A positive ID: Source verification today
October 3, 2018
In an industry with as much volatility and uncertainty as the beef business, producers are always on the look-out for ways to stay ahead of the trends and to ensure profitability.
Verification programs are one tool ranchers have used to varying degrees, and with varying success over the last ten-plus years. Some programs have focused exclusively on marketing, some on animal health, some on exports or other niche programs. But if it's approached from a value-added standpoint, the one question ranchers must always ask is, "Does it add value?"
Unfortunately, the answer isn't simple.
AngusSource is owned and operated by the American Angus Association. Last fall, they acquired Verified Beef, a verification program in Bozeman, Montana. They're still transitioning Verified Beef customers to the Angus Source program.
AngusSource offers several options for producers
- Age and source verification—certifies the age group and source of calves. The animals must be traceable to the ranch of origin and have records documenting the first calf born that year. A program-compliant AngusSource RFID ear tag is required for enrollment.
- Non-hormone-treated cattle (NHTC) – the cattle can't have received any hormones, whether implants or feed supplements, at any point in their life. This requires an on-site audit before the calves leave the ranch of origin. If hormone growth promotants are used on the ranch at all, the producer must have written records tracking beginning inventory, purchases, use and ending inventory. Any enrolled calves that receive hormones must be removed from the program.
- Age and source plus calf management—This is a program for buyer confidence, which focuses on the preventative health program prior to delivery of the cattle. It is offered as an add-on certification to the other programs.
- Age and source NeverEver3—This verifies that cattle have never received any antibiotics, hormones or animal byproducts. This requires an RFID tag and an on-site audit before the calves leave the ranch.
- Age and source plus care and handling—The goal of this program is to raise consumer confidence by documenting proper management techniques, showing a commitment to quality within the beef industry. Initial enrollment requires an onsite review and audit. This certifies ranches that follow Beef Quality Assurance guidelines for handling cattle.
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Pam Stevens, with C Bar J Ranch, a cow-calf operation near Two Dot, Montana that has been in the family since 1945, says they've been using verified programs for 10 years with Verified Beef. "This helped us establish repeat buyers for our calves, which we feel is one of the most important things about these programs. Buyers have solid information about your calves," she says.
"We use Hereford and black Angus bulls to create black baldy calves. We have qualified for many different programs at buyers' requests. You have to go through an annual audit and have the necessary paperwork, but this hasn't been difficult."
For the last four years they've used an electronic calving book, which allows them easy access to information about which calves are born when, and which ones were born within each period of the calving season, which they use as a selling point.
"We put EID tags in the calves' ears when we brand and vaccinate them. We know what numbers go in each calf's ear, and they stay in very well. Some people put the tags in when they ship calves, but we prefer to install them at branding time. We want to get calves sorted and on the truck as quickly and quietly as possible so we don't do anything extra at that time," says Stevens.
Some programs can point to premiums to highlight profitability, but ambiguity associated with some of the marketing programs has reduced their value. "Natural" beef, for instance, is no longer defined by the USDA, so anyone producing "natural" beef must provide their own definition.
"This is open to interpretation," says Robert Weeks, who has been with Verified Beef for many years. "Some people also think natural means organic, but these are totally different. Organic means the animals have never come in contact with chemicals such as fertilizers or non-organic feeds; their pastures, hay and grain must all be organic, grown without pesticides, herbicides or fertilizers."
"Grass-fed" is another term that isn't clearly defined, so causes some confusion on both the producers' and the consumers' side.
"In some programs grass feed is only necessary for the last 30 days, and in others it means grass fed for the entire life of the animal. There's also a difference between grass-fed and grass finished. This is a marketing term that doesn't have a good definition," Weeks says.
When it comes to marketing the cattle that have gone through the verification programs, Ginette Gottswiller, AngusSource director with the American Angus Association, says their service connects sellers with buyers who are looking for those cattle. "We send out a marketing document that lists the program's producers that are enrolled and the number of calves selling—along with weights of the calves—via e-mail twice a week listing the groups of cattle selling that week. This is helpful for buyers who are interested in certain calves."
The USDA doesn't require RFID tags at this point, but some private programs require them. "This system has been picked up by most of the organizations merely because it makes it so easy to check cattle," Weeks said. "They can be run through a gate with a reader on it and know which cattle went through. Sometimes cattle get comingled inadvertently in a feed yard and can be sorted this way without much effort."
According to Gottswiller, the RFID tags are an important part of the verification process, and most verifications programs are moving that direction. "There are very few verification programs today that don't require an RFID tag. We were probably one of the last programs that had a visual tag. Everyone has gone with RFID tags," she says.
The RFID tags don't inherently add value, according to Kris Ringwall, North Dakota State University extension beef specialist.
"Essentially, two products still remain: the 'calf' and then the associated 'data.' Both products have value, an important point to understand," he writes in a BeefTalk column. "The free marketplace determines calf value, but the value of the information associated with the calf has not been determined."
While the data itself doesn't have a set value, what the data tells buyers sometimes does see premiums.
Weeks said, "For example, at one point non-hormone treated cattle were getting between $12 and $15 per head more than market value. If you had enough cattle involved, you could get your money back by investing in that program. Until Japan decided to relax their standards and no longer required this, the $3 per head for the Age and Source program paid off because typically there was a premium of about $4 per head for having this verification."
Those premiums fluctuate with the market and demand, and regardless of the market, if the buyers don't know what you're offering, you're not going to see the premium.
Gottswiller says, "Currently we have a list of more than 800 buyers who want to know where and when these Angus calves are selling. This increases the number of people bidding on the cattle.
"The sad part is that even though we tell producers to fill out these forms or call and have us fill these out, less than half of them do it, and we don't know when they are selling calves. On video sales we can use the sale listings, but for producers selling at a sale barn we can't help them unless they tell us when they are going to bring in those calves."