Tackle Your Biggest Beef Profit Give-Aways

You may be giving away $43.66 per head with cattle that fail to meet ideal beef quality targets, according to NBQA.

Published on: Nov 16, 2012

What better time than year-end to take a glimpse at where you've been and where you're going in the beef business. The best, most comprehensive way to get a grip on your (and the beef industry's) progress has been the National Beef Quality Audits, contends Harold Harpster, newly retired Penn State University animal scientist and still a cow-calf producer.

The monumental task is conducted every five years by the National Cattlemen's Beef Association. And, it couldn't be done without your checkoff dollars, he points out.

Here's the "meat" of the most recent conclusions from last spring's NBQA workshop. They provide an action blueprint for the industry for the next five years.

Tackle Your Biggest Beef Profit Give-Aways
Tackle Your Biggest Beef Profit Give-Aways

Clearly, customer concerns have moved to top priority in producers' minds. The steady rise in the percentage of cattle grading USDA choice or prime – from 45% in 2000 to 61% in 2011 – shows a strong commitment to quality. It also demonstrates the progress possible when we seriously address an issue, says Harpster.

Where producers are losing dollars

The NBQ audit estimates the "lost income opportunities" that producers suffer from failing to produce cattle meeting ideal quality targets. The latest audit pegged total losses at $43.66 per head.

Given the impact of price incentives and discounts based on USDA quality grade, it's no surprise that quality grade discounts represent the lion's share of losses. Here are the estimated value of the cost of being off-target:

Quality grade discounts: - $25.25
Carcass weight: - $6.75
Yield grade: - $5.77
Offal value: - $5.15
Hide value: - $0.74

It may not be easy to fix some of these problems, acknowledges Harpster. But, he adds, the payback for addressing them is significant.