At the recent Certified Angus Beef annual conference in Verona, NY, the hot topic of conversations among attendees was potential impacts of beef cattle herd contraction. John Stika, president of CAB, and others in the speakers’ lineup, were on hand with pragmatic — but positive — news about the brand.

CAB closed fiscal year 2024 with its second strongest sales year in the brand’s history with growth in both domestic and international markets. The brand recorded 1.237 billion lbs sold across the United States and 55 other countries. CAB producers continue to deliver on quality despite tightening fed cattle supplies, and consumers continue to reward the brand with sales. So as long as consumers continue to buy beef with more than just price in mind, CAB has opportunities to shine with high-quality beef.

“Beef production in the US and Canada has never been more focused on delivering Certified Angus Beef qualifying carcasses to the market than it is today,” Stika said. “We see this so evident in the information that we gather from our licensed packers as this year our licensed packers certified 5.92 million carcasses, increasing that number over last year, producing the second-biggest supply of Certified Angus Beef ever in our history.”

CAB production

According to CAB, 37.2% of all Angus cattle went on to meet the brand’s data science-based specifications for quality. Heading into a period where fed cattle supply will tighten, Stika encouraged attendees to “keep in mind that the economic signal to focus on producing will remain, and we believe and are extremely confident that Angus producers and cattle feeders will continue to elevate quality and will continue to elevate the percent of available cattle that ultimately qualify for Certified Angus Beef.”

This effort includes increasing the number of carcasses that qualify for Certified Angus Beef Prime. Stika said in the past year a record 12.8% of the brand certified population of beef cattle qualified as Certified Angus Prime, an increase of 16% over the prior year. Certified Angus Beef Prime sales marked a new milestone with 50.5 million lbs sold, growing 22.5% from 2023, CAB said.

Given current market conditions, record sales of Certified Angus Beef Prime are another sign that consumers base their buying decisions on more than price. It’s also a sign that a premium product such as CAB Prime can continue to be a very strong growth vehicle in spite of declining cattle supplies and higher pricing, Stika told the audience.

Stika noted that “… history would suggest that as prices have had to increase over the years, consumers ultimately have been willing to come along with us.”

“Although price is extremely important, don’t get me wrong, consumers continue to show us that the purchase of Certified Angus Beef is a price-in-relation-to-value purchase decision,” he said.

The brand is also focused on providing consumers options with three additional line extensions: Certified Angus Beef Natural, Certified Angus Beef Grass-Fed and Certified Angus Beef Ranch to Table.

Anyone questioning the availability of carcasses that will grade out to CAB specifications has cause for concern. The brand’s successes have been notable, but headwinds remain for producers.

Randy Blach, CEO of CattleFax, said beef cattle growers will produce enough supply of carcasses, but they are facing headwinds, including drought conditions that have improved, but stubbornly persist.

“From a beef industry standpoint, we’ve had droughts that we’ve had to deal with over the course of the last several years,” Blach said. “Again, things are in better shape today, but we’re still not fully through this drought cycle.

“And I think as you go back and look at where the industry is in total, and you think about where we are from a drought standpoint, whenever you see one of these drought maps like this, that shows a lot of red, and browns and yellows — it’s not good, is it? Well, we’re in much, much better shape than we were two, three and four years ago. But we’re still in a grinding cycle.”

Driving concerns about drought conditions is a La Nina weather pattern that looks like it’s going to persist for another 12 to 18 months, Blach said, which is what keeps producers from retaining more heifers and growing their herd.

Given these conditions, beef cattle production levels are going to decline, Blach said, and there are going to be more competitive meat supplies available — such as more pork and poultry.

“I know we don’t want people trading to pork and poultry,” he said, “but the issue is as we come through these tighter supplies, the key thing is we want them to be able to put protein on their plate, don’t we? So, I think there will be some of that trade down.”

Value-added piece of the puzzle

The industry continues to meet consumer demand for premium beef from Michelin-starred white tablecloth establishments to refrigerated meat cases.

CAB recorded continued foodservice growth with 415 million lbs sold across independent specialty, broadline and corporate specialty distributors. Domestically, foodservice experienced the second-best year ever, marking 14 years of growth out of the past 15 years.

But competition for consumers’ food away from home dollars is fierce. More consumers are willing to cook at home post-pandemic, so grocery stores are their destination of choice. Meanwhile, foodservice operators are trying to find ways to convince diners to take a break from the kitchen table and return to restaurant tables.

“Some of the things they’re looking for are better quality products,” said Ken Eifrid, director, business development at CAB. “They’re looking for labor savers, inventory stabilizers. They’re looking for prices that are not going to fluctuate as much. And so, there’s no surprise that value-added products can hit on a lot of those aspects.”

CAB’s foodservice partners accounted for 65% of the growth in value-added product sales, Eifrid noted. Value-added CAB product offerings include corned beef, roast beef, brisket, and Bonewerks Certified Angus Beef Demi-glace which launched in February.

Supermarket shoppers still reached for the Certified Angus Beef brand at the refrigerated meat case albeit in slightly lower numbers, with retail stores recording 521.5 million lbs sold, a 1.7% decline from the previous year. Stika attributed the decline to “a margin pressure reduction in feature activity.”

However, this marked the sixth year of more than 500 million lbs sold across retailers, representing the fourth consecutive year of growth and the 10th year of growth out of the last 12.

“I continue to be excited to see the continued growth and demand that exists for value added products,” he said. “And more so than that, I’m excited to see the way our brand partners continue to step forward to meet that demand with certified products.”

Stika called out Buc-ee’s, a travel center chain known for its clean bathrooms, fresh food and Buc-ee the beaver mascot, for the retailer’s sales of value-added briskets.

“It’s probably no surprise if you’ve been to a Buc-ee’s location that our growth this year was really driven by smoked, fully cooked briskets with that category alone growing by 27%,” he said. On a category basis, Certified Angus Beef value-added products saw a fourth year of continued growth, reaching 45.5 million lbs.

Meanwhile, other categories — beef bacon, consumer packaged beef, fresh and frozen, and ground beef patties, in addition to CAB’s new hot pot beef rolls — showed strong growth both domestically and internationally.International Certified Angus Beef product sales grew by 4.6% in 2024 to 194.8 million lbs. At a time when overall US beef exports were easing, CAB said this huge growth was in large part due to increased sales in Mexico, which grew by 30%, making it the brand’s second-largest international market.

Picking up Prime

Sales of Certified Angus Beef Prime marked a new milestone with 50.5 million lbs sold, growing 22.5% from 2023, CAB said. Given the current beef market conditions, it may seem counterintuitive in the context of news about consumers trading lower-cost proteins for premium ones. But the numbers indicate that consumer beef purchasing decisions are driven by more than price.

“The reality is that we had a phenomenal year with Certified Angus Beef Prime,” Stika said, with growth occurring across every division of business from 15% to 17% growth at retail, to growth in excess of 50% in CAB’s international business.

“I’m here to tell you that there is more growth to be had with Certified Angus Beef Prime,” Stika said.

Certified Angus Beef Natural did experience a decline this year, Stika noted, while Certified Angus Beef Grass Fed sales performed extremely well in its first year since launching with partner Niman Ranch. JBS USA will begin to produce Certified Angus Beef Grassfed product in the coming months, Stika said.

Ranch-to-table partnerships

Yet another growth opportunity for the brand is Ranch to Table, which Certified Angus Beef will continue. CAB launched the Ranch to Table initiative in 2023. It is a partnership between CAB and cattle operations engaged in direct-to-consumer beef merchandising.

“While most of the producers involved in Ranch to Table are primarily interested in consumer direct sales right off the farm or perhaps out of the storefront that they operate as well, there is a growing number of Angus producers looking to scale their production and to create strategic supply relationships with many of our licensees and brand partners,” Stika said.

To qualify for the program, ranchers must register with Angus genetics, which requires American Angus Association active membership or proof of bull registration. Producers must also be Beef Quality Assurance certified. Cattle must meet CAB’s live animal evaluation with a predominately solid-black hide. Additionally, carcasses must meet CAB’s 10 specifications. Licensed producers work with a processor and a US Department of Agriculture grader to verify that brand specifications are met.

Stika said, “It’s tremendously rewarding to see a lot of those relationships begin to come to fruition at a very locally relevant level, and we’re confident that we’ll see more of those types of relationships coming together as Ranch to Table continues to grow moving forward.”