Beef reads into the headlines

Beef reads into the headlines


Why cattle producers should stay on top of megatrends.


BY 2020, health related expenditure in Australia is expected to overtake the spend on restaurants and hotels.

Meanwhile, incomes are growing fast in Asia.

Dishonest companies are being exposed online.

Consumers are looking for country of label origins on food packaging.

And the plethora of competing sources of information means nobody knows what or who to trust.

As inconceivable at it may seem, these apparent peripheral tidbits all have quite the potential to influence the future fortunes of the Australian cattle producer.

Demand for red meat is a factor of so many variables and megatrends suggest both threats and opportunities, according to marketing experts.

Understanding, monitoring and, where required, repositioning our product in response to global trends will be critical to red meat’s prosperity, says Meat and Livestock Australia’s chief marketing and communications officer Lisa Sharp.

Her role involves making sense of the headlines in terms of the implications to red meat.

In a entertaining talk at this year’s MLA annual general meeting in Alice Springs, Ms Sharp outlined five key megatrends and how they feed into what cattle producers, and those further up the beef supply chain, need to be doing.

More for less: The earth has limited supplies of natural resources - energy, water, food - and numerous sets of data reveal these resources are being depleted, she said.

“At the same time, we have population and income growth putting upward pressure on demand.

“This megatrend exposes how governments, companies and communities are finding new ways of ensuring quality of life within the confines of limited resources.”

MLA research shows consumers are looking for “natural” meat - that is beef produced with minimal human intervention.

“This desire is not just limited to wealthy or developed nations - our global consumer tracker shows around a fifth of consumers across quite diverse markets are seeking ‘natural’,” Ms Sharp said.

“Consumers are also concerned about the human impact on the natural environment, concerns that link into farming practices.”

In beef, areas where this trend is likely to impact include efficiency in on-farm management, sustainable practices, yield from animal and leveraging everything the animal produces - including manure, according to Ms Sharp.

Meat and Livestock Australia’s chief marketing and communications officer Lisa Sharp.

Meat and Livestock Australia’s chief marketing and communications officer Lisa Sharp.

Great expectations: Demand for experiences over products and the importance of social relationships is on the rise.

As part of this trend, consumers are demanding transparency.

“Consumers are demanding companies be honest and responsible and they have ways to expose those not doing so,” Ms Sharp said.

“Food apps are one way this trend is playing out, allowing consumers to know more about the food and who is producing it.”

The takeaway - what your social media profile says about you can be just as important as the physical product you are offering.

Silk highway: Rapid income growth in Asia, and to a lesser extent South America and Africa, will see billions transition out of poverty and into middle income classes.

This economic shift will build new trade relations, export markets and business models.

“We have finite supplies of red meat and we are a small player globally so we need to identify the best markets,” Ms Sharp explained.

Realising the opportunity in any market is linked to the consumer’s ability to purchase, she said.

The correlation between income growth and protein consumption is well-established - US$35,000 per annum is the point at which discretionary purchasing and regular protein consumption occurs.

In three years, the number of middle or higher income households in China will be double that of Australia.

“Equally, we have to identify the ‘attractive cities’ so we can better understand local factors, such as the retail and food service structure, competitive intensity and local cuisine types, cooking methods - even the size of fridges and kitchens - to ensure we supply the right cut in the right format,” Ms Sharp said.

Forever Young: The aging population will mean more spending on healthcare and less on restaurants and hotels - two very lucrative channels for Australia red meat.

Our other major markets such as Japan, Korea and China are also walking down this path, Ms Sharp reported.

“We need to link red meat’s brand image with health messages and explore value added opportunities targeting older and wealthier consumers,” she said.

Fear, uncertainty and doubt: This trend started with the 2001 terrorist attacks in the US and was exacerbated by the global financial crisis.

“We lost confidence in governments and institutions,” Ms Sharp said.

“In response, individuals are focussing on what they can control.”

One way this trend is playing out: A 2016 CSIRO study showed an increasing number of consumers are using pack labels to drive purchases and 35pc felt country of origin was the most important piece of information.

That combines beautifully with Australian beef’s paddock to plate traceability and integrity.

It’s a constant message we need to be promoting.

The story Beef reads into the headlines first appeared on Farm Online.


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