Analysis: Where next for beef grading?

The beef chain must become much more transparent, AHDB’s major research into the sector has concluded.

While that thought was hardly novel, the three-part study, carried out over the summer, did show clear evidence of where farmers, abattoirs and retailers might be going wrong.

The levy board found a significant number of beef cattle exceeded the 380kg weight limit, or missed the supermarket spec.

Grid changes introduced last winter also knocked 7% off the value of the monthly cattle kill and the value of the grid now falls away much more sharply outside the ideal range.

Farmers were seeing returns fall, while processors were not getting the carcasses they needed, AHDB market intelligence specialist manager Stephen Howarth said.

See also: Beef slaughtering ‘monopoly’ costing farmers money

“A more transparent environment, allowing more positive, open relationships to develop across the supply chain, would potentially benefit everyone,” he added.

We have heard such calls before, like when the sector’s voluntary code was launched after a beef crisis summit in 2014. So, can one more report change anything?

The biggest processors were initially frustrated with the study, Farmers Weekly understands, but they found the conclusions more balanced, and some now want to have better conversations with producers.

The directors of 2 Sisters, ABP and Dunbia had their say at Westminster on Wednesday 14 September (see “Processors face questions”).

“I think there will be more of a dialogue between farmers and processors,” one insider said.

Tensions tend to ease, between producer and abattoir, when beef prices rise. From a trough of 311p/kg in late April, the British all-steers average broke the 350p/kg barrier at the end of August.

But long-term challenges, such as falling red meat consumption and retailer demand for smaller pack sizes, still need collaboration.

NFU chief livestock adviser John Royle said more integrated supply chains, with contracts or dedicated farmer groups, were an option, but longer notice periods to help farmers react were essential. “It is about giving people signals about where we are going in 12 months’ time, not 12 weeks’ time,” he said.

The changes could be more fundamental, such as an overhaul of the Europ grid. Britain’s vote to quit the EU could allow fresh thinking, as the system, in place since the 1970s, is backed by European law.

Australia, for example, grades cattle on eating quality for each cut.

Stuart Roberts, a Hertfordshire beef producer who previously worked for ABP, said he wanted to see new technology used to price meat, based on tenderness, retail meat yield and quality.

“If a carcass is worth more to a consumer, it is worth more to a retailer and more to a processor, and therefore we need to have a better system to reflect this value to the farmer,” he said.

Parts of the trade agree. Norman Bagley, head of policy at the Association of Independent Meat Suppliers, said worries about specs for supermarkets were largely irrelevant, as most of their sales were mince.

Meanwhile, the fastest-growing part of the industry was high-class, catering butchers. “Their high-class restaurant and pub customers are increasingly demanding a much higher quality and a more consistent eating experience, and this is where the growth is,” he said.

See also: Opinion: There’ll be no beef to grade if we carry on like this

“We can achieve that through things like dry-ageing, which is very expensive but doable, or we can look at the tried-and-tested Australian system, which rewards eating quality and should give farmers a better return for high-class cattle.”

The risk is AHDB’s findings are welcomed, but business as usual prevails, like the sudden grid introduction that sparked the investigation.

However the rewards of bold changes could be enormous.