Newspaper article THE JOURNAL RECORD

Beef Industry to Brand Products

Newspaper article THE JOURNAL RECORD

Beef Industry to Brand Products

Article excerpt

NEW YORK -- The U.S. beef industry is following its competitors in the poultry markets with plans to introduce branded products, in a bid to boost consumer demand and industry profits, according to the National Cattlemen's Beef Association.

Faced with losing market share to record supplies of competing meats, coupled with a large cattle herd that will swell beef supplies at a time of declining exports, "the beef industry is moving into the future by enhancing its marketing system," said Clark Willingham, president-elect of the trade association. The association represents the interests of the one million U.S. cattle ranchers and dairy farmers.

Efforts to revamp beef marketing will focus on promoting beef as a brand, ensuring product quality and establishing accountability for the final product, the association said. The move toward branded products comes at a time when the outlook for beef is lackluster, analysts said. "Companies are facing lower profits margins and earnings because beef prices are low and demand is decreasing at a time when there are large inventories and a large cattle herd," said Marjorie Saint- Aime, an equity analyst at Goldis-Pittsburg Institutional Services in New York. "The move to brand beef products is one way that the industry can shore up lower profits," she said. During the first quarter, prices for beef are likely to reach their lowest of the year as supplies of feeder cattle remain large and weights increase, according to Chuck Lambert, chief economist for the NCBA. Prices should stay steady thereafter. Expanding overseas demand for grain-fed beef has fostered growth in U.S. beef exports since the 1980s. In 1996, this demand accounted for 8 percent of total U.S. beef production. Some of the demand could be harmed by the financial and debt problems in Asia. During 1996, about 75 percent of all U.S. beef exports were sold to Asian markets that are now being battered by currency devaluations, economic reforms and recession. In the United States, beef is expected to stay the number one choice of meat among consumers, although they will eat less of it in 1998. …

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