Red Meat - US - December 2008

Table of Contents

• Scope and Themes What you need to know
• Definition
• Data sources
• Sales data
• Consumer data
• Abbreviations and terms
• Abbreviations
• Terms
• Executive Summary
• Challenges abound
• Foreign trade helps U.S. suppliers sell more
• Restaurants compete for shrinking food dollars
• Declines in 2005 set market back for years
• Economy and food budgets shrink
• Changing health trends affect both amount and type of red meat demand
• Recalls keep beef in the news
• Beef packing consolidation continues and draws fire
• FDM frozen and refrigerated red meat
• Innovations benefit producers and consumers
• Consumer usage and preparation of red meat
• Consumer purchasing and knowledge
• Consumer attitudes toward meat
• Black respondents' views on beef differ from whites' and Hispanics'
• Hispanics hold "greener" views on meat
• Market Size and Forecast
• Key points
• Diet trends, food safety concerns affect sales
  • Figure 1: Total U.S. sales and forecast of red meat, at current prices, 2003-13
  • Figure 2: Total U.S. sales and forecast of red meat, at inflation-adjusted prices, 2003-13
• Wal-Mart sales
• Competitive Context
• Key points
• Prices influence choice of meat
  • Figure 3: Protein sources' retail and wholesale prices, 2003-09
• Per capita consumption of beef on the decline, while pork rises slightly
  • Figure 4: Per capita red meat consumption, 2006 and 2008
• Geopolitical matters impact foreign trade activity
• Red meat imports on the decline due to labeling requirements and low supply
  • Figure 5: Beef and veal imports, 2005-07 and January-September 2007 and January-September 2008
• Exports struggling to top pre-2003 levels
  • Figure 6: Beef and veal exports, 2005-07 and January-September 2007 and January-September 2008
• Import levels of Mexican pork in jeopardy
  • Figure 7: Pork imports, 2005-07 and January-September 2007 and January-September 2008
• Relations with Mexico and Russia have potential to affect pork exports
  • Figure 8: Pork exports, 2005-07 and January-September 2007 and January-September 2008
• Restaurants and retail competing for food dollars
• Competing with a meatless lifestyle
• Segment Performance
• Key points
• Market has yet to recover from 2005 setback
  • Figure 9: U.S. sales and forecast of red meat at current prices, by segment, 2003-13
  • Figure 10: U.S. sales of red meat, by segment, 2006 and 2008
• Segment Performance--Beef
• Key points
• BSE setback and recalls continue to hamper growth
• Muscle cuts slightly outweigh ground beef
• Price increases drive sales
  • Figure 11: U.S. sales and forecast of beef, 2003-13
• Segment Performance--Pork
• Key points
• Lower demand and prices
• Several new natural pork lines introduced
  • Figure 12: U.S. sales and forecast of pork, 2003-13
• Segment Performance--Other Meats
• Key point
• Lunchmeat gains dampened by mutton/goat/game declines
  • Figure 13: U.S. sales and forecast of other meats*, 2003-13
• Retail Channels
• Introduction
• Key point
• Supercenters grab share from supermarkets
  • Figure 14: U.S. retail sales of red meat, fish, and poultry, by retail channel, 2006 and 2008
• Retail Channels--Supermarkets and Specialty Food Stores
• Key points
• The $10 meal
• Promoting private label meat
  • Figure 15: U.S. sales of meat, fish/seafood, and poultry at supermarkets and specialty food stores, 2003-08
• Retail Channels--Supercenters and Warehouse Clubs
• Key points
• Strong sales for low price destination
• Dinners under $10 and daily meal suggestions online
• Supercenters downsize
  • Figure 16: U.S. sales of meat, fish/seafood, and poultry at supercenters and warehouse clubs, 2003-08
• Retail Channels--Packaged Red Meat Only
• Key point
• Share smaller but growth in mass channels still evident
• Private labels versus case ready in refrigerated meat section
  • Figure 17: FDMx sales of packaged red meat, by retail channel, 2006 and 2008
  • Figure 18: FDMx sales of packaged red meat at food stores, 2003-08
  • Figure 19: FDMx sales of packaged red meat at drug stores and mass merchandisers, 2003-08
• Market Drivers
• Key points
• Economy tightens food budgets
  • Figure 20: Seasonally adjusted unemployment rate, 16 years and older, by month, 2000-08
• Beef recalls affect more than beef
• Demand for natural and organic meat drives pricing
• Leading Companies
• Key points
• Consolidation of beef industry continues
• Shortages of kosher beef
• High feed prices making meat production unprofitable
• Major suppliers
• Tyson Foods Inc.
• Cargill Meat Solutions
• Smithfield Foods
• Swift & Company
• Natural and organic producers
• Coleman Natural Foods
• Laura' s Lean Beef
• Niman Ranch
• Brand Share--FDMx Sales Of Refrigerated And Frozen Packaged Meat
• Introduction
• Key points
• Recalls affect largest FDM supplier
• Natural suppliers' sales jump
• Mid- and value-priced branded frozen meats grow
  • Figure 21: FDMx brand sales of refrigerated and frozen packaged meats in the U.S., 2007 and 2008
• Brand Qualities
• Key points
• Bubba Burger
• Innovation and Innovators
• New cuts of beef with catchy names lure cash-strapped consumers
• Angus comes to private label
• Gluten-free
• Uncured increasingly appearing
• Advertising and Promotion
• Key points
• Message: Red meat as a luxury
  • Figure 22: Omaha Steaks television ad, 2007
  • Figure 23: Certified Angus Beef television ad, 2008
• Message: If it' s not quick, at least it' s easy to prepare
  • Figure 24: H.E.B Fully cooked Brisket television ad, 2007
• Message: Red meat can be healthy
  • Figure 25: Yama Beef television ad, 2008
• Message: New cuts mean steak is still an option even when money' s tight
• Usage
• Key point
• Despite rising prices, red meat is a key part of most diets
  • Figure 26: How often red meat/poultry/fish/seafood are eaten, by type, September 2008
• Dollar and value menus may beat out cooking burgers at home
  • Figure 27: Incidence of household use of red meat, by household income, April 2007-June 2008
• Consumers shy away from cooking trial and error with expensive cuts
  • Figure 28: Types of red meat eaten, at home vs at restaurants, September 2008
• Older adults more likely to include red meat in their meals at home, but not when dining out
  • Figure 29: Average number of meals eaten per month that include red meat, at home vs at a restaurant, by gender, age, race/Hispanic origin, region and presence of children, September 2008
• How Meat is Prepared
• Grilling is preparation of choice for beef
  • Figure 30: How red meat/poultry/fish/seafood is prepared, by type, September 2008
• Men prefer the grill and the microwave for preparation
  • Figure 31: How beef is prepared, by gender, September 2008
• Older consumers more likely to prefer their meat medium rare
  • Figure 32: Preferences for red meat doneness, by age, September 2008
• Purchase and Consumption
• Female shoppers suffer sticker shock
  • Figure 33: Purchase and consumption behaviors regarding red meat, by gender, September 2008
• Younger consumers need to see the benefits of eating red meat
  • Figure 34: Purchase and consumption behaviors regarding red meat, by age, September 2008
• Celebrity tie-ins may help to educate consumers
  • Figure 35: Purchase and consumption behaviors regarding red meat, by household income, September 2008
• Attitudes and Motivations
• Older consumers least confident in safety of food supply
  • Figure 36: Attitudes regarding red meat and food safety, by age, September 2008
• Chicken cited as posing greatest risk of causing illness
  • Figure 37: Attitudes and opinions regarding red meat/pork in comparison to other meat types, September 2008
• Race and Hispanic origin
• Key points
• Whites significantly more likely to use beef
  • Figure 38: Incidence of household use of red meat, by race/Hispanic origin, April 2007-June 2008
• Black respondents' preference for oven cooking may be tied to quality of meat
  • Figure 39: How beef is prepared, by race/Hispanic origin, September 2008
• Black respondents much more likely to prefer their meat "well done"
  • Figure 40: Preferences for red meat doneness, by race/Hispanic origin, September 2008
• Hispanics more open to meat alternatives
  • Figure 41: Purchase and consumption behaviors regarding red meat, by race/Hispanic origin, September 2008
• Black respondents not convinced that red meat is a healthy option
  • Figure 42: Attitudes regarding health, diet and red meat, by race/Hispanic origin, September 2008
• Black respondents least likely to doubt safety of food systems
  • Figure 43: Attitudes regarding food safety and environmental concerns, by race/Hispanic origin, September 2008
• Appendix: Other Useful Consumer Tables
• Household consumption of red meat
  • Figure 66: Incidence of household use of red meat, by age, April 2007-June 2008
• Attitudes regarding health, diet and red meat
  • Figure 67: Attitudes regarding health, diet and red meat, by age, September 2008
• Attitudes regarding red meat and the environment
  • Figure 68: Attitudes regarding red meat and environmental concerns, by age, September 2008
• Appendix: Lamb and Mutton Imports/Exports
• Lamb
  • Figure 69: Lamb imports, 2005-07 and January-September 2007 and January-September 2008
  • Figure 70: Lamb exports, 2005-07 and January-September 2007 and January-September 2008
• Mutton
  • Figure 71: Mutton imports, 2005-07 and January-September 2007 and January-September 2008
  • Figure 72: Mutton exports, 2005-07 and January-September 2007 and January-September 2008
• Appendix: Trade Associations