Beef quality grade matters

As quality grade increases, consumer happiness in our beef product goes up as well.

Nevil Speer

February 11, 2016

2 Min Read
Beef quality grade matters

A recent white paper authored by Daryl Tatum, Colorado State University, gives an interesting and compelling review of how increasing carcass quality and quality grade not only helps the bottom line of the cattle producer, but the eating experience of our consumers.

The review titled, Recent Trends: Beef Quality, Value and Price, highlights aggregate results of five recent studies on the topic of beef quality. Not surprisingly, the studies reveal that marbling improves the odds of a favorable product.

Specifically, the probability of a strip loin steak producing a positive eating experience within the Prime, Premium Choice, Low Choice, Select and Standard quality categories is 97%, 93%, 82%, 66% and 55%, respectively. Alternatively, the odds of having a negative eating experience were roughly 1 in 34, 14, 5, 3 and 2 for Prime, Premium Choice, Low Choice, Select and Standard, respectively.   

beef demand and beef quality

More uniquely, the paper detailed the effects of upgrading from a lower quality grade to a higher category. This week’s illustration highlights increased odds of a favorable outcome through the upgrade. Tatum’s paper describes it this way, “For example, the Premium Choice vs. Low Choice comparison indicates that the odds of a satisfactory overall eating experience are 2.9 times greater if one chooses the Premium Choice steak.” And the data further illustrates that the further the upgrade, the greater the improvement.  

Those results are consistent with prior research: improved quality grade scores really do matter when it comes to general consumer perception of the beef industry by consumers. Interestingly enough, Tatum’s paper begins with a quote by Benjamin Franklin: “The bitterness of poor quality remains long after the sweetness of low price is forgotten.” 

What’s your perception of the effect of trading up to higher quality grades? How should the industry use this type of data in terms of developing production systems and subsequent marketing material for consumers? Based on this type of research, how does the beef industry ensure it differentiates itself from competing protein sources and prevent against getting caught in the commodity trap where price is the primary point of differentiation?    

Leave your thoughts in the comments section below.

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About the Author(s)

Nevil Speer

Nevil Speer serves as an industry consultant and is based in Bowling Green, KY.

Nevil Speer has extensive experience and involvement with the livestock and food industry including various service and consultation projects spanning such issues as market competition, business and economic implications of agroterrorism, animal identification, assessment of price risk and market volatility on the producer segment, and usage of antibiotics in animal agriculture.
Dr. Speer writes about many aspects regarding agriculture and the food industry with regular contribution to BEEF and Feedstuffs.  He’s also written several influential industry white papers dealing with issues such as changing business dynamics in the beef complex, producer decision-making, and country-of-origin labeling.
He serves as a member of the Board of Directors for the National Institute for Animal Agriculture.
Dr. Speer holds both a PhD in Animal Science and a Master’s degree in Business Administration.

Contact him at [email protected].

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