State Beef Councils Talk Checkoff Compliance

Every time a bovine animal is sold, the $1-per-head beef checkoff is due. That includes sales of a single animal to a neighbor, or even freezer beef. Compliance with payment of that assessment is monitored through audits of collecting points, advertised sales, and various other collection techniques, and state beef councils responsible for collecting that dollar are meeting today to talk about how to improve that system.

Thirty staff members for state beef councils across the country are gathered in Denver this morning to work with each other and Beef Board staff to share and come up with ideas for reducing non-compliance. And the ideas are already flowing.

Producer communications will be part of the picture, as well, as the Joint Producer Communications Committee has asked for more emphasis on “compliance messages” in the national producer communications program in Fiscal Year 2012.

The message is this: Buyer and seller are responsible for seeing that the checkoff assessment is paid on every sale. If it’s not paid now and identified later in an audit or other compliance effort, stiff penalties can be attached, on top of full back payment. Need a refresher on the rules? Go to Who Pays the Checkoff?

Committee Approves Checkoff Plan of Work

The Cattlemen’s Beef Board will invest about $39.8 million, from a total budget of about $42.1 million, into programs of beef promotion, research, consumer information,  industry information, foreign marketing and producer communications in Fiscal Year 2012, if the recommendation of the Beef Promotion Operating Committee is approved by USDA, following review by the full Beef Board.

In action concluding its two-day meeting in Denver, the Operating Committee — including 10 members of the Beef Board and 10 members of the Federation of State Beef Councils — approved checkoff funding for a total of 39 “Authorization Requests,” or proposals for checkoff funding in the fiscal year beginning Oct. 1, 2011. The committee also will request full Board approval of a budget amendment to reflect the recategorization of the FY2012 budget in accordance with the programs approved. 

National organizations that had proposals approved by the Operating Committee (and the number of proposals and dollar amounts approved) are as follows: National Cattlemen’s Beef Association (19 programs totaling $30.2 million); U.S. Meat Export Federation (13 programs totaling $6.38 million); Cattlemen’s Beef Board (one program totaling $1.8 million); American National CattleWomen (two programs totaling $483,360); Meat Importers Council of America (three programs totaling $475,000); and the National Livestock Producers Association (one program at $35,000).

Based on the grim outlook for checkoff collections in the next few years (see post below), the Operating Committee voted to leave about $1.2 million “unallocated” to lessen the extent of the blow looking forward to Fiscal Year 2013 and beyond.

Broken out by budget component, the Fiscal Year 2012 Plan of Work for the Cattlemen’s Beef Board budget includes:

• $17.8 million for promotion programs
• $5.8 million for research programs
• $4.4 million for consumer information programs
• $3.1 million for industry information programs
• $6.4 million for foreign marketing programs
• $1.8 million for producer communications

Other categories funded through the 2012 CBB budget include $225,000 for evaluation, $180,000 for program development, $250,000 for USDA oversight; and about $2 million for administration, which includes costs for Board meetings, legal fees, travel costs, office rental, supplies, equipment, and administrative staff compensation. Fiscal Year 2012 begins Oct. 1, 2011.

Tough Times Ahead

“You can’t keep buying yourself out of a drought.”

That sentiment was voiced by Texas cattlewoman and Operating Committee member Linda Joy Stovall and other producers, as this morning’s portion of the Beef Promotion Operating Committee meeting kicked off with discussion of the tremendous impact that drought is having on the beef industry, particularly in Texas and Oklahoma.

Speaking of the “upshot,” Beef Board and Operating Committee member Chuck Kiker, noted: “I think consumers are going to get a whole new appreciation of the food industry in the next 10 or 12 years, because they’ll see the effect in increase in food prices.”

Beef Board member Dan Dierschke, who ranches near Austin, Texas, in the heart of the worst drought on record, echoed those sentiments, noting that cattlemen in the area are giving up on their generations-long businesses in large numbers. It’s clearly a very sad situation.

Discussion of this issue amounted to Operating Committee members reminding themselves of the outlook for the checkoff budget down the road, and the associated importance of planning ahead for even tougher times for the checkoff, in particular, and the beef industry, in general.

The committee is now voting on Authorization Requests for checkoff funding in Fiscal Year 2012, so we’ll get you details about the plan of work for the coming year here shortly.

Talking Beef With Consumers

In the home stretch of Authorization Request presentations this afternoon, NCBA presented proposals for checkoff funding of Promotion and Consumer Information programs in Fiscal Year 2012.

In presenting a $789,811 “Nutrition Influencer Program” proposal from NCBA, nutrition information program director Julie Sodano (pictured, presenting, right) talked about the important role that the checkoff plays in distributing information about the nutritional qualities of beef to today’s consumers. Having the research in hand from checkoff-funded research programs (see below) is a start, but getting that information to consumers is critical for it to be effective.

Along the same lines, the public relations AR, supported through the Consumer Informaiton budget component, along with the nutrition influencer program, gets the good word about beef out to consumers nationwide through national press releases, magazines, desk-side visits, and the like. View the Nutrition Influencer and Public Relations proposals, and visit Consumer Information Implementation to see the proposed costs associated with managing these two programs by NCBA.

In the area of Promotion, NCBA is presenting proposals today for Consumer Advertising, New Product and Culinary Initiatives, Retail Marketing, Foodservice Marketing, and Veal Marketing and Communications. For the costs associated with implementing those promotion programs, visit Promotion Implementation.

Research at Base of Checkoff Program

Consumer insights about beef and the beef ‘eating experience’ provide critical links to all other checkoff program efforts to build consumer demand for beef. After all, if the beef industry isn’t constantly adapting to meet consumers’ changing needs, then demand will nosedive. That’s the basic tenet for checkoff investment in consumer market research, via an Authorization Requested presented by market research director John Lundeen to the Operating Committee this afternoon.

Market research director John Lundeen presented the associated $1.35 million market research “Authorization Request” for checkoff funding in Fiscal Year 2012. Tactics/research topics included in the proposal include foundational product research; channels of distribution; new product development; enhancing the beef experience; tracking through the Consumer Beef Index; beef industry image; consumer barriers to eating beef; highlighing safety successes and perceptions; and eating personality validation. For details on the proposal, up for vote by the Operating Committee tomorrow morning, visit Market Research 2012.

Also in the research arena, NCBA is presenting Authorization Requests in the amount of $940,000 for beef safety research; product enhancement research; and human nutrition research. NCBA’s “implementation” AR (covering the costs associated with managing these research programs) is available at Research Implementation.

NCBA Presents Industry Information Proposals

After a hearty beef lunch, Operating Committee members are back at it this afternoon, and have begun listening to presentations from NCBA staff of Authorization Requests in the areas of promotion, research, consumer information and industry information.

Ryan Ruppert is kicking things off with a presentation of Beef Quality Assurance Programs proposed for checkoff funding in Fiscal Year 2012. Among highlighted new or improved tactics in the plan of work for the coming year are BQA training sessions for livestock marketing representatives, aimed at getting buy-in from all segments of the industry to include responsible practices from farm to slaughter, thus resulting in higher-quality beef and strong consumer confidence in beef and beef products. In addition, the BQA staff intends to increase its coordinated advertising efforts with producer communications staff by more than 25 percent. 

All told, the BQA program proposals seeks $800,000 in checkoff funding for FY12. Among elements in the program, funded through the Beef Board’s Industry Information budget component, are tactics to increase producer use of BQA; a national residue avoidance campaign; development and refinement of BQA management protocols; and an industry education campaign to avoid animal abuse and neglect. Next on the Operating Committee agenda today is presentation of “issues and reputation management” proposals, also funded through the Industry Information component. The “implementation AR” submitted for these Industry Information programs by NCBA is available at II Implementation.

Producer Communications & More

CBB Vice President of Communications Lynn Heinze (pictured) has completed his presentation and question-and-answer session with the Operating Committee, mapping out a FY2012 Plan of Work for producer communications funded through your national Beef Checkoff Program.

The main change in the producer communications plan for the coming year, compared to that occurring in FY2011 is an increased emphasis on regional advertising, including print, radio and online, to increase checkoff messages in areas that surveys indicate are home with producers who have less understanding of how the checkoff operates on their behalf, Heinze said. That will include regional programs in the Southeast, Northeast, Northwest, and Texas, primarily.

Another change, as prescribed by a recommendation from the Joint Producer Communications Committee, includes increase focus on messages about checkoff compliance, helping producers understand that the reason the checkoff is successful is because all producers and importers must pay the $1-per-head or equivalent assessment. That, said Heinze, is based on a request from state beef councils, and from research that indicates there are still some 15 percent of producer who say they’ve never heard of the checkoff.

Following the producer communications presentation, Sherry Hill of the American National Cattlewomen, presented a plan of promotion for the National Beef Cook-Off, and Sarah Bohnenkamp, also of ANCW, now is presenting a proposal for a “Telling the Beef Story” program, including the National Beef Ambassador Program.

Coming up next are presentations from the National Livestock Producers Association for checkoff assistance in funding a national forum about animal antibiotics, and proposals from the Meat Importers Council of America for another year of the Northeast Beef Promotion Initiative, which comprises foodservice and retail promotions, as well as consumer public relations regarding beef in the heavily populated Northeast corridor of the country.

(All above proposals include implementation costs, or the cost of managing the programs, within the amount requested.)

Foreign Marketing Kicks Off Funding Meeting

The Beef Promotion Operating Committee meeting is under way in Denver this morning. As every September, when proposals for checkoff funding of programs in the coming fiscal year, this promises to be heavy on information, with a day and a half schedueld for review of a total of 58 proposals.

Today, members of the Operating Committee — 10 members of the Cattlemen’s Beef Board and 10 members of the Federation of State Beef Councils — will hear presentations on 38 “Athorization Requests,” (ARs) or proposals for checkoff funding, in the areas of promotion, research, consumer information, industry information, foreign marketing and producer communications. Another 20 “Attachment A’s” map out “next-priority” proposals in the case that additional checkoff funding is available after the committee recommends the main ARs it believes should be funded. 

No voting on the ARs will take place today — that happens tomorrow.

The total amount requested in checkoff funding for Fiscal Year 2012 is $42.2 million, compared to an available budget of $40.6 million, so not everything presented can be funded. Fiscal Year 2012 begins Oct. 1, 2011.

National beef organizations presenting proposals, and the number of proposals and dollar amount requested, are as follows:

• National Cattlemen’s Beef Association, 35 proposals for $30.41 million
• U.S. Meat Export Federation, 15 proposals for $6.75 million
• American National Cattlewomen, two proposals for $1.72 million
• Cattlemen’s Beef Board, one proposal (producer communications), for $1.8 million
• Meat Importers Council of America, four proposals for $515,000
• National Livestock Producers Association, one proposal for $35,000

First up on the presentation block today is foreign marketing, and USMEF’s Greg Hanes is currently talking to the Operating Committee about how that organization wants to manage the checkoff’s international marketing efforts in the coming year. (For the individual foreign-marketing proposals, by country, visit Countries and scroll down to the “Foreign Marketing” section.) For proposed implementation costs, or the checkoff costs associated with managing these programs, is available at Foreign Marketing Implementation.

Stay tuned….