New mindset needed? Earls is just the ‘tip of the iceberg’

Consumers are starting to call the tune about how cattle are raised, 
and the sector needs to respond, say industry observers

Consumers are demanding sustainable beef and many want it sooner rather than later.

That’s a key lesson from the Earls Restaurant controversy — and evidence producers need to change their thinking, say experts.

Sylvain Charlebois

Sylvain Charlebois

“The first thing the cattle industry has to do is stop believing that there is no money to be made with niche markets. There is money to be made,” said Sylvain Charlebois, one of Canada’s most well-known experts on the food industry.

“The second thing the industry has to do is come up with a strategy. Define what sustainable beef means and execute a strategy as quickly as possible.”

Earls’ controversial (and since reversed) decision to source Certified Humane beef from the U.S. shows that consumer trends move quickly — but the beef industry has trouble keeping up, said Charlebois, dean of the faculty of management at Dalhousie University.

The Canadian Roundtable for Sustainable Beef, formed in 2014, is reviewing the criteria developed for McDonald’s “verified sustainable beef,” but isn’t expecting to complete that job until 2017. That means it will be 2019 before cattle raised under those protocols head to slaughter.

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“Consensus building has been challenging for the roundtable — the first thing we need to do as a country is agree on what sustainable beef actually means,” said Charlebois.

Dave Andrews, a Brooks rancher and well-known figure in the beef sector, agrees the process may be moving too slowly, but he’s not going to fault the roundtable for that.

“It’s a big project,” he said. “I’m not critical of the roundtable for being too slow. Resources are finite and it’s not inexpensive to develop a program like this.”

Andrews is one of the authors of the seminal 2014 “straw man” report that urged the beef industry to work together to capitalize on Canada’s ability to produce high-quality beef. That included a call “to provide both domestic and international customers with a dependable supply of quality beef that meets their specific needs and expectations.”

But so far, the market signals for specialized beef programs for companies like Earls have not been “vigorous” enough, he said.

“This is a market-based industry — it responds to price signals,” said Andrews. “I don’t think that the market opportunity has been clearly demonstrated to be profitable at this point in time.

“It’s not that hard to do if the price signals are there.”

Producers are “looking very carefully” at the market potential, but so far the number of buyers like Earls is few and far between, he said. And while Europe is a potentially lucrative market and wants beef raised without growth promotants, it imposes tariffs and quotas to keep out imports.

Looking ahead

But ranchers like Colleen Biggs are already doing what Charlebois recommends by chasing niche markets.

The high prices for cattle in recent years shouldn’t lull producers into a false sense of security, said Biggs, who produces ‘natural’ beef with husband Dylan at TK Ranch near Hanna.

She likens the cattle business to the oil industry, and fears what would happen if prices suddenly plummeted.

“We’re doing OK right now, but heaven forbid… we had some strong years and the market has just one direction to go now,” she said.

“That’s the primary reason we got involved. We couldn’t survive in the industry by just selling our calves in the fall. There wasn’t enough cash. The more markets we have for our livestock, the more stable the overall agricultural industry will be.”

The Biggs, who will soon be opening their own abattoir near Calgary, raise grass-fed beef, lamb, and pasture-raised pork under the Certified Animal Welfare label, which is even more stringent than the Certified Humane brand.

There is an opportunity for beef producers to come together to market naturally raised animals, but there’s a major roadblock, she said.

Raising, assembling, processing, and certifying cattle under special protocols isn’t difficult, but things fall apart when the meat goes further along the value chain, she said. For beef to retain its certification, warehouses and coolers need to be federally inspected and certified as well.

Andrews agrees that’s a problem today, but said it can be overcome with the right technology. However, that will take a change in attitude, he added.

“What producers need to understand is they (retailers, restaurants and customers) are not just buying meat anymore,” he said. “They’re actually buying cattle from primary producers. They’re buying cattle from me indirectly. They’re not some shadowy retailer way out there at the other end of the value chain. They’re coming down to my place and they’re looking for cattle to satisfy their consumers.

“That’s what producers need to get through their heads.”

Neither A&W’s move to “better beef” or Earls’ decision should be viewed as a “one-off,” he warned.

“You can bet your boots it’s not — this is just the tip of the iceberg,” said Andrews. “As cattle people from the rancher right through to retail, we need to understand what it is that will drive consumers to buy our product.

“And we need to make sure that we can supply what it is they want.”

About the author

Reporter

Alexis Kienlen

Alexis Kienlen lives in Edmonton and has been writing for Alberta Farmer since 2008. Originally from Saskatoon, she has also published two collections of poetry and a biography about a Sikh civil rights activist. Her freelance work has appeared in numerous publications across Canada.

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