Monthly Archives: November 2016

LET US ALL JUST BLAME THE POOR OLD COW

There was a time before the days of widespread dietary guidelines where people started the day not on muesli and skimmed milk but on pig fat and onion. It was a time when a skinny latte was not even a twinkle in someone’s eye. It was an era of cooking with dripping and lard and when we made steam puddings with beef suet as nobody had even dreamt of offering a palm and sunflower-oil based vegetarian suet. It was when ice cream contained dairy fats and not palm or coconut oil. Yes, as shocking as it sounds, those days did exist.

All this began to change when it was concluded that saturated fats were bad for you. Apparently, those of animal origin were worse. The consequence was that many of us grew up being told butter was bad and margarine was good and we should select the low-fat or zero-fat dairy option whenever possible. For years, the nutritional advice was to eat less fat and to replace the energy supplied from the fats with carbohydrates. It appears that times are now changing and some of the fats are being rehabilitated. At the same time, we are beginning to ask if eating too many carbohydrates and, especially, sugar may have significant and [apparently] unforeseen health consequences. Important as this evolving and controversial story is it is not the focus of this article.

To the best of my knowledge, back in the ‘60s and ‘70s as animal fats became ‘unfashionable’ the food industry had to identify alternatives. Thus, the emergence of trans fats [(from Wikipedia): Trans fats… are a type of unsaturated fats that are uncommon in nature but became commonly produced industrially from vegetable fats for use in margarine, snack food, packaged baked goods and frying fast food starting in the 1950s… Trans fat has been shown to consistently be associated… with increased risk of coronary heart disease]. As with animal fats, trans fats eventually fell by the wayside leaving the food industry hunting around for another option to use within so very many food products. Palm oil has proven to be that alternative.

It is safe to say that two major beneficiaries of the dietary changes that have seen animal fats replaced with vegetable fats have been soybean oil and, later, palm oil. Setting the nutritional issues aside, these changes have not been totally benign from an environmental perspective. The expansion in soybean and oil palm has had consequences but ones that rarely get mentioned at a time when ruminants [especially cattle] get such a bad press from the climate change lobby [see my earlier post, ‘Are some cows now more equal than others?’].

Soybean is a major source of vegetable oil. The soybean is ‘dual-purpose’ but, historically, two-thirds of its value [ref. soymeal.org] comes from soybean cake [thus it is often referred to as a protein (for animal feed) crop]. For reference [soymeal.org], about 17.5% of the bean is extracted as oil and 80% as meal. Consequently, a greater emphasis is placed on the use of soymeal for poultry, pigs and cattle rather than oil even though soybean oil production has risen from nearly 16 million tonnes in 1990 to nearly 43 million tonnes in 2014 [FAO]. The emphasis on meal is why meat and dairy production is often seen as resource-hungry and a major problem with respect to climate change. Apart from years of nutritional advice that favoured vegetable over animal fats, animal fats are now often believed to be bad for the environment and our climate.

A great deal of importance is placed upon cattle and climate change so one would expect that most soybean meal was fed to cattle. Usage in the USA is, however, estimated as “approximately 48% of the soybean meal is used in poultry feeds followed by 26% in swine feeds, 12% in beef cattle feeds, 9% in dairy cattle feeds, 3% in fish feeds, and 2% in pet foods” [Cromwell in soymeal.org]. The figures highlight just how much soybean is actually used for poultry and pig feed.

Are the climate-change concerns about soybean meal use in cattle because they are less efficient converters of the meal into human-consumable protein than intensively-reared, confined poultry and pigs? One would of course like to see the question answered in terms of cattle that are predominately herbage-fed and those that are grain-fed [the research may be out there but the author has yet to find it]. As stated earlier, all cattle are not equal and especially if one considers their possible role in carbon-sequestration and grasslands regeneration. Meanwhile is sufficient scrutiny being placed upon pigs and poultry?

Poultry as a white meat is often promoted as the healthier option but is it, if the usage of soybean meal in the USA is typical of wider global usage, also the environmentally-friendly choice?

To quote the World Wildlife Fund [panda.org], “unfortunately, the expansion of soy to feed the world’s growing demand for meat often contributes to deforestation and the loss of other valuable ecosystems in Latin America… in South America, almost 4 million hectares of forests are destroyed every year, 2.6 million of them in Brazil alone… [it] can largely be blamed on heavily soy-dependent livestock farming… limiting consumption of animal-based food products, particularly meat, is one thing people can do to help end this devastating trend”.

To add some background, using the FAO production figures [which date back to 1961], the global area devoted to soybeans was nearly 24 million hectares in 1961. By 2014 it had risen to nearly 118 million. Over this period Argentinian production has risen from 1,000 to 19¼ million hectares, Brazil from 240,000 to 30¼ million and the USA from 11 million to over 33½ million. Therefore, one can also see that Argentina has seen a massive expansion; presumably at the expense of its Pampas grasslands rather than rainforest [and thus it does not attract the same attention]. If, however, one considers that carbon loss from grassland converted to tillage as a major source of atmospheric carbon, how great has the impact of Argentinian soybean expansion been? And is the loss of carbon-sequestering, pasture-based cattle-farming only made it worse?

Who buys soybeans or its meal? In 2013 World trade in soybeans was 103 million tonnes [USA exports accounted for 38%, Brazil 42% and Argentina 8% [the latter processes most of its beans)]. Of this nearly 60% goes to China [which processes beans rather than imports meal and oil]. Some 62 million tonnes [FAO] of soymeal was traded internationally of which nearly 25 million [40%] was imported into the EU. Argentinian exports accounted for 35% of global trade, Brazil 21% and the USA 12% [FAO]. For reference, Argentina is 100% GMO, the USA 93% and Brazil 92% [GMO Compass].

What would be interesting to know is what proportion of soymeal imported into the EU was used for poultry, pig and cattle [dairy and beef] feed. In the context of EU imports, Ireland is a relatively small importer of soymeal. In 2013 it imported about 415,000 tonnes [FAO]. By 2015 [CSO] this had risen to nearly 450,000 tonnes of which about two-thirds came from Argentina. For what is it used?

As highlighted earlier there are environmental issues around land use for soybeans in South America. For some food consumer and those in the supply-chains that provide for them there are also other issues with soya; namely the use of GMOs and the associated use of the glyphosate herbicide. Whatever farmers and scientists think about these technologies; the situation is that many consumers [often premium-paying] are concerned about their use and are willing to pay to avoid them. The question for a country like Ireland that aspires to be a premium foods producer is, does it wish to take account of these consumer preferences or not?

A while ago I read an article from the USA that asked whether Irish butter was GM-free. It may be promoted as grass-fed but is it also produced without the use of GM feeds [i.e. soybean meal]? When one reads about UK and German supermarkets looking at only stocking livestock products from animals that are fed GM-free diets, the GM-issue should be of major concern to Ireland. Is there a correlation between Ireland’s target markets for, for example, developing the Kerrygold brand and consumers who wish to eat a GM-free diet? One can believe that these consumers are poorly informed but can you create a sustainable business by ignoring the wishes of your target consumer?

To return specifically to soybean meal usage, should we be looking at our consumption of poultry meat more than we are? Chickens bred for intensive, confined systems grow at an incredible rate. Are they fuelled by protein-rich diets to do so? Are we consuming vast amounts of soymeal to feed our desire for cheap chicken-derived protein? And should we also be considering the broader issues like bird welfare and antibiotic use? If one compares chicken-based protein with that from grass-fed, largely free-range, cattle production, are we targeting the wrong protein producing systems?

Another major protein feed imported into Ireland is palm kernel extract [PKE]. This is the reside left after extracting the oil from the palm kernel. The palm kernel itself being the minor proportion of the palm fruit [from which most the palm oils is derived]. In this case PKE is the by-product of producing palm oil. Its availability has, nonetheless, increased significantly in recent years as the demand for palm oil by the food industry [as trans fats usage has declined] has risen.

In 1961 the global palm oil area was 3.5 million hectares [FAO]. By 1990 this had risen to 6.1 million hectares. It exceeded 10 million hectares by 2000 and over 18.5 million in 2014. In 1990 palm oil production was about 11½ million tonnes. By 2014 it was nearly 54½ million. Palm oil has seen a recent and dramatic increase in usage and it is one that is driven by the demand for palm oil as a vegetable-fat. It is probably the greatest development resulting from the substitution of animal fats by vegetable fats in the human diet [a consequence of decades of nutritional guidelines]. The question is, has this change been a benign one for our environment and our climate?

To say that there is concern about deforestation in regions like South-East Asia due to the expansion of oil palm is an understatement. Not only is there the carbon emissions from forest clearance itself but there are the issues of habitat loss and species extinction. There are now sustainable palm oil initiatives but are they doing more than scratching the surface? And our demand for palm oil seems to be insatiable and it has major environmental costs. Is it a cost that can be traced back to our nutritional-guidelines-driven switch to vegetable from animal fats [with an intervening digression into trans-fats along the way]? Is it an unforeseen but costly consequence?

It was only a few weeks ago that Professor Keith Woodford [Lincoln University] raised the issue in his blog of PKE usage in New Zealand. The country’s dairy industry has taken massive advantage of the increasing availability pf PKE in its wider geographic region. In 2000 New Zealand imported 539 tonnes of PKE [FAO]. By 2013 this had risen to 1.6 million tonnes! Ireland, by contrast, imported an eighth of the quantity in 2013. Now PKE is a genuine by-product of palm-oil production [simply nobody would grow oil palms for animal feeds, the yields are just far, far too low] but that aside, Professor Woodford still considers it necessary for New Zealand to look at how it can protect its grass-fed, sustainable image from being undermined by its use of a potentially ‘toxic’ [from an environmental image perspective] imported animal feed. Ireland needs to watch this space.

Here I have highlighted issues surrounding two sources of animal protein feeds; both have environmental question marks. One would strongly recommend that, in the context of promoting Ireland as a sustainable, green premium-foods producer, their sourcing is reviewed. It is a review that should also be taken further in terms of animal feed imports; the overall tonnage is not limited to circa a million tonnes of proteins as [in 2015] a similar tonnage of food processing by-products was also imported. And then there was nearly another million tonnes of maize… Ireland’s livestock farming is highly import dependent in terms of feeds, fertilisers and fuels and it could have implications when it comes to selling the country’s green, sustainable image. One accepts that Irish farming, with its limited land resources, needs to import what it cannot produce but it is important to ensure that the input supply chains are also verified as ‘sustainable’.

There looks to be several positives appearing concerning cattle farming at present; albeit for cattle farmed in a certain way. There is a lot of talk of ‘grass-fed’ but, as stated in a previous blog, it will become insufficient to be selling products that are loosely-defined as ‘grass-fed’. There is also the Omega 3 / Omega 6 issue that favours grass-fed over grain-fed. And then there are farmers who are working on grassland management techniques focused on sequestering carbon. And there are researchers and practitioners who belief that it is possible to use cattle to regenerate ancient grasslands and restore arid areas. The author believes that the coming years will reveal that cattle farming is not all bad, far from it. It is just that we must be selective about how we farm cattle and, many people say, some societies must eat less meat per se. They must simultaneously place a greater value on meat itself.

Having started by writing about nutrition, I will come full circle and mention the current ‘rehabilitation’ of the animal fats. At least it has happening for some, if not others. It is now, at least, a point of controversy. I would recommend reading ‘Big Fat Surprise’ by Nina Teicholz; it takes to task many decades of what has become the conventional thinking on nutrition. It asks just how far reaching have been the health implication of those guidelines and our replacement of animal fats with vegetable fats and fats with carbohydrates. I cannot adequately summarize here what Nina Teicholz has to say, but for anyone with interests in the production of grass [herbage is a better descriptor] -fed meat and dairy products, it should be obligatory reading.

Further, I would add to the obligatory reading list ‘Defending Beef’ by Nicolette Hahn Niman and ‘Grass-fed Nation’ by Graham Harvey. For herbage-focused farmers they are a triumvirate of books when it comes to creating a vision for the future. By reading them together, one can see how nutritional guidelines have impacted upon the health of whole nations and massively influenced the direction of the farming and food industries.

When supported by rising consumer wealth, the nutritional guidelines have had environmental consequences as we have used soybeans to fuel the growth of, in particular, poultry meat production and palm oil to provide for the needs of a food industry in a post-trans-fats era. They have also impacted upon animal welfare and especially bird welfare as we have switched to white from red meat. These are consequences that are often go unmentioned; they are extrapolations of my own and they come from joining the dots of what is a complicated issue. They are, however, issues that herbage-focused farmers need to understand when everyone appears to be blaming the poor old cow.

is not saying that cattle production does not have its issues. Should we be eating so much cheap beef? Maybe we should be eating more pulses directly rather than converting them into proteins via farmed livestock? Maybe we should be asking ourselves more rigorous questions over the merits of confined versus free-range livestock farming. And, although I have highlighted, the environmental consequences of soybean and palm oil production, we should not ignore the impact of cattle farming on, for example, water quality or carbon emissions in general. And we should be asking ourselves just how resource hungry is grass-based farming when it is reliant on man-made fertilizers rather than nitrogen fixed by legumes. Everything is not rosy in the garden, but it is also not as weed-infested as some would like us to believe.

opportunities that changing thinking on nutrition could be immense for Ireland’s ruminant-based agriculture. They will, nonetheless, not be realized by believing that a generic-Irish, slap-a-sticker-on-it, sell-what-we-have approach will work. It is not what will convince the target consumer to pay the premium necessary to allow the structure of the Irish farming industry to remain. As I often state, for that to happen we need to see a premiumized farm-gate price. That could happen given that premium-paying consumers are going to increasingly demand credible traceability and a fuller understanding of the farming system behind the product [and providing them with anything less will risk another ‘horse-gate’]. The foundations of that credibility must be created on the farm with farmers making the changes necessary to deliver on what the consumer aspires to. And when one views it from such a perspective one also realizes that the opportunities can benefit the farmer; that is if they are their leadership are willing to go out and grasp them before others do.

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SPINNING A YARN TO IRELAND’S FARMERS

Ever since arriving in Ireland back in 2013, the author has been amazed at how active the press and the agricultural establishment has been at telling farmers what they need to know and the information that they should be basing their farming and investment decisions upon.

For the first couple of years, this was about how important the agri-food sector was to an ailing economy. It was about farmers pulling on their green jerseys to help the country by providing the raw materials for a food processing industry that was a major export earner. It was and still is about the headline export earnings figure. It remains the number that is foremost when it comes to agri-food strategy and how successful the agri-food sector is. Ask a politician about the health of the farming industry and the likelihood is that they will reply with export earnings figure.

The headline figure is always gross; it is never net. Or should we be talking about the agri-food trade balance? True the gross figure reflects the wider economic activity within Ireland but what about all the farm-input imports that the farming sector needs; its energy, its one million tonnes or so of nitrogen fertilizers, its one million tonnes of protein feeds; its pesticides and its farm machinery? And then there are the imported raw materials that are not produced by Ireland’s farmers that the food processing sector uses; be it, for example, palm oil or cocoa powder. And finally, one can add in all the imported food that is consumed by the Irish population; imported in part because the food processing sector chooses to focus on producing for export rather than feeding the Irish people. It may be a case of making decisions based upon where the processor-exporters see their comparative advantage but whilst they export to feed China, are they feeding the Irish at home?

One should also add that the headline figure for export earnings has been influenced by recent high food prices. It will be interesting to see if the export earnings have been maintained [or even risen] over recent months at a time when farm-gate prices have fallen. If they do continue to move ahead whilst farm incomes and farm-gate prices have fallen one should be asking just what is going on. In a country that is meant to have a co-operative ethos in its dairy sector, one would expect that processing sector earnings should in some way be reflected in farm-gate prices.

One did notice the indecent haste with which the Food Harvest 2020 agri-food strategy was updated to Food Wise 2025 before the last election. One wonders if it was done so before the current farm income crisis became too evident. For the farming community, after a couple of years of farm-gate prices being below the cost of production, it is now all about farm incomes. Sadly, we remain with an agri-food strategy that is about export earnings from the ‘agri-food’ sector and not about enhancing farm incomes. It is apparently now locked in until 2025 and immune to change despite the all-sectors farm income crisis, Brexit and climate change. As when Margaret Thatcher was asked to perform a U-turn, the answer is “the lady is not for turning”.

One can argue that the national agri-food strategies are working well. Agri-food exports have been rising [at least in monetary terms (one will not go into the details of volume)] and it appears that the returns being generated by the processing sector have been okay. That is not surprising if one believes [cynically or otherwise] that a primary objective of both strategies was/is to support farming to more efficiently produce low-cost raw materials for the processing sector. Even more cynically, one could suggest that this objective does not give due consideration to farm incomes.

It appears that analysing the two strategies impact on farm incomes was not undertaken at the strategy development stage [or that the farmers’ leadership insisted that it should be so done]. The habit of many in the establishment of saying that Ireland is a low-cost producer of farm products [based upon partial costings] only makes matters worse. That Ireland is a low-cost producer is indeed one of the greatest yarns spun to farmers. Just why is the idea perpetuated that Ireland is an internationally leading low-cost milk producer when Teagasc’s own report in 2011 into international cost comparisons concluded that, on a full-cost basis, Ireland was only average. With larger farms it could be a low-cost producer, but the scale required can only be achieved by land consolidation, massive farm investment and a significant decline in farmer numbers; none of which are going to happen overnight or even by 2025.

So, we have a successful agri-food strategy in operation and that is supported by Irish farming’s low-cost farming systems. Is that Yarn #1?

Another of the author’s favourites yarns is the one that said that Irish farmers should expand post the end of milk quotas because the world needed and would absorb any amount of food produced; after all the global population was going to reach nine billion souls by 2025. Rarely did anyone say where these people were going to be living or whether they could afford to purchase food produced in Ireland. Indeed, one has already heard of ‘success’ stories whereby Irish milk powder is sold in sub-Saharan Africa. The author did ask the simple question; “will it provide an improved return to the Irish dairy farmer?”. Not unsurprisingly, a definitive answer was not forthcoming. Apparently, the idea of analysing the supply chain backwards from the retail price to the farmer is not done. Or maybe it is beyond the investigatory capacity of Ireland’s farming journalists [even to the extent of asking the question]. Across most sectors, there is the naïve assumption that just by exporting produce, the Irish farmer will benefit. Yes, somebody does benefit but judging by current levels of farm income, it is not the farmer.

So, higher exports will lead to improved farm incomes and farmers should invest to expand on the assumption that the latter will automatically happen. Is that Yarn #2?

A third yarn is that particular agri-food exports illustrate how successful the agri-food sector as a whole [including farming] is. Although not definitively said, it can be construed that the message to farmers is that they should consider that success when it comes to their own on-farm investment decisions.

In the dairy sector, it seems rare to ask who benefits from those exports and whether there is any ‘trickle down’ to the farmer [who incidentally often must make the major proportion of the investment required to increase volumes]. In the meat sector, however, most farmers would swiftly ask the question due to the limited private ownership of the factories. The difference is probably explained by the more complicated structure of the milk-processing sector [where some co-operative ownership remains]. The author’s recommendation is to look at the latter in terms of who owns the primary and secondary processing activities and to keep in mind that it is second that owns the brands and sells the finished products. And also, ask if in recent years the cooperatives have invested in primary processing or the [probably] more profitable higher-value-added secondary-processing along with its associated brand-owning, nearer-to-the-consumer activities?

Of note, is the success story that is Irish infant formula [yes, there is controversy around infant formula but there is a need for it, so why not Ireland]. Recent years have seen significant rises in Irish formula exports. On the assumption that category 098.93 of the CSO export data is dominated by formula exports, exports have risen from 105,000 tonnes in 2012 to 161,000 in 2015. In value terms, exports have risen from about €680 million in 2012 to €1.17 billion in 2015.

Interestingly, for the first 8 months of 2016, export volumes have been about the same [104,000 tonnes] but export value has risen from €758 to €854 million. The value rise is largely attributable to a c.50% rise in sales to the lucrative Chinese market [includes Hong Kong]. In 2012 the average sale price for exports in this category was nearly €6,500 per tonne whereas it was close to €7,300 in 2015 and over €8,200 for January to August 2016. This is largely driven by the growth in China/HK which accounted for 10% of sales volume in 2012 and 25% in 2016. By contrast, the mature EU market has a much lower unit sales value [under €4/kg in 2016 compared to China at nearly €15/kg].

If one accepts that export earnings are a good key performance indicator [KPI] for the Irish agri-food sector the latest export earnings figures from the CSO for the 098.93 category indicates what a rip-roaring success infant formula manufacturing and selling is for the agri-food industry.

From a farming perspective, has the performance of the infant formula sector benefited Irish dairy farmers? From reading the press and hearing comments from politicians and farmer leaders, one would assume so. Let us, however place this in a different context.

Few dairy farmers would doubt that 2015/16 has been a poor year for farm-gate milk prices. Would they have been even worse if not for the infant formula sector [a sector that has seen a 12.5% growth in sales in 2016]? Irish dairy farmers produced 6.75 billion litres in the September to August 2015/2016 period whilst the infant formula sector export sales were €1.25 billion. This equates to an export sales figure equivalent to 18.5 cpl. It is a thought-provoking statistic.  Should these export sales figures be delivering a better return to dairy farmers?

Are, nevertheless, these sales made by that part of the milk processing that is owned by the dairy farmer? The answer is only that which is indirectly owned as shareholdings in the PLCs by the cooperatives. Farmer ownership is too often limited to low-value-creating primary-processing whilst processing into consumer products and brand ownership lies in the secondary processing sector [which is often owned by the private sector]. One should ask just what proportion of infant formula sales from Ireland are made by Nestle, Danone and Abbott Nutrition? If the brands and manufacturing of infant formula is controlled by privately-owned multi-nationals, just what level of ‘trickledown’ to farmers should we expect?

It is often said that it is important to use Ireland’s green and grass-fed images to promote infant formula; that there should be an Irish brand in the market place that promotes these virtues. It is also often said that ‘product of Ireland’ should be more in evidence. Is either realistic? The common labelling used with infant formula, at least when reviewing the online retail listings, is ‘produced in the EU’. Hipp Organic does, at least, manage to specify ‘produce of Germany’. If one looks at the ingredient lists for infant formula, it then becomes self-explanatory.

If one peruses the information [easily accessible via online supermarket listings] for a widely available ‘First Milk’ formula one can work out that the fat, carbohydrate/sugar and protein contents of the powder are about 23%, 47% and 8% respectively. Where it gets interesting is when one also looks at the ingredients that fulfil these nutritional categories.

Now one may think that the fat content in baby milk powder comes from milk from [in this case Irish ‘grass-fed’] cows. Well one would be wrong. The typical ingredient list specifies “vegetable oils (Palm, Rapeseed, Coconut, Sunflower)”. One can be certain that none of these, rapeseed oil included, are of Irish origin. Hence, straight away, one can see how difficult it is to ‘play up’ the Irish farming origins of the infant formula. They are manufactured in Ireland and their manufacture may create economic activity and employment in the wider economy, but they are not derived from dairy fats as is the case with butter or cheddar cheese.

The carbohydrate source is lactose [from milk] and the protein source from demineralised whey [from milk]. Can one assume that these are or Irish origin? It is a question that warrants further investigation given that in 2015 Ireland IMPORTED about 55,000 tonnes of lactose and 40,000 tonnes of whey [it also imported 48,000 below -1.5% fat milk powder (with the value of all three items being about €200 million)]. These are being used by the food industry and in quantities that brings into question whether many food products can be linked to Irish farm production.

As a note, Ireland imported 92,000 tonnes of palm oil in 2015. It also imported 46,000 tonnes of soybean oil. Neither of these are widely used by the general population for cooking. Hence, as with proteins for animal feeds in farming, the food processing sector is reliant on imported vegetable oils. This again shows how difficult it is for the processing industry, with its complex food products, to build their sales promotions around ‘produce of Irish farms’.

So, should farmers be more sceptical when they are told that they are directly benefiting from the export activities of the agri-food industry? One would say so. One is not questioning whether Ireland has a successful food industry but one is questioning whether its success is trickling down to the farmer. Are we even right in expecting that it should? Or should we accept that, as with many manufacturing processes, raw materials and components are sourced from the most appropriate supplier. It is then about being processed in Ireland using Irish people, skills and technology? It is beneficial to the economy but, judging by recent farms incomes, not necessarily so to the farmer.

It is a clear reason why Ireland needs to separate its agri-food strategy into one for food processing and one for farming [and rural Ireland]. Government expenditure to each sector can then be better targeted, justified and rationalized. It may then be appropriate to judge the food industry’s performance on export earnings whilst farming can be first evaluated in terms of farm incomes.

One would also suggest that the farming community and its leadership needs to become far more aggressive in terms of critically analysing what they are told and specifically the broad-brush measurements of ‘success’ that are used.  Yarns are just too common place but, too often, they are going unchallenged.

HAS ‘GRASS-FED’ GONE BEYOND ITS ‘BEST BEFORE’ DATE?

A couple of years ago I wrote a post about ‘grass-fed the American way’; or more specifically about how ‘grass-fed’ is defined by the USDA and American Grass-fed Association {AGA}. The term ‘grass-fed’ has, in the USA, already been specifically defined. This did not, however, stop a great deal of talk this side of the Atlantic about how Ireland was going to sell a vast tonnage of ‘grass-fed’ beef into a newly opening US market. It was as if the definition in use in the USA did not matter.

Now it appears that ‘grass-fed’ is a label that is on the up in the USA. AGA is not alone in having established a grass-fed label. These labels [as with the USDA definition] come with protocols and standards [something that appears to be absent when it comes to the sales-promotional use of ‘grass-fed’ in Ireland]. Should one expect, at some point in time, that the organisations promoting grass-fed brands will defend their intellectual property through any legal avenues open to them? When/if it happens will the days of ‘grass-fed’ being easy-to-band-about sales patter be over? Is it realistic to suggest that its use as such for beef, lamb and dairy products may already be nearing its ‘best before’ or even its ‘use-by’ date?

And one should not consider that these developments are peculiar to the USA. ‘Grass-fed’ as in ‘pasture-fed’ has already been defined in the UK. It is interesting that in the UK they have already chosen to use an alternative to ‘grass-fed. Over use and the rigour associated with the term ‘grass-fed’ may be a reason for using the alternative ‘pasture-fed’ term. If so, it was a wise choice. If one is going to develop the standards and protocols behind a designated-origin, proven-provenance label, why start out by using a term that is already being widely used and one that is not defined by specific farm-husbandry practices encapsulated within a designated-origin scheme.

Creating ‘grass-fed’ products is not only happening in the USA and the UK as one hears of initiatives in, for example, Australia and New Zealand. One should also expect them to happen in countries that are renown for beef and have a history of grazing extensive grasslands. Amongst these one may find the former communist countries of Eastern Europe [and some may be well placed to take advantage of premium markets in countries like Germany (not least because they may utilize German investment)]. The author well knows the grasslands of Transylvania [God’s own country when it comes to cattle] and they have a history of being farmed by ethnic Germans and Hungarians and supplying the Austro-Hungarian Empire and its armies with horses and cattle. And then one reads about 135,000 suckler cows in one single operation in Russia.

Suckler cows and Aberdeen Angus may be common to many of these ‘grass-fed systems. Of course, one can argue that many of these locations do not have Ireland’s long grass-growing seasons but then again they will have scale in their favour [and often much lower land costs]. Locations like Transylvania are also where lucerne/alfalfa and other legumes thrive. Just how does the economics add up when these can provide low-cost winter forages? The numbers are somewhat different when the forage-based system is not built upon ryegrass and nitrogen fertilizers. Does Ireland really have that great a cost advantage or, for that matter, lower per unit climate-change-linked emissions? The whole grass-fed, pasture-fed, forage-fed issue is a rapidly evolving one and it is not one that can be addressed by simplistically attaching the term ‘grass-fed’ to your products.

So what Is Ireland up to? Is it now running around the globe trying to open ‘premium’ markets for its ‘grass-fed’ beef? Is it ignoring what others are doing and hoping that it will be able to convince the consumer that its more generic approach will suffice; that it is grass-fed simply because we say so? Is this just another sales-team approach that says that we can sell it because it is Irish? Is it all about what the ‘marketing boys’ say, regardless of whether the product stacks up when scrutinized by an issues-aware, day one say it, intelligent consumer; albeit that they are the ones who generally inhabit the upper tiers of the food markets? If so, it is not a sustainable approach.

Hence the very real question, what does ‘grass-fed’ mean when it comes to products from Ireland? Is there a clear definition of what is ‘grass-fed’? Is it that a minimum of 51% of the animal’s lifetime diet must come from grass [including grass-based forages]? And just what is meant by ‘grass’? Is it from ryegrass swards that are fed with the country’s 1.5 million tonnes of imported nitrogen fertilisers? Or is it from more diverse swards that also contain legumes? Or is it from more extensive biodiverse grasslands? The consumer might wish to know.

And what about the/any non-grass based part of the animal’s diet. Of concern is for the issues-aware consume is GM-feeds but Ireland imports hundreds of thousands of tonnes of soymeal from Argentina. The GM issue may not be of concern to Ireland’s ‘science’-focused establishment but it is of concern to many premium-paying consumers [as exemplified by Waitrose’s choice to only sell products from animals fed on a GM-free diet]. One can also add in issues like whether the soya was grown on land that was originally rain forest or Pampas grasslands or whether the palm kernel extract from certified-as-sustainable plantations. Both have climate-change emissions ratifications that consumers are and will become increasingly aware of. And to repeat oneself, the consumer is in charge and the future is not about ignoring the consumer.

Meanwhile others are developing the products that the premium markets want. The French with their multi-level, designated-origin schemes have been doing so for years. Others are cottoning on. Ireland is not because to do so means first changing the systems from the farm up. These schemes must be first about the husbandry employed on farm. They are then about operating supply-chain partnerships and ensuring that the routes to market are genuine partnerships that return a fair price to the farmer to reward the husbandry skills employed. Does that sound like something that Ireland’s often antagonistic [when it comes to relationships] routes to market can deliver?

The very industrial-scale, centralized nature of the routes to market may also count against Ireland when it comes to delivering to the top end of the markets; not least when some consumers see ‘local’ as an increasingly important consideration [local in terms of animal slaughter is also an animal welfare issue and, some would say an eating-quality (less stress) issue]. Low cost, centralized processing may deliver cost advantages [that may or may not benefit the farmer] but what role does it have when it comes to linking the premium-product producing farmer to the premium-paying consumer? Is it inhibiting the income-earning potential of most Irish farmers; be they supplying meat or milk or grains? It is a result of years of agri-food strategy preparation that has been dominated by the needs of the processor/exporters and not the farming or rural communities. There is, sadly, no sign of this changing. And in allowing this to happen, Ireland’s vaunted farmer representation has failed its membership. It is a failure that is going to be difficult to rectify.

To return to the original premise of the post; is ‘grass-fed’ a term that has reached its ‘best before’ date? For an agri-food industry that liberally uses ‘grass-fed’ it must be a shocking idea. Setting aside the thought that it is in danger of being over-used for sales promotion, [I choose not to use the word marketing because ‘marketing’ in its purist’s form means first using market research to define the product, pre-production], one is asking if the term ‘grass-fed’ is, from an evolving farming systems perspective, already dated? It may well be.

Long term one cannot see Ireland’s ‘produce-it-and-then-shift-it’ approach [where labelling is a part of the ‘shift it’ activity and not the ‘produce it’ activity (it is sales and not marketing-led; i.e. supply-driven)] delivering for farmers via improved farm incomes? It may continue to deliver for the post-farm-gate, processing sector but, as recent months have suggested, that sector is well able to protect its own supply-chain margins through market downturns. Just how well have they passed on the pain of low market prices to their farmer-suppliers?

As said earlier, the World is moving on. ‘Grass-fed’, as per the USDA, is gaining a stronger foothold in the USA [often seen as a target market for Irish ‘grass-fed’ products]. What will premium beef become in the USA, marbling and eating qualities aside? Will it be about cattle reared using traditional ranching and rangeland management methods? Will it be about returning land to its biodiverse former self? Will it be about returning carbon to soils through using, for example, mob-grazing? In an era where cattle are often considered as a major cause of climate change, will it be about showing how cattle farming can sequester carbon and be, at worst, carbon neutral? Will raising beef be about being in tune with nature and with the demands of those consumers who do understand that beef is a complex product that encompasses many characteristics and issues? This is all a far cry from rearing cattle on nitrogen-fed, non-biodiverse, grasslands.

Moving on from the USA, Tasmania is developing a label that promotes the sale of cattle that are totally free range and are certified hormone, antibiotic and GMO free. And then there is the premium beef range from New Zealand that specifies that its cattle are Black Angus and that they are raised free range on New Zealand’s pastures.  Its beef is “grass fed” and that means 100% grass fed and grass finished. The cattle are 100% pastured as required under USDA grass-fed rules.

The French go further and have done so for years. Their upper-tier products specify the production location, the breed, the feeds used, minimum and maximum slaughter ages and the use of local slaughter only. In some cases, like with the premium Charolais label, the rules specify the specific pastures [designated because of their biodiverse nature] upon which the cattle can be finished. It is all about the ‘terroir’. It is about ensuring that the consumer knows exactly how the product is produced and from where. Interestingly. it is also about limiting production volumes to ensure that the producer retains some control and that volume limits create scarcity to maintain a price premium. It is about premiumization of the farm-gate price and farm incomes.

The underlying message here is that premium markets are far more sophisticated than appears to be appreciated in Ireland. Increasingly they are about having the transparency that allows the consumer to understand and appreciate how the product is produced on-farm. Yes, it often includes transparency about the processing activity but the premium-paying, issues-aware consumer wants to know more about how the ‘raw material’ is produced down on the farm. And this goes well beyond form-filling quality assurance schemes, it is about the farming systems themselves and ensuring that they and the products they produce meet the demands of the consumer. Adding a label at the its-already-produced, ‘shift-it’ stage is not going to cut it going forwards. Well not if the expectation is to access the real premium markets. And they are the ones that the small-scale, volume-constrained, Irish farmer needs to be suppling if farm incomes are ever going to move towards that key target of Origin Green, to achieve sustainability all along the Supply Chain.

So just what is Ireland doing? Is it running around the World believing that its concept of what is ‘grass-fed’ will allow it to access the top end of the market? If it is, is this in the full recognition that this will deliver better incomes for the farmer? Or is it still largely about shifting commodities? Have the responsible parties yet grasped the idea that it is about developing long-term supply-chains for unique-to-Ireland, designated-origin products? Or is there still the old problem, that Irish farming is supply-driven and not market-led? Is it still commodity-minded and not product-orientated?

The current approach to using the term ‘grass-fed’ is both supply-driven and commodity minded; it is about producing the beef in the same old way and then adding the label later. It is still the ‘produce it / shift it’ model. It is not an approach that will work with sophisticated, premium-paying consumers and it is not one that will open-up premium markets for the long-term as there will simply be too much competition around that will be equipped with the real McCoy; designated-origin products with a complete story and a transparent history to support its grass-fed, pasture-fed, forage-fed [insert your term of choice here] claims. Aiming to sell products using only a broadly generic ‘grass-fed’ label; albeit that the grass is grown in Ireland, will not be where it is at.