Of all the issues that concern you about your beef business, the eroding power of your checkoff should be chief among them.
Cattlemen voted to begin the $1-per-head Beef Checkoff Program more than 20 years ago with an overwhelming 79 percent approval. Over the years, surveys of cattlemen confirm that the approval rating remains strong. In recent years, approval rates have consistently ranged between 68 percent and 73 percent.
In September, the Cattlemen’s Beef Board approved a $46.8 million national program budget for the coming year. That money funds beef promotion campaigns, research and information programs, and is designed to build demand for beef. Promotion programs use the lion’s share of the budget, about $22.8 million. Promotion efforts include new consumer advertising, retail marketing, foodservice marketing, new product and culinary initiatives, the National Beef Cook-Off, a Northeast beef promotion initiative, and veal promotion.
Over the past two decades, your Beef Checkoff has funded numerous programs that have helped spur increased demand for beef. Industry economists point to checkoff-funded programs as a significant contributor to the 15 percent increase in consumer beef demand over the past 10 years.
Unfortunately, your checkoff is fighting an uphill battle with dwindling resources. That’s because the program is stuck with 1980s’ resources and 1980s’ buying power. A dollar just doesn’t buy what it did 20 years ago.
Nearly two years ago, cattlemen began discussing the possibility of increasing the checkoff. The mood of the industry had changed. The constitutionality of the checkoff had been upheld by the U.S. Supreme Court, and an array of producer groups — some with distinctly different views of the checkoff — came together to review the checkoff and work toward making it better for everyone.
An increase in the checkoff will require action by Congress. Officials from the U.S. Department of Agriculture have indicated that such a proposal would need unified support from the beef industry and from the various groups that represent producers. And another nationwide producer vote would be required.
Understandably, industry leaders are moving forward cautiously on this issue. It’s important that it be done correctly. But the need for an increase in beef promotion and research funds has reached a critical point.
Last month at the Texas Cattle Feeders Association convention in San Antonio, National Cattlemen’s Beef Association president John Queen said it is “impossible to get what we need out of our checkoff” when it is limited to the same budget established in the 1985 Farm Bill. “It takes about $1.90 to get the purchasing power, due to inflation, that $1 gave us 20 years ago.”
Queen also noted the checkoff’s buying power has been diminished by increases in carcass weights in the time since the checkoff was instituted. “In 1986, the average carcass weight in the United States was 656 pounds. Last year in the United States, the average carcass weight was 779 pounds —almost 20 percent more beef and still just a single dollar to successfully market it.”
Prices for calves and yearlings this fall remain relatively strong, despite some recent declines, and your initial reaction might be that an increase in the checkoff is unnecessary. But consider the latest forecast on U.S. consumption. In calendar year 2007, the estimated weight of retail beef consumption per person in the United States is expected to decline about 0.5 pounds to just over 65 pounds. That’s the lowest per capita consumption since 2003. And next year beef consumption is expected to decline even further, to possibly the lowest total per person since 1960.
We need to increase our per-head checkoff to at least $2, and maybe more. More importantly, our industry needs to move forward on this issue with all urgency.
In the coming months, many state cattlemen’s organizations will hold their conventions and annual meetings. You can help move this issue forward by contacting leaders of your state association and requesting that increasing the Beef Checkoff be part of the discussion at those meetings. Already, the North Dakota Stockmen’s Association passed a resolution at its convention to raise the checkoff to $2 per head. Let’s keep this momentum rolling.