Fewer Cattle and Less Bang for Checkoff Buck

Speakers at cattle conference say beef industry must do more with less.

Terry Stokes, chief executive officer of the National Cattlemen's Beef Association, told cattle producers at Friday's opening session of the Cattle Industry Summer Conference in Denver that the beef cattle industry's structure has changed dramatically in recent years. He presented the following facts:

• In 1975, there were 46 million beef cows, and today there are 33 million;
• In 1980, there were 1.013 million beef cattle operations, and today there are 762,000, and
• In 1982, the feeder cattle supply exceeded 40 million head, and today, it totals about 28 million head.

"So we have fewer cattle and less operations," he said, "But we are producing more beef today than we did in 1975 with 13 million fewer cows."

Stokes said this change means there are fewer cattle from which to raise checkoff dollars for beef promotion and research and fewer operations from which to draw NCBA membership.

Stokes said that the industry must do more with less, a position that was echoed by Dave Ramey, CEO of the National Beef Promotion & Research Board. Ramey noted that the beef industry's long range plan, as adopted in 2005, calls for a 10% increase in beef demand by 2010 - "10 by 10" - and the achievement of both 3 billion pounds in beef exports and becoming a net beef exporter.

He said this will take considerable prioritization due to "a dwindling budget" - $6 million less this year than last - as "there just is not enough money to do everything that we need to do."
The Beef Board's buying power has also dwindled, he said, pointing to how today's checkoff dollar is worth 50% of the 1987 checkoff dollar and to how:

• In 1986, it cost $350,000 for a 30-second advertisement on The Cosby Show, the most popular television show at the time, but today, it costs $700,000 for a 30-second spot on American Idol, and
• To reach the same number of people that were reached with the Cosby ad actually takes $1.225 million because consumers are no longer confined to just three television networks.

"We will need a sharper knife" to pair checkoff funds to programs, he said.

However, Ramey said the board has been making progress, reporting that both beef production and beef prices have shifted higher and to the right in recent years, a definitive indication of demand improvement.

He also said consumers' confidence in American beef has increased from 88% in September 2003 to 91% today.

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