Summary of the Tennessee Value-Added Beef Program ( )

Transcription

1 Summary of the Tennessee Value-Added Beef Program ( )

2 Special appreciation is extended to the many individuals, agencies and organizations involved in the development and implementation of the Value-Added Beef Program. External Funding Partners Tennessee Department of Agriculture Ag Tag 2014 Tennessee Value-Added Beef Conference Planning Team USDA, Federal-State Marketing Improvement Program (FSMIP) Valerie Bass Tennessee Beef Industry Council USDA/NIFA, Southern Risk Management Education Program Megan Leffew Steve Harris Rob Holland Charles Hord Tennessee Cattlemen s Association Ryan King Tennessee Farm Bureau Federation Dwight Loveday Patty McDaniels Rebekah Norman Hal Pepper Justin Rhinehart Wendy Sneed Tennessee Department of Agriculture Value-Added Beef Team Leaders Rob Holland Megan Leffew Dwight Loveday Hal Pepper Justin Rhinehart Value-Added Beef Program Team Members Ronnie Barron Valerie Bass Tennessee Beef Industry Council Kevin Ferguson Andrew Griffith Charles Hord Tennessee Cattlemen s Association Kim Jensen University of Tennessee AgResearch Debbie Joines Tammy McKinley Rebekah Norman Jonathan Rhea Bobby Simpson University of Tennessee AgResearch Jerri Lynn Sims Wendy Sneed Tennessee Department of Agriculture Janna Sullivan Tennessee Beef Industry Council Bill Thompson Tennessee Department of Agriculture B University of Tennessee Institute of Agriculture

3 Summary of the Tennessee Value-Added Beef Program ( ) CONTENTS Contents Executive Summary 2 Issue... 3 Approach.. 4 Research 6 Outreach 7 Workshops, Seminars and Webinars... 8 Conference.. 10 Publications. 12 Benefits Future 16 Summary and Conclusions. 17 University of Tennessee Institute of Agriculture 1

4 Executive Summary The Tennessee Value-Added Beef Program grew out of a clear need: Tennessee cattle producers seeking information about finishing, harvesting and direct marketing beef. The program, including components supported with funding from FederalState Marketing Improvement Project (FSMIP), Southern Risk Management Education Center (SRMEC), and Tennessee Department of Agriculture (TDA), exceeded its original goals. This report summarizes the accomplishments of the ValueAdded Beef Program and concludes with future research and outreach needs. A major reason for program success was the more-thananticipated expansion of collaborative networks since the program began in The Value-Added Beef Program Team ultimately included 20 members from five agencies and 30 Tennessee Extension agents cooperated in the program outreach activities. Activities of the program to date included: 64 educational workshops, seminars, tours, conference and webinars with 1,965 participants 100 participants registered in value-added beef webinar group 759 participants registered in value-added beef group Value-added beef exhibit presented at 22 events with 2,881 in attendance 18 educational publications, fact sheets and case studies completed 119 attendees at the 2014 Tennessee Value-Added Beef Conference, with 2 University of Tennessee Institute of Agriculture 12 members of the Planning Team from five different agencies 18 speakers/presenters, 13 exhibitors, seven sponsors Many individual farms expanded their value-added beef marketing since This expansion is confirmed by these data: 149 percent increase in the number of farm-based retail meat permits issued by TDA from December 2011 to May 2015 (from 57 to 142) The number of freezer beef operations listed on the Pick Tennessee Products website increased by 47.5 percent from February 2011 to May 2015 (from 80 to 118) The number of meat marketing farms listed on the PTP retail meats website increased by 83 percent from February 2011 to May 2015 (from 48 to 88) This program would have been impossible without the many cooperating Extension personnel and funding agencies listed on the inside front cover. We also extend deepest thanks to the farmers and processors who generously lent their time and expertise to this program. Their insights were essential for developing a program that continues to improve agricultural profitability in Tennessee. Rob Holland, Director Center for Profitable Agriculture

5 Summary of the Tennessee Value-Added Beef Program ( ) Issue Beef cattle are raised in each of Tennessee s 95 counties. Tennessee cattle farms and ranches focus on cow-calf production, with scattered pockets of backgrounding and stockering. Beef cattle and calves accounted for $540 million of Tennessee farm receipts in percent of statewide farm product sales. Tennessee cattle farm receipts increased from 2012 to 2015, the result of higher feeder cattle prices. About half (48 percent) of Tennessee s 68,050 farms sold beef cattle in Tennessee counted 883,000 beef cows in January 2015, the third-largest cow herd east of the Mississippi River. Tennessee s beef herd (1.5 million cows, calves and bulls in 2015) graze more than 3 million acres of pasture and wooded areas in Tennessee. Most Tennessee cattle are shipped west, to cattle feeders. The Value-Added Beef Program responded to a strong interest from cattle producers in delivering Tennessee beef to local customers. This follows a broader increase in selling farm products directly to customers. Tennessee farm sales direct to the consumer increased from $15.38 million in 2007 to $19.2 million in Value-added beef has helped increase and diversify direct farm marketing in Tennessee. From 2011 to 2015, the number of farm-based retail meat permits issued by the Tennessee Department of Agriculture increased by 149 percent (from 57 permits issued in 2011 to 142 issued in 2015). The number of freezer beef enterprises listed on the Pick Tennessee Products website also increased during the same time period up 47.5 percent (from 80 in 2011 to 118 in 2015). These increases are provided in Figure 1. Figure 1. Increases in the number of Farm-Based Retail Meat Permits and the number of Freezer Beef Operations listed on the Pick Tennessee Products website from 2011 to University of Tennessee Institute of Agriculture 3

6 Approach Tennessee beef producers most often cite marketing as a barrier to growing value-added beef businesses. For this reason, the Value-Added Beef Program was developed with a special emphasis on marketing and business enterprise development. As shown in Figure 2. external funding for program activities included a $90,000 Federal-State Marketing Improvement Program (FSMIP) grant, a $44,918 Southern Risk Management Education Center (SRMEC) grant from USDA/NIFA, and $20,000 from TDA. More than $9,000 in sponsorships and registration fees helped fund the inaugural 2014 Value-Added Beef Conference. The Center for Profitable Agriculture and other individuals and departments in UT Extension made substantial in-kind contributions to all Value-Added Beef Program activities. Figure 2. External funding for the Tennessee Value-Added Beef Program, 2011 to The FSMIP-funded project, Enhancing Value-Added Beef Opportunities, identified consumer preferences for Tennessee-raised beef. It also evaluated the costs associated with production and marketing meat products to those consumer preferences. Primary components of the project included: 1. Surveying local consumers regarding interest, product preferences and buying patterns for locally raised beef 2. Conducting producer focus groups to determine beef product labeling and packaging preferences 3. Evaluating enterprises costs for direct marketing 4. Delivering findings into various outreach and educational venues 4 University of Tennessee Institute of Agriculture

7 Summary of the Tennessee Value-Added Beef Program ( ) (As a direct result of the Center s involvement), We believe our sales have increased by at least 30 percent, and we have been able to create employment for three additional people. -Phil Baggett, Tennessee Grass Fed Farm, Clarksville The USDA/NIFA Southern Risk Management Education funding provided value-added beef producers with educational and networking opportunities. This funding focused on managing and reducing financial, price and legal risks. This was accomplished by: 1. Developing educational materials about managing risk by addressing regulations, business planning and marketing nine value-added beef producer profiles three Extension publications four in-state, on-farm workshops with 106 participants 337 members of Google Group networking tool 2. Conducting educational workshops, seminars and webinars to present risk management information 11 webinars with 44 participants one out-of-state tour with 28 participants The TDA Ag Tag program provided matching funds toward the Value-Added Beef Program through June These funds directly supported: 1. Sponsoring the 2014 Value-Added Beef Conference 2. Developing eight educational publications 3. Creating the Value-Added Beef Program exhibit University of Tennessee Institute of Agriculture 5

8 Research Moore, and Jamey Menard AIM AG Research Report May 2014 The FSMIP grant anchored the Value-Added Beef Program s research component. This included beef consumer and market research, as well as farm-level production and marketing cost analysis. Consumer Research Consumer Preferences for Tennessee Beef By Kim Jensen, Megan Bruch, Leah Dobbs, and Jamey Menard* *Professor, Agri Industry & Modeling Analysis Group, UT Department of Ag. & Resource Economics, Marketing Specialist, UT Center for Profitable Agriculture, Graduate Research Assistant, and Research Associate,UT Department of Ag. & Resource Economics Based on national trends in local food preferences, the research found value-added beef consumers were more likely present in Tennessee s metropolitan areas: Memphis, Nashville, Knoxville and Tri-Cities (Kingsport/Johnson City/Bristol). Consumers surveyed in Tennessee s metropolitan areas were willing to pay a premium of $2.96 per pound for ribeye steaks and $0.70 per pound for ground beef labeled Tennessee Beef. Respondents said purchasing Tennessee Beef gave them a sense of supporting Tennessee farmers and the economy. Respondents perceived Tennessee Beef as fresher and safer than out-ofstate beef. Those choosing Tennessee Beef products tended to be younger in age, have some farm background, and have higher incomes than the overall set of respondents. D9 June 2014 Freshness, safety, support of local farms, and support of local economies appear to be important considerations when respondents selected beef products. These areas might be emphasized in future marketing programs to promote products labeled Tennessee Beef. Tennessee Value-Added Beef Entrepreneur Experiences Producers Focus group research, conducted from December 2013 to January 2014, collected insights from 26 producers representing 18 Tennessee beef farms. University of Tennessee Institute of Agriculture A CStudy14-All-Studies.indd 1 Focus group members sold beef: 6/16/14 10:37 PM From the farm and/or at farmers markets (55 percent) Through butchers/retail stores and/or to restaurants (22 percent) Through Community Supported Agriculture (CSA) (11 percent) Through online outlets (11 percent) Challenges common to producers across market outlets included pricing, product storage, delivery (logistics) and customer education. Producer focus group members also reported that value-added beef customers ask a lot of questions. According to the producers, consumer questions focus around the following topics: What cattle eat (all-forage or grain/grass) and whether farm uses feeds containing GMOs Whether cattle receive antibiotics or artificial hormones Where cattle live during finishing, especially whether cattle are confined If beef is natural or organic (though consumers did not always have clear definitions for those terms) If the animal is local or was raised on the seller s farm 6 University of Tennessee Institute of Agriculture

9 Summary of the Tennessee Value-Added Beef Program ( ) Marketing Costs The Value-Added Beef Program Team developed a publication detailing marketing costs for beef sold in Tennessee, including: Cost estimates for marketing through retail channels Start-up and operating costs for a very small-scale enterprise Budgeting framework to assist producers in effectively budgeting for their operations This cost-research focus provides a deliverable that can be used and modified across various farm sizes and production styles. Outreach Workshops, Seminars and Webinars The Value-Added Beef Program emphasized one-on-one information delivery throughout Tennessee, resulting in more than 60 educational workshops, seminars and webinars from 2011 to The outreach focus helped grow an extensive network among beef producers, specialists and educators. A summary of the outreach efforts is provided in Table 1. Table 1. Summary of Value-Added Program Outreach Efforts Topic Number of Events Dates Total Attendance Scratching the Surface 11 November 2011 to March Basic Regulations 13 August 2012 to May On-Site Value Added Beef April/May Out-of-State Farm Tour 1 September Production Costs and Considerations for Finishing Animals for Direct Marketing What You Should Know About Beef Quality and Meat Cuts How Much Meat to Expect, Improving Communications with Your Processor and Making Live Animal Sales 6 October/November November March Locally Raised Beef Marketing Workshop 3 March Producer Focus Groups 3 Dec Jan Webinars Other Value-Added Beef Workshops Extension Agent Training University of Tennessee Institute of Agriculture 7

10 We used a market survey to target our customers more effectively. We reviewed our risk assessment and made changes in our insurance. We also began reviewing where we stood on our financial plan weekly and are beginning to write a market plan and financial plan. Highlights from Workshops, Seminars and Webinars Tennessee Value-Added Beef 101 Workshops April May 2013 Presentations on regulations, profitability, processor-producer relationship, retail meat permitting 106 participants in four workshops Highest impact (responding participants): Increasing understanding of regulations involved with direct marketing meat Marksbury Farm Tour September 2013 Toured Boyle County, Kentucky meat processing, retail market and event facility Value -Added Beef 101 Workshop Participate 8 University of Tennessee Institute of Agriculture 28 participants Highest impact (responding participants): Improved understanding of how to develop and implement marketing strategies for a value-added meat business

11 Summary of the Tennessee Value-Added Beef Program ( ) What You Should Know About Beef Quality and Meat Cuts Workshops November participants in three workshops Participants indicated greatest increase in understanding of Traits affecting tenderness and flavor and USDA yield grades Production and Cost Considerations for Finishing Animals for Direct Marketing September December 2013 Six workshops with 191 participants Most important things learned at workshop: finishing/ready for harvest, cost, business plan Actions planned to implement: Improve business plan with budget/ financial information; improve calf selection/frame/timing Value-added beef workshops, seminars and other outreach activities were conducted in 33 percent of Tennessee counties: Shelby Lauderdale Tipton Lake Dyer Fayette Obion Crockett Haywood Benton Blount Cannon Cheatham Coffee Cocke Fayette Giles Grundy Green Hamblen Hickman Gibson Hardeman Weakley Madison Chester Mcnairy Carroll Henry Henderson Hardin Benton Decatur Stewart Perry Houston Humphreys Wayne Hickman Lewis Montgomery Dickson Lawrence Maury Giles Humphreys Jefferson Knox Lincoln Loudon Madison Marshall Maury McMinn Montgomery Perry Putnam Robertson Cheatham Davidson Williamson Marshall Lincoln Sumner Bedford Wilson Rutherford Moore Trousdale Coffee Macon Franklin Smith Cannon De Kalb Warren Jackson Grundy Clay Marion Putnam White Rutherford Sevier Sullivan Van Buren Warren White Williams Wilson Overton Van Buren Bledsoe Sequatchie Hamilton Fentress Cumberland Morgan Rhea Meigs McMinn Bradley Value-Added Beef Workshops, seminars & outreach activities conducted Pickett Scott Roane Polk Campbell Anderson Loudon Monroe Union Knox Blount Claiborne Grainger Hamblen Jefferson Sevier Hancock Cocke Hawkins Greene Washington Unicoi Sullivan Carter 64 educational workshops, seminars, tours, conference and webinars with Johnson 1,965 participants from 2011 to 2015 University of Tennessee Institute of Agriculture 9

12 Conference Overview Two-day conference held in Manchester, TN, March participants; 17 presenters; 14 agencies represented at trade show Respondents rated conference an average of 4.5 on a 5.0 scale of usefulness Highest changes in respondent understanding reported in: analyzing costs of finishing and direct marketing understanding local and conventional finishing/production systems understanding consumer preferences for local beef 100 percent of participants who make farm decisions reported they learned things at the conference that will help them make decisions and changes to increase sales, reduce costs and/or market their products more effectively Conference Speakers/Presenters and Panel Members Future Topics Requested by Participants in the Value-Added Beef Conference Grass finishing, grass vs. grain fed Marketing techniques and strategies Reproduction Farm tour Packing facility tour Recordkeeping software Multimedia and social media use Presentations from local beef buyers Meat cutting demonstration Year-round forage management Animal handling and welfare ρ ρ Use of cattle harvest byproducts (hides, etc.) Speaker/Presenter and Panel Member Phil Baggett Gary Bates Megan Bruch David Bryant Jeff Canavan Andrew Griffith Rob Holland Kim Jensen Dwight Loveday Hal Pepper Emmit Rawls Justin Rhinehart Michael Rice Johnny Rogers Dave Turner Margarita Velandia Bill Thompson James Yoder Agency/Affiliation Tennessee Grass-fed Beef Twin Oaks Farm LLC U. S. Department of Agriculture University of Tennessee AgResearch Claybrook Angus Rogers Cattle Company Claybrook Angus Tennessee Department of Agriculture Yoder Brothers Meat Processing 10 University of Tennessee Institute of Agriculture

13 Summary of the Tennessee Value-Added Beef Program ( ) 2014 Tennessee Value-Added Beef Conference Sponsors 1. Farm Credit Mid-America 2. Tennessee Farmers Cooperative 3. Tennessee Farm Bureau 4. USDA, Federal-State Market Improvement Program 5. Tennessee Department of Agriculture Center for Profitable Agriculture 2014 Tennessee Value-Added Beef Conference Trade Show Exhibitors Exhibitor/Agency 1. Farm Credit Mid America 2. Tennessee Beef Industry Council 3. Tennessee Cattlemen s Association 4. Tennessee Department of Agriculture, Consumer and Industry Services, Food and Dairy 5. Tennessee Department of Agriculture, Consumer and Industry Services, Weights and Measures 6. Tennessee Department of Agriculture, Market Development 7. Tennessee Department of Agriculture, Pick Tennessee Products 8. Tennessee Farm Bureau 9. Tennessee Farmers Cooperative 10. Tennessee Value-Added Beef Program 11. USDA, FSIS, Office of Field Operations (OFO) 12. USDA, FSIS, Office of Investigation, Enforcement and Audit (OIEA) 13. UT Beef and Forage Center 14. Center for Profitable Agriculture University of Tennessee Institute of Agriculture 11

14 Publications The development of written materials to be used in various outreach teaching events was another objective of the value-added beef program. Such materials greatly increase the effectiveness of workshops and seminars and they also create a path for longer term program implementation by being available for distribution and teaching and for one-on-one enterprise analysis. A complete summary of the value-added beef publications developed is provided in Table 2. All of the educational publications developed for the program are available on line. Limited printed copies of some of the publications are available from the Center for Profitable Agriculture and from County Extension Offices. SP 755 Understanding Yield Grades and Quality Grades for Value-Added Beef Producers and Marketers Rob Holland Director Center for Profitable Agriculture Dwight Loveday Associate Professor Department of Food Science and Technology The terms yield grade and quality grade are often, incorrectly, used interchangeably. The two terms are very different and they reflect very different carcass traits. It is important for cattle producers and value-added beef entrepreneurs to understand the difference between yield and quality grades and how both are determined and used in the industry. December 2013 Important to the understanding and application of yield and quality grades is the definition of beef quality, cutability and undesirable carcass traits. This publication is intended to provide definitions and explanations of these important terms for cattle producers and entrepreneurs that are interested in direct marketing beef. Yield grades Yield grade should not be confused with yield and should not be confused with quality grade. Yield is the dressing percentage which is calculated by dividing the carcass weight by the animal s live weight. Yield grades are expressed in numbers that estimate the percentage of expected cutability from a carcass. Cutability is defined as the percentage of closely trimmed, boneless, retail cuts from the round, loin, rib and chuck the four major beef wholesale cuts. It is an estimate of the relative amount of lean, edible meat from a carcass. PB 1821 The yield grade is determined by evaluating four carcass factors: 1. External fat thickness over the ribeye. 2. Ribeye area. A GENERAL GUIDE TO MARKETING LIVE ANIMALS FOR CUSTOM-EXEMPT HARVESTING AND PROCESSING 3. Estimate of the percentage of kidney, pelvic and heart fat. August Hot carcass weight. Tennessee Value-Added Beef PB 1822 Entrepreneur Experiences Jill Hoover Farm Introduction This publication is one of a special series highlighting the experiences of Tennessee value-added beef producers in the start-up and operation of their enterprises. The entrepreneurs have generously shared their stories and lessons learned in order to help other producers better understand the challenges, risks and opportunities that exist in this industry. We hope that these stories will be Regulations and Inspection Information for Direct Meat Marketing in Tennessee PB 1819 educational and informative. Jill Hoover and her husband purchased approximately 24 acres near Knoxville in Knox County, Tennessee in 2009 and wanted to use the property for agricultural purposes. She decided to raise cattle and enrolled in the UT Master Beef Producer Program. Jill considered the different segments of the cattle industry that would fit her small acreage and goals for operation. She decided to purchase calves to finish on her farm and then market those animals to consumers for custom-exempt processing. Marketing Live Animals to Consumers Jill now has 15 acres of pasture and forage devoted to finishing steers she purchases as weaned calves from a local farm. She finished and sold six steers in The steers are all sold as live animals through private sale to customers and delivered to a USDA-inspected, customexempt processor. Farmers using this marketing method need to clearly communicate the product being sold is a live animal and not meat. Selling meat in Tennessee requires more regulatory involvement, including the need to obtain a Retail Meat Sales Permit from the Tennessee Department of Agriculture Regulatory Services. Custom-exempt processing can only be done for the owners of the animal, and the meat is marked not for sale. University of Tennessee Institute of Agriculture General Overview of the History, Regulations and Inspection Information for Direct Meat Marketing in Tennessee University of Tennessee Institute of Agriculture A 12 University of Tennessee Institute of Agriculture HOW MUCH MEAT TO EXPECT FROM A BEEF CARCASS

15 Summary of the Tennessee Value-Added Beef Program ( ) Table 2. Summary of Value-Added Beef Publications Developed Title An Examination of Consumers Preferences for Differentiated Beef Products Basic Regulatory Considerations for Retail and Non-retail Meat Sales in Tennessee Listing of USDA Livestock Slaughter Facilities in Tennessee Retail Meat Sales in Tennessee: Basic Weights and Measures Regulations Tennessee Value-Added Beef Entrepreneur Experiences. A Series of Nine Case Studies Understanding Yield Grades and Quality Grades for ValueAdded Beef Producers and Marketers General Overview of the History, Regulations and Inspection Information for Direct Meat Marketing in Tennessee Number Authors Research Menard, Jensen, and Report English PB 1805 Holland October 2012 D-3 Pepper and Leffew September 2013 D-1 Leffew November 2013 D-9 Leffew and Others December 2013 SP-755 Holland and Loveday December 2013 PB 1819 Holland and Leffew December 2013 AIM-AG 8 Consumer Preferences for Tennessee Beef Research Report 9 10 Participant Assessments of the 2014 Value-Added Beef Conference Initial Considerations for Starting a Livestock Harvesting and Processing Facility Jensen, Leffew and Menard Date June 2012 May 2013 CPA Info #220 Holland and others May 2014 CPA Info #221 Holland and Pepper May 2014 Holland, Loveday and June How Much Meat to Expect from a Beef Carcass PB Improving Communications with Your Beef Processor PB 1820 Holland and Loveday August 2014 PB 1821 Leffew and Holland July 2014 SP 773 Pepper and Valerie Bass December General Guide to Marketing Live Animals for Custom-Exempt Harvesting and Processing Understanding Beef Checkoff and State Beef Promotion Assessments General License and Labeling Guidelines for Marketing Pet Food and Pet Treats as Animal Feed in Tennessee Budgeting for a Small-scale Tennessee Value-Added Beef Marketing Enterprises Marketing Locally Raised Beef: Lessons Learned from ValueAdded Beef Product Focus Group Consumer Preferences for Tennessee Beef: Results of a Consumer Survey PB 1832 Ferguson Holland, Pepper, Leffew and Critzer July 2015 Peer Review Pepper and Leffew September 2015 PB 1834 Leffew September 2015 PB 1835 Leffew September 2015 University of Tennessee Institute of Agriculture 13

16 Benefits Being able to sell directly to the consumer has allowed us to increase our gross income per animal by about $2,000. Benefit: Economic Impact The Tennessee Value-Added Beef Program has positively impacted farm incomes. Beef producers report that increasing value-added beef sales has increased processor business sometimes resulting in additional shifts and new employees hired by processors (see text box). This creates real economic impact and value to the broader Tennessee economy. Emma Vernon Lakeland, Tennessee Processor Impacts The economic impact of value-added beef goes beyond higher farm incomes. More cattle harvested in Tennessee creates more opportunities for Tennessee processors. Take John Mitchell, who sold beef from 15 to 20 dairy steers at Knoxville area farmers markets in Mitchell gained a new account requiring 800 pounds of ground beef per week in 2013, tripling the farm s volume with its processor. Dave Turner, of Claybrook Farms, reports his beef processor adding more employees to support Claybrook Farms processing. A USDA Value-Added Producer Grant awarded to Claybrook Farms included funds to develop cattle processing infrastructure, benefiting Claybrook and other West Tennessee farms. Starting in 2011, Center for Profitable Agriculture staff saw more interest in expanding custom exempt and USDA-inspected cattle processing in Tennessee. The Value-Added Beef Program helped improve information and decision aids to individuals and groups interested in establishing new processing facilities. Claybrook Farms owner Dave Turner (left) reported his business resulted in greater volume at his processor and economic opportunities for other local farms. Also pictured: Randy Locke (center) and Michael Rice (right) of Claybrook Farms Meat Co. 14 University of Tennessee Institute of Agriculture

17 Summary of the Tennessee Value-Added Beef Program ( ) Benefit: Collaborative Networks The Value-Added Beef Program brought together groups directly involved in marketing Tennessee beef producers, processors, federal and state regulators as well as educators and researchers. Networks established between these groups are already paying dividends, as educational outreach for a 2014 on-farm poultry processing project drew upon relationships established during the Value-Added Beef Program. Benefit: Establishing a Meat Marketing Outreach Model The Value-Added Beef Program established a model for market research and outreach education related to other livestock and poultry enterprises. Program design and implementation is not the only area that benefits from the success of the Value-Added Beef Program: many farmer clients are also interested in direct marketing other species, as indicated by evaluations collected in 2014, at the inaugural Value-Added Beef Conference. Benefit: Market Opportunities for Beef By-products Tennessee s beef producers are very interested in finding new products to add value to each animal. One unintended result of the Value-Added Beef Program was discovering markets for pet food and pet products, including: Bones Liver and liver jerky Raw beef pet snacks University of Tennessee Institute of Agriculture 15

18 Future Tennessee value-added beef entrepreneurs report that sales continue growing. Outreach and education needs that emerge as Tennessee s value-added beef market channels mature and diversify include: Market studies and outreach for other species Beef producers say their consumers are usually interested in buying other meats. This presents the opportunity for market studies and outreach specific to other animal agriculture products especially determining how other species complement value-added beef products. Tools focused on cost analysis Managing costs is essential to business growth. Beef producers need decision aids to help them analyze costs specific to beef marketing as well as tools to help evaluate the costs of different beef production systems. Educational outreach for recordkeeping Counting all production costs creates a constant challenge. Value-added beef producers may have additional challenges accounting for various prices per cut and in different market outlets. Outreach is needed, both to provide conceptual foundations and the daily tools for good recordkeeping. Production and marketing (label) claims Value-added meat marketing can introduce many terms meaning different things to different people such as grass-fed, no added hormones, or all natural. There is a need for more investigation into how consumers value these claims, and outreach is needed to better educate producers about what is required to make different claims. 16 University of Tennessee Institute of Agriculture

19 Summary of the Tennessee Value-Added Beef Program ( ) Summary and Conclusions The Value-Added Beef Program responded to a clear need from Tennessee cattle producers for research and education about harvesting and marketing beef. Beef consumer market research and outreach focused on all aspects of marketing value-added beef. Producer outreach included market research and financial analysis, as well as how to meet regulatory requirements and develop relationships with processors. Beef harvest and marketing in Tennessee increased from 2011 to 2015 as a result of the Value-Added Beef Program. The number of freezer beef operations listed on the Pick Tennessee Products website increased from 80 to 118, and the number of farm-based retail meat permits issued by TDA increased from 57 to 142 through May The program not only helped increase beef volume marketed directly from farms to consumers; it also informed individual and cooperative efforts to provide higher volumes of Tennessee beef to food retailers and restaurants. This increase gave opportunities to additional farms for finishing beef cattle, as well as increasing sales volumes and diversifying market channels for farms already engaged in value-added beef marketing. Such increases also provided larger volume opportunities for Tennessee beef processors. The Value-Added Beef Program s extensive and diverse outreach effort more than 60 educational events with nearly 2,000 participants from 2011 to 2015 established a foundation for providing next-generation decision and farm management tools to current value-added beef entrepreneurs in Tennessee. The market research conducted in the program, particularly the research funded through the USDA/FSMIP project, points to areas of future market research that could benefit the state s current and future value-added beef marketers. The number of freezer beef operations listed on the Pick Tennessee Products website increased from 80 to 118, and the number of farmbased retail meat permits issued by TDA increased from 57to 142 through May The program also established a collaborative network and working model for marketing outreach and education focused on other livestock and poultry species. Consumer interest is continuing in Tennessee-raised meat. The Value-Added Beef Program establishes a basis for educators and agencies to provide producers with research and information helping farms satisfy that consumer demand. University of Tennessee Institute of Agriculture 17

20 This report has been prepared for the Tennessee Value-Added Beef Program which is supported in part by funding from the sale of agricultural specialty license plates (the Ag Tag ). Funds received from Ag Tag sales are returned to the agricultural community in the form of grants for youth programs, marketing development projects and other agricultural activities. State funds for this project were matched with Federal funds under the Federal-State Marketing Improvement Program of the USDA Agricultural Marketing Service, U.S. Department of Agriculture. The Tennessee Value-Added Beef Program is also supported in part by UT Extension and the Center for Profitable Agriculture. 18 University of Tennessee Institute of Agriculture AG.TENNESSEE.EDU Programs in agriculture and natural resources, 4-H youth development, family and consumer sciences, and resource development. University of Tennessee Institute of Agriculture, U.S. Department of Agriculture and county governments cooperating. UT Extension provides equal opportunities in programs and employment.