Beef Checkoff Export Efforts
Generate Triple-Digit Sales

AUSTIN — The Texas Beef Council says the state’s beef industry has seen triple-digit increases in sales to some Mexican markets thanks to an initiative co-funded by TBC through the $1 per head beef checkoff program and three participating Texas exporting companies.

TBC’s partners included a beef portion-control program, a trader and a beef distribution company, all operating in Texas. Through its Intensified Partnership Initiative, it helped fund programs to teach Mexican foodservice operators how to use and market underutilized U.S. beef cuts.

Bill Tullos of San Angelo, chairman of the TBC export market development committee, praised IPI as a tool to leverage beef checkoff dollars. He said IPI partners pay a growing percentage of the program costs each year.

The partners benefit by having their export business grow. The Texas beef industry benefits by creating new beef consumers and reducing the supply that must be sold in the U.S.

"The program created new demand in Mexico for chuck and round cuts produced in Texas," Tullos said. "This is important for the beef industry, because these end meats represent 66 percent of the beef carcass. The Texas IPI partners now are selling 14 different beef cuts. Before IPI, they were selling three basic cuts."

The U.S. Meat Export Federation in Mexico City helped identify the Mexican participants, who were divided into seven separate groups for beef trainings.

Following each of the seven trainings, TBC’s exporting partners provided intensive sales pressure and customer service to the participants on an ongoing basis. The result of all these activities was huge increases in beef sales for the three exporting partners, even considering that Mexico bought near-record amounts of U.S. beef in 1997.

USDA’s recently released final report figures showed Mexico became the second largest customer for U.S. beef last year, jumping ahead of South Korea and Canada. Mexico’s tonnage purchases of beef and beef variety meats increased 64 percent to approximately 146,000 metric tons. The dollar value of these purchases increased 74 percent to $345 million.

"In 1997, U.S. exporters enjoyed the best year for beef sales to Mexico since the 1994 devaluation," Tullos said. "Yet the beef checkoff-funded IPI program helped these three Texas exporting companies far exceed Mexico’s already high results."

The three IPI partners cumulatively increased their beef tonnage sales to Mexico from 46,484 pounds a month to $158,481 pounds a month, a 241 percent increase, after the checkoff-funded trainings. The dollar value of these sales increased from $86,387 per month to $243,100 a month, a 181 percent increase.

In the eight months following an IPI training, one casual dining restaurant chain in Mexico went from buying no U.S. beef to buying almost eight metric tons of chuck cuts per month.

TBC is continuing its IPI programs this year in addition to other export market development activities. One of TBC’s export goals is to increase the volume of Texas beef exported to other countries.

Studies conducted by CF Resources have reportedly shown that in 1996 global U.S. beef exports added $99.70 per head to the value of calves, $105 to feeder cattle and $110.06 to fed cattle.