LAS VEGAS – Final figures will be released in October, but 2023 is shaping up to be the third-best year of global sales for the Certified Angus Beef (CAB) brand. More than 700 Angus cattle producers, foodservice operators, distributors and more CAB brand partners from across the United States and 15 countries gathered at the Red Rock Resort in Las Vegas to take stock of the brand’s successes while sharing strategies to cope with lower numbers of Angus cattle and higher prices for consumers that already are feeling the biting effects of inflation across all categories of goods and services.

John Stika, CAB president, noted strong demand for CAB products despite high prices. For example, he described the month of March as “an absolute highlight reel” from a brand perspective.

“Our acceptance rate surpassed the 40% threshold for only the third time in any given month in our history,” he said. “That ultimately fueled the single largest monthly supply of Certified Angus Beef carcasses.”

And sales of 112 million lbs of CAB product made March the third-best sales month in the brand’s history, Stika added.

“If we look at it from a divisional perspective, what we have seen is our foodservice partners continued to demonstrate their tenacity and resilience growing sales in foodservice for the 13^th time in 14 years making 2023 the second-best year for foodservice,” Stika continued. “But what I find the most impressive is the fact that this year, we saw growth and success across all of our domestic distribution, as we saw sales increase across our independent and specialty companies, we saw sales increase across broadline distributors, and we saw sales increase across corporate specialty meat companies.”

International CAB partners helped sales grow at a time when overall US beef exports were down, Stika said. For 2023, seven of CAB’s top 10 largest international markets grew sales.

Retail sales of CAB products were also strong in terms of volume, although retail sales declined due to reduced feature activity because of increased prices, Stika said. A third of the brand’s retail partners grew their sales in 2023.

Sales of value-added products are on track to set a record in 2023 marking the third consecutive year of growth and the ninth year of growth out of the last 11 years.

“This year, we saw CAB growth across retail, foodservice and international, and that growth was primarily led by fully cooked smoked brisket sales at foodservice and was supported internationally by fresh corned beef sales at retail, as well as consumer packaged fresh and frozen ground beef patties,” he said.

CAB Natural sales declined after a growth spurt in 2022, but Certified Angus Beef Prime had a “phenomenal year” hitting record sales.

Following his review of the state of the CAB brand, MEAT+POULTRY sat down with Stika to talk about the challenges facing the brand in tightening supplies of Angus cattle that meet CAB’s rigorous specifications.

Stika said the story starts with supply.

“Across our industry we’re all starting to feel the pressure of lower cattle numbers and tighter beef availability,” he said. However, CAB has seen positive signs that reassure the community about what they can expect in 2024 which is likely to be more difficult than 2023.

“From our standpoint, we leave this year looking to the next with a tremendous amount of optimism knowing that it’s not going to be easy,” he said.

M+P: You talked about some headwinds during the first general session. Could you elaborate on some of those issues?

Stika: Absolutely. You know, I think the biggest one that is going to affect everybody universally is we're going to be in a period of tight supplies. You know we, with the extended drought induced herd liquidation that we've seen across the region, we've got the smallest North American cow herd that we've seen in over 50 years.

And so, we know that the climb back is not going to be overnight. We're moving into a period that's not going to be a one year type of situation. We're talking multiple years before we're back to where maybe supplies are more ample for the demand that exists both domestically and internationally. And obviously with that we expect higher prices, and I think that's the conclusion that folks have made.

And I would tell you that we’ve kind of known this was coming because of the pace that it has been developing. You know, drought comes on slow, and you recover slow. So, I think that there’s not a surprise feeling among our group of what’s in front of us. I think everybody is prepared for the reality. And I think that’s why it’s so important to make sure that if we can expect higher prices to know that the consumer has given us some indications that if the value is there, they’re willing to pay for it if the price is fair.

M+P: And as evidenced by the fact that you’ve added some new retail partners, they're not afraid to make the offering either. So, they feel good about the brand.

Stika: That’s exactly right. You know it’s been interesting, where we’ve seen folks in the marketplace kind of begin to back away from quality, and honestly force their customer to trade down on quality. We’ve seen a number of examples, some of them that I highlighted here, Longo’s in Canada was an example that I looked at, actually launched a Certified Angus Beef Prime during this time period and saw their prime sales grow and their overall Certified Angus Beef sales grow as well.

So, I just think we’re in this period of time where we can’t get sheepish or back away from putting the best product out there and asking a fair price for it. We also have to be sure that we’re communicating to the customer what the value proposition is so that they can understand why it commands a higher price.

Read additional comments from Stika in future dispatches from the CAB Annual Conference.