markets to appear with USMEF’s U.S. Meat logo. –If, however, the materials are used in presentation in the U.S., the Beef Check Logo and tagline must be used. If another funding source, such as pork or MAP funding, is recognized with a separate logo, then the Beef Check Logo must also be included, though the domestic tagline is not required. –Must be at least as prominent in size and location as other logos.

46. 46 Beef Checkoff Acknowledgment The “American Beef Club” logo may be used in place of the Beef Check Logo in international markets if no other protein logos are used. The “High Quality American Beef” logo is appropriate for use in place of the Beef Check Logo when the nature of the activity requires use of only one logo. When no other species’ logo is used but the activity is jointly funded by beef and pork, for example, the tagline “Funded by U.S. beef and pork producers” or similar wording may be used, and the Beef Check Logo omitted.

47. 47 Brand & Trade Name References Any reference to brand or trade names where beef checkoff dollars are invested must be approved by the Beef Board and USDA

48. 48 Looking Ahead What can we do better?

49. 49 Long Range Plan 2010 Increase demand 10% by 2010 Become a net exporter in terms of value by 2010

50. 50 Enhancing the Checkoff USDA asked Beef Board to gather ideas CBB Administration Subcommittee will make recommendations to CBB Executive Committee by November 2008 Full Beef Board will vote on recommendation from Executive Committee in January 2009

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