Verification programs can be worth the effort
What do California Prop 37, the April debacle over lean fine textured beef, and the ongoing public concern over antibiotic use in livestock have in common? A push for the “right to know” among consumers about food.
With the growing demand for easy information, coupled with the deepening lack of knowledge about modern food production, the popularity of processverified programs among consumers is increasing. This growing consumer trend can have some valuable potential for cattlemen in terms of premiums paid for cattle and increased marketing opportunities.
At its most basic, a process-verification program is one which tracks certain information through the life of an animal and can provide documentation on relevant details on request.
Among the most familiar are age- and source-verified programs, many of which are required for export to certain markets such as Japan or the European Union.
Other programs might be called treatment-verified programs which attend to things like the use of antibiotics, hormones or growth promotants, how the animal was raised, housed or handled, and what and how it was fed.
As of August 2012, there are 34 USDA-approved process-verified programs for livestock and grain. Of those 34, 26 are for cattle, including dairy and veal. Most are through usual, well-known industry names such as JBS, Tyson, Pfizer and Cargill. Other USDA-approved process-verified programs are through academic institutions, state groups or breed associations.
Verification programs are necessary for a number of marketing opportunities. In addition to the aforementioned export opportunities, USDA-regulated specialty food labels such as “organic” or “no added hormones” require verification programs tracking certain details. USDA has recently added a new marketing program along similar lines, called the Never Ever 3 program, which bars the use of antibiotics or hormones, or the feeding of animal by-products to certified livestock.
Jordan Mueller of Samson LLC—a company on USDA’s official list of approved verification programs—spoke at the recent South Dakota State University Extension marketing seminar about some of Samson’s programs and their value. Samson has a number of process-verified programs such as age- and source-verified programs and hormone- and antibiotic-free programs which make animals suitable for several export markets and special labeling.
“The hormone-free program is a verification program for cattle destined for the European Union,” Mueller said. “Basically, what the program certifies is that the cattle have not been given any hormones, hormones including implants, MGA [the heat-synchronizing feed supplement], Optiflex, Zilmax, or Zilpaterol.”
Mueller went on to discuss the premiums available to ranchers and feeders who participate in verification programs like Samson’s hormone-free program.
“Their premiums range on the ranch and can go anywhere from $0 to $50 a head. Generally we see around the $20 a head range from the ranches. The feed yards—if they contract with the packer and get a price locked in or if they’re contracting for prices—we generally see $10 to $12 per hundredweight. That’s roughly a $120 a head premium on the slaughter side.”
He did make a point, however, to explain that premiums based on process-verification programs are not guaranteed, vary from program to program, and are influenced by a number of factors such as geographic location, relative availability of verified cattle, and breed, to name a few.
Verification programs aren’t just for export or grocery store venues, however.
With roughly half of the average American’s food intake coming from away from-home locations, consumers and consumer advocacy groups have pushed for greater information available about food sources at restaurants.
Integrated Management Information—another company on USDA’s official list of approved verification programs—has expanded their Where Food Comes From verification program to New York City’s famous 175-yearold Delmonico’s Steak House.
Customers can now use their smartphones to scan a quick response, or QR, barcode on the menu and read detailed information on the source and background of the beef they order. Information includes brief introductions of the ranch and cattlemen who raised the animals and brief discussion of the verification promises.
Though sometimes the butt of pop-culture jokes, this sort of instantly-available “food story” information is gaining popularity among consumers.
The popularity of verification programs extends far beyond those officially approved by USDA. A plethora of institution-specific process-verification programs exist which serve smaller markets. Such programs are similar in the type of claims made, but come with the “buyer-beware” element of being vetted only through individual groups.
Most of these kinds of verification programs cater specifically to the growing consumer concern over handling and treatment of animals destined to be food. They are smaller in scope than USDA-approved programs and often have a more direct-to-consumer intention.
An example is the 5 Step Program for livestock and poultry conducted by the Global Animal Partnership sold through Whole Foods markets. Another is the Animal Welfare Approved, a third-party certification program which provides participating ranches and livestock operations with its labeling and direct-to-consumer marketing networks.
Just as for consumers, non-USDA-approved verification programs require research and individual trust between the rancher and the program (or the people running the program). While these smaller, individual process-verified programs offer the producer potentially greater access to small niche markets in their area, premiums are largely not to be found as in the USDA-approved programs. — Kerry Halladay, WLJ Editor