C ANADIAN C ATTLEMEN
M ARKET D EVELOPMENT C OUNCIL
________________________________________
-
2013/14
Marketing Implementation Plan
April 1, 2013 to
March 31, 2014
The Canadian Cattlemen Market Development Council (CCMDC) is a partnership of the Canadian beef
cattle industry, the Government of Alberta, and Government of Canada to fund and oversee a 10-year global
marketing plan to help the industry recover from BSE.
The vision of the CCMDC is to recover and expand markets for beef and cattle genetics around the world
assuring a profitable, sustainable Canadian industry that results in Canadian beef and cattle being recognized
as the most outstanding by Canadian and world customers.
Canadian Cattlemen Market Development Council
Contents
Executive Summary..............................................................................................................................3
Introduction .........................................................................................................................................7
Canadian Cattle and Beef Outlook 2013 and Global Beef Situation .................................................10
Canada Beef Inc. Marketing Strategy ................................................................................................16
Global Markets Summary ..............................................................................................................20
Canada ...........................................................................................................................................22
United States..................................................................................................................................26
Latin America (Mexico, Cuba, Colombia, Puerto Rico) ..................................................................31
Japan ..............................................................................................................................................35
South Korea....................................................................................................................................38
China ..............................................................................................................................................40
Hong Kong......................................................................................................................................43
Southeast Asia (includes Taiwan, Singapore, and Philippines)......................................................45
Russia, EU and Middle East and North Africa (MENA) ..................................................................49
Canada Beef Inc. Operating Budget...............................................................................................54
Canadian Beef Breeds Council Marketing Strategy ...........................................................................55
Genetics Environmental Scan 2012 ...............................................................................................57
Genetics Marketing Programs .......................................................................................................61
CBBC Operating Budget .................................................................................................................81
Alberta Based Supplementary Marketing Initiative ..........................................................................82
Legacy Fund Budget 2013/14 ............................................................................................................83
Appendix ............................................................................................................................................86
Canada Beef Inc. three-year strategic plan and performance measures framework ...................86
CBBC Background and three year market development strategic framework .............................93
Canadian Cattlemen Market Development Council
Executive Summary
The Canadian Beef and Cattle Market Development Fund, also known as the Legacy Fund, was
established in 2005 to recover and expand markets around the world for Canadian beef, supporting
long-term market development. The Fund at inception totalled $80 million ($50 million invested by the
Government of Canada, $30 million by Alberta government), matched by producer check-off dollars.
Major fund recipients included the Beef Information Centre (BIC), Canada Beef Export Federation (CBEF)
and Canadian Beef Breeds Council (CBBC). The Canadian Cattlemen Market Development Council
(CCMDC) was established to oversee the allocation of the Fund and ensure a unified global marketing
strategy for Canadian beef and cattle genetics.
Over the past several years, industry leaders evaluated the structure of the Canadian beef marketing
organizations, assessing opportunities to maximize beef marketing program efficiencies nationally and
globally. In 2011 the Canadian Beef Cattle Market Development and Promotion Agency, also known as
the National Check-off Agency or NCOA was consolidated with BIC and CBEF to create a single,
independent national beef cattle marketing organization. This national organization, operating as
Canada Beef Inc., was created to carry out all domestic and international marketing and promotion of
Canadian beef. As such, effective July 1, 2011 the major fund recipients of the Legacy Fund are Canada
Beef Inc. and CBBC.
This Plan presents the marketing programs for Canada Beef Inc. and CBBC for the 12-month period April
1, 2013 to March 30, 2014. The programs outlined in the Plan align with the priority goals of CCMDC,
including:
1. Build awareness for a Canadian beef identity/brand built on benefits defined by a strong and
clear value proposition
2. Achieve growth in traditional, existing, new and emerging markets for Canadian beef or
Canadian genetics products
3. Maximize the total value realized by the Canadian beef and cattle genetics industry through
optimization of carcass values or genetics and live cattle values
Canada Beef Inc.
The Canada Beef Inc. strategy for domestic and international programs was developed with input from
industry partners and identifies four marketing priorities: brand differentiation; market segmentation
and development; product and industry image; and stakeholder connectivity. The strategy ensures
Canada Beef Inc. takes a leadership position in a collaborative effort to enhance the industry’s ability to
respond to challenges, communicate a consistent Canadian Beef Brand message and transparently
measure and communicate the benefits delivered through National Check-off investment.
The marketing strategy continues to focus on developing strong brand recognition for the Canadian Beef
Brand and on enhancing the awareness and understanding of key attributes of the Canadian Beef
Advantage (CBA). Ultimately it is the attributes of the CBA as they relate to both Canadian beef
products and the supply chain that support the value proposition for the Canadian beef industry and
provide the basis to differentiate Canadian Beef from the global competitors. The brand strategy also
includes a comprehensive consumer component that leverages the functional and emotional attributes
of Canadian beef and the supply chain. The consumer component will be executed across multiple
CCMDC Marketing Plan – 2013/14
3
Executive Summary
Canadian Cattlemen Market Development Council
channels including brand license partners in the target markets and retail and foodservice segments,
mainstream and social media, health influencers and stakeholders.
Although not eligible for funding under the Legacy Fund contribution, the domestic marketing strategy is
a major component of the global marketing strategy with direct linkages and synergies between the
domestic and international programs. The domestic market remains the most stable and highest value
market representing 63% of production. A strong domestic brand strategy will help to provide a
compelling reason for Canadian consumers to prefer domestic beef over imported product and ensure
confidence in the Canadian beef industry. The negative impact of the E.coli 0157-H7 related recall in the
fall of 2012 provided a reminder of the importance of maintaining consumer confidence and the need
for a commitment in communicating the food safety systems in Canada.
Export markets are critical to driving incremental value for Canadian production and providing higher
value markets for niche programs. However, it is critical to ensure the marketing strategy is focused on
allocating resources to markets that deliver the highest possible returns on Canada Beef Inc. marketing
efforts. In order to identify the proper allocation of resources for export markets, 29 exporters were
engaged and asked to participate in a market assessment to assist in identifying priority export markets.
Exporters consisting of large Canadian beef packers, Canadian veal packers, smaller specialized Canadian
exporters and vertically integrated value chain Canadian branded beef programs provided feedback on
market priorities and products that are targeted for each market. Considerations were also given to
markets in which expanded access was expected to be realized before the beginning of the new fiscal
period. When compared to resource allocations from the current year, allocations were increased in
Japan as well as China and the Emerging markets of Middle East/Europe. Allocations were stable in USA,
Latin America, SE Asia (with an eye to emerging Asian markets) and a slight decrease in Hong Kong, due
to the relative maturity of the market.
Key learnings by Canada Beef Inc. within the past year have resulted in a more efficient and consistent
delivery of programs in international markets. The traditional market boundaries have been blurred
through the development of a ‘hub’ based approach in key export market regions of Asia and
Mexico/Latin America. This approach enables the organization to more effectively deploy and leverage
resources in markets that represent value opportunities.
In an effort to extend the reach of brand marketing initiatives, relationships with the Trade
Commissioners Service will be enhanced in key export markets. Canada Beef Inc. staff will work
collaboratively to provide marketing tools, technical training on communicating CBA attributes and the
brand positioning, as well as financial support for promotional activities executed through embassy
sponsored events. The business plan has been developed to provide the organization with flexibility to
changing market and access related conditions in global markets. In order to capitalize on potentially
changing market opportunities, an ‘Opportunity’ budget was created.
Canadian Beef Breeds Council
The Canadian Beef Breeds Council (CBBC) developed it’s 2013/14 Marketing Plan while at the same time
undertaking a major organizational review. CBBC is a diverse organization representing 18 beef breed
associations, 10 export firms and four fairs or exhibitions within Canada. All of these members make
significant efforts to market quality Canadian genetics to both the domestic and international markets
while promoting the CBA. The breed associations are responsible for the protection of the integrity of
the pedigree records of their respective breeds. They are also charged with effecting genetic
improvement of their seedstock. Genetic improvement is sought primarily to improve the quality and
CCMDC Marketing Plan – 2013/14
4
Executive Summary
Canadian Cattlemen Market Development Council
demand for genetics within Canada but improved quality also assists in advancing the CBA
internationally.
Historically CBBC members have been perceived as not having focus when it comes to developing new
markets but rather responding to any and all international inquiries without a framework, strategy or
guide to this development. This 2013/14 plan, built on a longer term strategic framework, is CBBC’s first
step towards a more rational and organized approach to this market development for its members. The
plan recognizes that CBBC must still commit efforts towards maintaining lucrative traditional and
established markets while, in parallel, looking at new markets elsewhere as a strategy for market
diversity, growth and sustainability.
The CBBC market development plan was informed by a series of extensive member interviews and
committee discussions to set a long term strategic framework and targets for growth in priority markets
through productive and high performance activities. The industry is, in part, dependent on particular
breed-specific niche markets that are significant to a few CBBC members which was felt could not be
ignored. As such, proposed is a diminishing level of support for market development activities that will
subsidize high risk initiatives at a higher level than those in more established or easier markets. The
intent is to provide this risk determined level of support without exceeding the fifty percent.
As with previous plans, market development activities of breed associations and associate members
consist of inbound and outbound missions, attendance at trade fairs and breed congresses. Also as in
previous years, support is sought for after sales training and support – ensuring that the genetic stock
that are sold in overseas markets are properly expressed through correct feeding, care and breeding
practices that are particular to the breed.
CBBC member breed associations exist primarily to provide registered seedstock for the Canadian cattle
industry and the Canadian market will always be a high priority. The CBBC will be dedicating significant
effort during the tenure of this plan to enhance visibility and promotion of Canadian beef cattle genetics
within Canada. Equally, the International market offers an opportunity to capitalize on investment in
genetic improvement and increase the profitability of the beef sector through diversification into risky
markets with greater growth potential.
During deliberations CBBC identified potential synergies within the overall industry and sees potential
value in future cooperation and sharing within the industry. Specifically included in the plan is an
enhanced relationship and reporting agreement with Canfax. CBBC is also seeking a higher level of
collaboration and cooperation with other groups and organizations representing the various segments
of the beef cattle value chain. These include the Canadian Cattlemen’s Association, the Beef Cattle
Research Council, the Canadian Food Inspection Agency and the Beef Cattle Trade Advisory Group. In
particular, CBBC seeks greater partnership with Canada Beef Inc, Canadian Genetics Livestock
Association and key association members including Agribition, the Canada Bull Congress and Farmfair
International in order to leverage respective resources and networks, particularly internationally, to
facilitate broader industry growth than could be achieved if each acted independently. Importantly,
CBBC shares with each of these organizations the common objectives of enhanced market access and
the need for shared market intelligence. This plan allows CBBC members enough flexibility to support
existing markets while focusing CBBC major resources on new and emerging markets.
CCMDC Marketing Plan – 2013/14
5
Executive Summary
Canadian Cattlemen Market Development Council
Budget
Table 1 below highlights the Legacy Fund budget for the periods July 1, 2012 – March 31, 2013 and April
1, 2013 to March 31, 2014, and annual expenditures from 2007 to 2012. The 12-month 2013/14 budget
is $8,824,696. This is comprised of $4,325,279 from the Government of Canada and $4,499,417 from
Alberta, including the AIBMDF budget of $1,904,250. In 2013/14, the administration budget is
$417,030; the U.S. and international marketing budget is $7,610,416; and the genetics budget is
$797,250.
Table 2 below highlights the March 31, 2014 projected Legacy Fund balance of $9,384,933, including
Canada funds of $2,375,078 and Alberta funds of $7,009,854.
Table 1 - Legacy Fund Budget and Annual Financial Summary
2013/14
a
Budget
2012/13
b
Budget
2011/12
c
Actual
2010/11
c
Actual
2009/10
c
2008/09
c
2007/08
c
Actual
Actual
Actual
Revenue
Legacy Fund
Marketing - Federal
4,064,635
2,542,892
3,023,727
8,209,723
9,458,707
8,084,186
4,845,009
Marketing - Alberta
Admin - Federal
Admin - Alberta
Alberta only marketing
Special projects - Federal
Special projects - Alberta
Subtotal Federal
Subtotal Alberta
2,438,781
260,644
156,386
1,904,250
0
0
4,325,279
4,499,417
1,525,734
212,906
127,744
2,250,000
0
0
2,755,798
3,903,478
1,621,303
255,322
153,193
1,475,695
0
0
3,279,049
3,250,191
3,611,388
332,684
199,610
144,418
774
464
8,543,180
3,955,880
3,724,919
414,348
248,609
0
162,644
97,586
10,035,699
4,071,115
2,803,481
375,037
225,022
0
153,871
92,323
8,613,094
3,120,826
1,953,755
172,249
103,350
0
0
0
5,017,258
2,057,105
Total Legacy Fund*
8,824,696
6,659,276
6,529,240
12,499,060
14,106,814
11,733,920
7,074,363
Legacy Fund
Administration
Special Projects-InfoXchange
Commercial Beef
U.S.
International
Live & Genetics
Alberta only marketing
Subtotal Federal
Subtotal Alberta
417,030
0
0
707,061
4,999,105
797,250
1,904,250
4,325,279
4,499,417
340,650
0
0
276,750
3,142,126
649,750
2,250,000
2,755,798
3,903,479
408,515
0
321,555
690,366
2,840,842
792,267
1,475,695
3,279,049
3,250,191
532,294
1,238
2,190,743
1,668,015
6,122,963
1,839,388
144,418
8,543,179
3,955,880
662,957
260,230
3,250,508
2,397,298
5,387,877
2,147,944
0
10,035,699
4,071,115
600,059
246,194
2,893,335
2,548,043
3,496,836
1,949,453
0
8,613,094
3,120,826
275,599
0
1,588,750
1,817,823
2,392,191
1,000,000
0
5,017,258
2,057,105
Total Legacy Fund*
8,824,696
6,659,276
6,529,240
12,499,059
14,106,814
11,733,920
7,074,363
Expenses
a
b
c
April 1, 2013 - March 30, 2014
9-months July1, 2012 - March 30, 2013; includes additional $49,750 funding to CBBC
July 1 - June 30
Table 2: Projected Legacy Fund balance
Total legacy
June 30/12 balance
2012/13 budget (9-month)
2013/14 budget (12-month)
March 31, 2014
Projected balance
CCMDC Marketing Plan – 2013/14
$24,868,905
$6,659,276
$8,824,696
$9,384,933
Canada
Alberta
$9,456,155 $15,412,750
$2,755,798 $3,903,478
$4,325,279 $4,499,417
$2,375,078
$7,009,854
6
Executive Summary
Canadian Cattlemen Market Development Council
Introduction
The Canadian Beef and Cattle Market Development Fund was established in 2005 to support long-term
market development for Canadian beef and cattle genetics. The fund of $80 million is comprised of $50
million invested by the Government of Canada and $30 million by the Government of Alberta. These
monies, combined with national check-off dollars paid by cattle producers, are expected to provide over
$170 million for the 10 year period 2005 – 2015, to recover and expand Canadian beef and cattle
genetics markets around the world. The fund, also known as the Legacy Fund, was entrusted to the
Canadian Cattlemen’s Association (CCA) to administer in a strategic manner. In turn, the Canadian
Cattlemen Market Development Council (CCMDC) was established under the CCA to manage the Fund,
including fund allocation and development of annual marketing implementation plans.
Since fund inception and up until July 1, 2011, the Legacy Fund recipients included the Canadian Beef
Breeds Council (CBBC), Beef Information Centre (BIC) and Canada Beef Export Federation (CBEF). In
2010 and 2011, the industry collaborated on restructuring the organizations responsible for domestic
and international beef marketing activities. This assessment resulted in the merging of the BIC, CBEF
and the Canadian Beef Cattle Research, Market Development and Promotion Agency (also known as the
National Check-off Agency or NCOA). Effective July 1, 2011, this new organization operating as Canada
Beef Inc. assumed the responsibilities, programs and core functions of the three organizations (BIC,
CBEF and NCOA). During the period of this Marketing Plan, April 1, 2013 to March 30, 2014, Canada
Beef Inc. and CBBC are the major Legacy Fund recipients. The Alberta portion of the Legacy Fund,
known as the Alberta International Beef Marketing Development Fund (AIBMDF), provides an
opportunity for eligible projects managed beyond CBBC and Canada Beef Inc., to receive funding.
Canada Beef Inc. is entering its third year of operation, and its first year of a 12-month Plan after
realigning with a March 31 year end. CBBC undertook a major organization review over the past year,
setting a long term strategic framework with its members. This 2013/14 Plan covering the period April
1, 2013 to March 31, 2014, was developed by the CCMDC, incorporating the Canada Beef Inc. and CBBC
respective annual business plans. Each organization collaborated independently of CCMDC with
industry and membership in the development of their marketing strategies. Impacting the marketing
opportunities of the fund recipients, this Plan includes a Beef and Cattle Outlook section as well as
environmental scans of the Canadian beef industry and various markets as prepared by Canfax Research
Services, a division of the CCA and independent source for cattle market information.
Strategic Direction
Canada Beef Inc. and CBBC remain committed to developing marketing programs in support of the
CCMDC long-term vision and mission and key priorities as follows:
Vision: lead the world in profitable, innovative beef solutions – together,
Mission: create and achieve the Canadian Beef Advantage – together.
Key priorities:
1. Build awareness for a Canadian beef identity/brand built on benefits defined by a strong and
clear value proposition
CCMDC Marketing Plan – 2013/14
7
Introduction
Canadian Cattlemen Market Development Council
2. Achieve growth in traditional, existing, new and emerging markets for Canadian beef or
Canadian genetics products
3. Maximize the total value realized by the Canadian beef and cattle genetics industry through
optimization of carcass values or genetics and live cattle values
Canadian Beef Advantage – Industry Support for the Value Proposition
The Canadian Beef Advantage (CBA) remains integral to all programming supported under the Legacy
Fund. Developed by the CCMDC, this industry-wide, global brand strategy differentiates Canadian beef
and beef products. Based on a value proposition, the CBA describes unique standards and practices
implemented by industry, designed to achieve recognition by the domestic and international marketplace
that Canadian beef and cattle provide an advantage over the competition. Supported by a brand mark
and various attributes relating to beef production, grading, quality, genetics and nutrition and health, the
CBA was established to expand and secure Canada's access into markets for beef cattle and products and
clearly define Canadian beef and its advantages. The CBA marketing strategy continues to be prevalent
not only across the marketing programs within the domestic and international markets but also across
other programs including information exchange, on farm food safety, as well as beef research.
The Beef InfoXchange System (BIXS) was established in 2009 as a comprehensive information exchange
system to, in part, encourage producers to embrace the CBA and its role in developing an auditable and
credible brand promise, adding value to Canadian beef and efficiencies and profitability to the beef
production segment. As BIXS becomes more functional in enabling information exchange between all
stakeholders in the beef value chain, benefits to each sector’s participants will become clearer and drive
the utilization of BIXS. As the industry’s sustainability story evolves, BIXS will carry the message that the
Canadian beef industry is economically, environmentally and socially responsible.
Age verification of cattle continues to be encouraged to address market requirements for certain beef
products to international markets. The voluntary program remains a critical element of the Canadian Beef
Advantage. While some critical markets such as Japan are preparing to amend their age restriction to
align with OIE guidelines (30 months), age verification is still an important tool for managing SRM’s and
will continue to be a valuable attribute for marketing the CBA.
The Verified Beef Production (VBP) on farm food safety program is a key element in providing verified
assurance of on-farm food safety practices to domestic and international customers, and the program has
maintained steady progress in educating producers. Training producers via workshops or the easy-to-do
online version remains a focus, as it is the first step to applying VBP on a beef operation. Given that an
estimated 67% of beef production is from trained operations, the next focus is attracting further
participation in an initial validation audit (registration).
VBP continues to participate in additional modules that industry may deem important in the future. This
includes the potential for including biosecurity education in workshop training, and participating in the
development of a draft environmental module. There have been requests to include consideration for an
animal care module, once a Canadian beef Code of Practice is finalized.
The CBA value proposition that Canadian beef is a high quality, safe, responsibly produced product
deemed superior over the competitors’ by consumers is also a priority to the industry and government in
the area of research. This is evident through the National Beef Research Strategy which, developed by the
Beef Cattle Research Council (BCRC) and the national Beef Value Chain Roundtable (BVCRT), includes
CCMDC Marketing Plan – 2013/14
8
Introduction
Canadian Cattlemen Market Development Council
projects directly supporting the CBA. Whether it’s through beef quality audits or other projects, research
will continue to play a critical role in supporting the CBA and value proposition for Canada to provide high
quality beef and be a global leader in animal health and food safety. The research strategy is available
online at http://www.beefresearch.ca/about/national-beef-research-strategy.cfm.
CCMDC Marketing Plan – 2013/14
9
Introduction
Canadian Cattlemen Market Development Council
Canadian Cattle and Beef Outlook 2013 and Global Beef Situation
The following section has been provided by Canfax Research Services, a source for cattle market
information. The report is based on the best information available at time of writing.
Outlook 2013
In 2013 fed cattle marketings are projected to be down 50,000 head or 2% from 2012, with larger feeder
exports. The 2012 calf crop coming forward is projected to be steady (down 0.2%), with the smaller
yearling run reflected in the smaller 2011 calf crop (-1.5%) and smaller placements from July to September
(down 12%, 17% and 11%) limiting fed marketings in the first quarter of 2013.
Canadian Fed Cattle Marketings
4000
Exports
Slaughter
3500
Thousand Head
Fed cattle exports in 2013 are projected to be
down another 5% leaving domestic slaughter
down only 1.4% (this shrinks fed beef production
by 0.9% if carcass weights increase by 4 lbs.).
Non-fed marketings are projected to be down
3.8%, with exports up 10.6% (accounting for the
Levinoff plant being closed) and domestic
slaughter down 8.6%.
3000
2500
2000
1500
1000
500
Overall domestic beef production is projected to
0
be down 2.4% to 1.03 million tonnes. Stabilizing
85 87 89 91 93 95 97 99 01 03 05 07 09 11 13p
production is critical to assuring export market
supplies are available and to maintain domestic
consumption levels, as imports have not increased as much as expected with reduced global supplies and
strong global demand for beef. For example, Brazil is focused on their domestic market, U.S. supplies are
shrinking, and Australia and Argentina are looking to expand and therefore have reduced heifer slaughter
and consequently beef production. At the same time other markets (like Russia) remain in focus for
international suppliers. Beef imports are expected to be up another 3-5% in 2013, with reduced cow
marketings and tight supplies in the U.S. encouraging lean non-NAFTA imports.
Source: CBGA, AAFC, Statistics Canada
Canadian beef exports are expected to be steady to 3% lower in 2013. Things that will influence this are
not only production and domestic demand, but also how the Lakeside plant is managed under JBS in the
coming year. If they are aggressive with exports there is the potential to increase exports modestly given
strong global demand for product. However, if they are able to gain market share in Canada there is also
potential to see exports steady to slightly lower. The question becomes one of focus, priority and
marketing strategy by domestic packers. Currently fed cattle prices are expected to be up but not to the
extent seen in the last two years. Fed prices were up 19% in 2011 and 6% in 2012 and are anticipated to
be around 3-5% higher in 2013. This of course will depend on what strategy JBS decides to take in the
market as well, as how domestic consumers respond to continued increases in retail beef prices.
CCMDC Marketing Plan – 2013/14
10
Canadian Beef and Cattle Outlook and Global Beef Situation
Canadian Cattlemen Market Development Council
Summary Table
Domestic Production
2011
2012p
2013p
1,127,670 1,064,303 1,039,031
Fed
943,103
912,734
900,232
Non-Fed
184,567
151,569
138,800
Live Cattle Prod Exported
208,805
214,903
212,387
Total Production
1,336,475 1,279,206 1,251,418
Beef Imports
245,049
264,652
272,592
Beef Exports
413,876
364,211
354,718
Net Domestic Supplies*
958,843
964,744
956,905
13/12
-2.4%
-1.4%
-8.4%
-1.2%
-2.2%
+3.0%
-2.6%
-0.2%
Units: Tonnes (carcass weight); *Net domestic supplies=domestic prod+ beef imports- beef exports
Risk factors to watch:
1. Macro economy and the dollar – Much of the discussion on price outlook is based on tighter cattle
supplies, and relatively steady demand. Significant risks exist in regard to the global macro
economy and commodity markets. Any major changes in the U.S. economy or 'Fiscal Cliff'
discussions, the European economy, or a major Asian economy such as China or Japan could shock
the market. There are certainly going to be some bumps in the market in 2013, whether it is a
major market slump, or just demand pressure that sets a ceiling on beef prices.
2. The U.S. needs rain and grain. Moisture is required in the majority of the U.S. to ensure adequate
grain and grass and forage supplies are produced to maintain current cattle numbers, otherwise
forced cattle marketing may limit some of the North American price potential.
3. Heifer retention is a wild card. If weather permits and feed supplies are ample in some regions,
producers may retain more heifer calves than the modest number anticipated; further reducing
fed production in the near term.
4. Carcass weights are expected to be steady but could fluctuate up or down by five pounds
depending on weather this winter.
5. Cow slaughter could decline further despite strong trim prices encouraging marketings if
producers choose to retain more animals within the herd.
6. If market access to Japan improves (moves to 30-months from under-21-months) exports are
expected to increase.
7. A lingering question is how aggressive the new JBS management at Establishment 38 is going to
be in the fed cattle market and towards exports. While expected to be more aggressive in export
markets, strong domestic demand is also expected to draw product. Furthermore the JBS Hyrum,
Utah plant is a consistent buyer of Canadian cattle. How competitive these two plants will be or if
one plant will reduce production in the current supply situation is still a question.
CCMDC Marketing Plan – 2013/14
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Canadian Beef and Cattle Outlook and Global Beef Situation
Canadian Cattlemen Market Development Council
Global Beef Situation
Demand
Global demand for food is increasing with growing populations and disposable incomes – all of which
supports beef consumption. Global beef consumption is projected to increase by 6% or 3.68 million
tonnes (carcass weight) over the next 10 years.
Global Beef Consumption 2012 -2021 Estimates
80
70
60
Million Tonne
While food demand has and is expected to continue
to grow - doubling by 2050, productivity increases
have lagged. Productivity is estimated to need to
increase by 1.75% annually to meet growing
demand. Currently agricultural production is only
increasing 1.4% annually. As global agricultural
ending stocks shrink, the implications from lower
production in any single year can be substantial.
The 2012 production year has been one with crop
production across many continents being lower
than expected due to drought in the U.S. Corn Belt,
South America and Russia.
Countries where
weather is still a concern include Australia and
India.
50
40
Non-OECD
30
20
OECD
10
12
13
14
15
16
17
18
19
20
21
Source: OECD/FAO Agricultural Outlook
Higher grain prices mean that consumers in emerging markets must spend more on food. There are a
number of differences from 2008 when staples such as wheat and rice were in short supply. In 2012 it is
primarily feed stuffs and oilseeds that are in short supply. Hence, protein and dairy prices are being
affected by higher input costs, as well as reductions in supply as production is reduced; particularly in the
pork and poultry sectors that are faster to respond to rises in the cost of production.
Food prices are expected to rise 12% in 2013 (FAO). Consequently many consumers that had started
consuming more protein will find they must adjust both consumption levels and type of product as more
food dollars are allocated towards staples. In order for demand rationing to occur prices are expected to
remain high over the next 12 months.
World-wide consumers are feeling the strain of higher food prices. While general inflation levels are
lower than 2008, food inflation will remain high in 2013. This along with higher debt levels in many
countries has slowed growth in protein consumption despite continued increases in disposable incomes.
Growth in beef consumption is still increasing; just at a slower pace than in previous years. As a luxury
product in many developing markets, grain-fed beef is targeting consumers that are less impacted by
these changes in food prices and income providing a more stable demand profile. More developed
markets like the U.S. have a more elastic demand for protein and are the least likely to decrease
consumption when prices increase.
As beef consumption grows there is still the question of who is going to supply product? Will it be
supplied from a growing domestic market or from imports? This depends not only on any country’s ability
to produce beef, but also on who has the product consumers prefer in any given market (grass or grainfed).
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The top five beef importers in 2020 are expected to be the USA (17%), Middle East and North Africa (17%),
Russia (12%), Japan (9.3%) and the EU (9%). South Korea is expected to be the seventh largest importer
(5%), Canada ninth (3.7%) and Mexico tenth (3.5%). This is relatively unchanged from the situation today
with the top four markets staying the same. The EU is expected to surpass South Korea as it moves into
fifth position and South Korea drops into seventh, but overall the major markets today are the major
markets of tomorrow.
Million Head
Thousand Tonnes (cwt)
Supplies
Global beef supplies have stabilized and are
World Cattle Inventories & Production
expected to remain tight over the short term with
Cattle Inventory
Production
further drought in the U.S. preventing expansion
54,000
1050
until 2015 or beyond. Australia is looking to
53,000
expand if weather permits. Similarly Argentina has
1040
52,000
entered the consolidation phase and is expected to
1030
51,000
expand over the next couple of years. This will
50,000
limit beef production from those two countries in
1020
49,000
the short term. Brazil is currently growing at a
1010
modest pace, but not as fast as domestic
48,000
consumption, which has resulted in product being
47,000
1000
98 99 00 01 02 03 04 05 06 07 08 09 10 11 12p
pulled from exports to supply the domestic market.
Of note is India, which has grown to be a major
exporter in 2012. As beef is primarily a by-product of the Indian milk industry, they may not be able to
sustain growth trends in beef production over the long term. As increased investments are made to
increase milk productivity per cow, it is expected this will reduce the number of cows needed in the
future. But over the short term they will be a major exporting force in the trim and lean grass-fed
markets.
Source: GIRA
Canadian beef production growth is expected to be slow, with the Canadian herd currently stabilizing and
expectations of expansion and increased beef production being several years away. Canada is in an
enviable position when it comes to producing grain-fed beef with a relative abundance of water and land
resources for grazing and feed grain production. While feed grain prices have increased and are expected
to remain high due to tight ending stocks, a significant portion of land in Canada (over 50 million acres) is
only suitable for grazing and is in tame or native pasture. This pasture is suitable for beef, bison or sheep
production with beef production being the major product. In addition Canada is in a more favorable
position than some other countries that want to expand, but are limited by land availability and/or
systemic drought issues. In many countries, a large number of acres have been converted away from beef
production towards crop production (particularly corn, soybeans and sugarcane) as the margin on crops is
higher than beef – making it a more attractive investment for producers.
It should be noted that the difference in cost of production between grain fed and grass fed has been
shrinking as land and labor costs increase in South America, narrowing the historic price advantage for
grass-fed production.
Exchange rates are an important aspect of any countries competitive standing in the international
marketplace. The Canadian dollar is expected to continue to trade around par in 2013 ranging between
$0.98-$1.05. It is important to note that while the Canadian dollar is strong compared to the U.S., this is
really a reflection of the weakness of the US dollar. This is the case with many countries, including
Australia, which is basically par with the Canadian dollar and relatively strong compared to the U.S. Over
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Canadian Beef and Cattle Outlook and Global Beef Situation
Canadian Cattlemen Market Development Council
the last 18 months the Brazilian Real has devalued making them more competitive. There are actually
more fluctuations in exporter currencies than importing countries. The combination of strong currencies
in many major markets and fluctuations means there are still opportunities for solid exports into non-U.S.
markets with minimal impact from the exchange rate. On the import side, the Mexican Peso drifted lower
in 2009 and has stayed soft since, making Canadian imports more expensive. It is interesting to note that
the Hong Kong dollar, which is pegged to the US dollar, tracks closely with the Euro.
Major volume exporters include India (17.5%), Australia (16.3%), Brazil (15.5%), the USA (14.2%), New
Zealand (6.2%) and Canada with 5.2% of global beef trade. With a lower dollar the U.S. has increased beef
exports over the last two years resulting in them surpassing Canada as the world largest exporter of grain
fed beef. Australia, which is typically thought of as a grass fed beef producer, has also become a
significant grain fed beef producer over the last several years. Australian grain fed production has
plateaued at 30% of slaughter.
While Brazil, Argentina and the U.S. export large volumes the majority of their beef production stays
within the domestic market. Countries with a high reliance on trade include New Zealand (83%), Australia
(65%), Uruguay (59%), and Canada (37.5%) – percentages exclude live slaughter exports for Canada and
Australia. These countries are in a position where they must have a higher focus on import market needs
and respond accordingly. That gives these countries an advantage as they listen to changing preferences
in demand and tend to be more nimble in adjusting to market needs. A couple of examples include
Australia’s move to provide grain fed beef to Asia; in contrast to the lack of response from Brazil resulting
in beef volumes going to the EU being cut in half from 2008 to 2010. So what is the next big thing
exporters will have to respond to? Beta Agonists…
Non-Tariff Trade Barriers
In 2012 Beta Agonists have been the headline story in international trade. A number of countries are
either banning the use of beta agonists, with a zero tolerance policy or issuing warnings to supplying
countries. Many of these countries have high offal consumption and are concerned about the higher
residual levels left in soft tissue than muscle cuts from these products. Many of these countries are not
going to follow the CODEX for Maximum Residual Levels (MRLs). This is a non-tariff trade barrier, so even
if technical access is there volumes do not necessarily move.
 Taiwan and China both had zero tolerance policies for Ractopamine (Opta-flex). While Taiwan has
made changes following the CODEX announcement in July 2012, the situation is not expected to
change for China. Peak exports to Taiwan were 7,900 tonnes in 2002, but were only 924 tonnes in
2011 and projected to be 231 tonnes in 2012. Peak exports to Mainland China were 2,650 tonnes
in 2002 and projected to be 1,000 tonnes in 2012.
 In July 2012, South Korea informed Mexico that it will ship back product if it is found to contain
Zilpaterol (main ingredient in Zilmax). Since then suppliers have been reluctant to ship product.
Nothing has been done officially. Right now Canada’s bigger issue in South Korea is that the U.S.
has a lower tariff rate (by 2.7%). Getting a Canadian-South Korea Free Trade Agreement with an
equivalent tariff must be a priority. Exports to South Korea peaked in 2000 at 20,500 tonnes and
are estimated to be 1,800 in 2012.
 Russia told Brazil this summer it wants no Ractopamine used. While they have not implemented
any official measures, indications are they will ban Brazilian plants if the request was not complied
with. Canada exported 10,000 tonnes of beef to Russia in 2010 but is projected to only reach
7,000 tonnes in 2012 with 68% of the volume being offal. A primary product exported from
Canada to Russia is livers, which is included in the soft tissue category of concern. In December
2012, Russia announced they will be testing to certify all beef and pork imported from Canada and
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Canadian Beef and Cattle Outlook and Global Beef Situation
Canadian Cattlemen Market Development Council

the U.S. is ractopamine free. This had been a growing market but growing protectionist actions as
they try to build a domestic herd will make it volatile over the next 5-10 years.
The EU has threatened to restrict Brazilian product due to Brazil’s government approving
Ractopamine and Zilparetol for use in finishing. Consequently the Brazilian government is looking
at ways to segregate product for the EU market. In the meantime they have suspended sales of
beta agonists until an agreement is reached with the EU. For North America all product going to
the EU is hormone free. Canadian exports to the EU are small right now; 437 tonnes in 2011 and
projected to be just under 900 tonnes in 2012. With the implementation of the Canada EU trade
agreement (CETA) exports could be significantly larger.
Bottom line: this issue is not going away. It is critical that withdrawal times be observed in all exporting
countries. Supplies are only useful if there is economically feasible market access. Countries with beta
agonist restrictions represent opportunity for hormone free programs looking to maximize carcass values .
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Canada Beef Inc. Marketing Strategy
Executive Summary
The 2013/14 Canada Beef Inc. Business Plan reflects the vision of the board of Directors. The plan is
aligned to deliver against the priority outcomes as defined in the three year Strategic Plan, as well as the
marketing goals outlined in the Canadian Cattlemen Market Development Council’s Market
Implementation Plan.



Build awareness for a Canadian beef identity/brand and the Canadian Beef Advantage
Achieve growth in traditional, existing, new and emerging markets
Maximize the total value realized by the Canadian beef industry
This is the first 12 month fiscal year for the organization after resetting its fiscal year-end, and the
strategies, tactics and budget reflect the 12 month term of the plan when compared to the inaugural plan
which ran from January 1, 2012 to March 31, 2013. The total budget of the 2013/14 marketing
implementation plan is $12,151,331. Revenues from industry (national and provincial check-off) and other
sources are $4,540,915. In order to successfully implement this plan, Canada Beef Inc. requests $7,610,416
from the Canadian Cattle Market Development Council.
Supply outlook projections provided by Canfax Research Services indicate cattle inventories are currently
stable; the calf crop coming forward was down 1.5% in 2011 and 0.2% in 2012. In 2013, domestic fed
production is projected to be down 1.5% from 2012, and if heifer retention increases, fed marketings could
be down 4%. Domestic non-fed slaughter is projected to be down 8.6% as the beef cow culling rate
stabilizes below the long term average. Cow marketings will continue to be encouraged with record high
prices from a strong trim market. Overall domestic beef production is projected to be 2.5% lower.
Considering the reduction in overall supply for the second consecutive year, the 2013/14 strategy focuses
on delivering a return on investment to stakeholders through incremental value increases in global markets
and creating value through a differentiated brand position leveraging our unique points of differentiation
and strong consumer confidence in the Canadian industry.
Industry Alignment
The strategy has been developed with input from industry partners. It includes tactics for ongoing strategic
alignment and product prioritization with targeted trade customers in key markets.
Marketing Strategy
In order to deliver a clear and concise strategy, four marketing priorities were identified which have guided
the organization through the development of the tactical activities. Our actions will be guided by the
principles of Connect, Consult, Communicate, and Collaborate with our channel partners.
 Brand Differentiation: The strategy will focus on the ongoing development and communicating a
differentiated brand position for Canadian beef, leveraging the attributes of the Canadian Beef
Advantage (CBA).
 Market Segmentation and Development: The strategy will ensure that resources are directed to
markets and segments that represent opportunities for incremental value and return on marketing
investments and efforts.
 Product and Industry Image: The strategy will enhance the overall consumer perceptions of Canadian
beef from a product and industry perspective. Strategies include leveraging trade partners, direct to
CCMDC Marketing Plan – 2013/14
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Canada Beef Inc. Marketing Strategy
Canadian Cattlemen Market Development Council

consumer marketing, and public relations and social media programs with consumers and key
influencers.
Stakeholder Connectivity: The strategy will ensure Canada Beef Inc. takes a leadership position in a
collaborative effort to enhance the industry’s ability to respond to challenges, communicate a
consistent Canadian Beef Brand message and transparently measure and communicate the benefits
delivered through National Check-off investment in Canada Beef Inc.
Brand Strategy Overview
The marketing strategy continues to focus on developing strong brand recognition for the Canadian Beef
Brand and on enhancing the awareness and understanding of key attributes of the Canadian Beef
Advantage (CBA). Ultimately it is the attributes of the CBA as they relate to both Canadian beef products
and the supply chain that support the value proposition for our industry and provide the basis to
differentiate Canadian Beef from our global competitors. The brand strategy also includes a
comprehensive consumer component that leverages the functional and emotional attributes of Canadian
beef and the supply chain. The consumer component will be executed across multiple channels including
our brand license partners in the target markets and retail and foodservice segments, mainstream and
social media, health influencers and stakeholders.
Domestic Market
The domestic market continues to be the most stable and highest value market representing 63% of
production. Canfax Research Services projects domestic imports to increase to reach historic average
levels of 28%. A strong domestic brand strategy will help to provide a compelling reason for Canadian
consumers to prefer domestic beef over import competitors and ensure confidence in the Canadian
industry.
The negative impact of the E.coli 0157-H7 related recall provided a reminder of the importance of
maintaining consumer confidence. After an initial negative impact, consumer confidence research showed
a continual improvement in confidence rates to the point where confidence measures were within typical
historic ranges. While the findings are certainly good news it is also important to note that the length of
time required for recovery indicates this event had a significant impact on consumer attitudes. Should
there be another major incident in a short time period the subsequent recovery period could be even more
extended. Therefore a strong commitment in communicating the food safety systems in Canada must be
maintained.
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Export Market Prioritization
Beef exports were down 8% in volume and up 6% in value from January to August 2012. They are expected
to end the year down 12%, as reduced domestic production in the fourth quarter will focus supply in the
home market. Export markets are critical to driving incremental value for Canadian production and
providing higher value markets for niche programs. However, it is critical to ensure the marketing strategy
is focused on allocating resources to markets that deliver the highest possible returns on CBI marketing
efforts. In order to identify the proper allocation of resources for export markets, 29 exporters were
engaged and asked to participate in a market assessment to assist in identifying priority export markets.
Exporters consisting of large Canadian beef packers, Canadian veal packers, smaller specialized Canadian
exporters and vertically integrated value chain Canadian branded beef programs provided feedback on
market priorities and products that are targeted for each market. Considerations were also given to
markets in which expanded access was expected to be realized before the beginning of the new fiscal
period. When compared to resource allocations from the current year, allocations were increased in Japan
as well as China and the Emerging markets of Middle East/Europe. Allocations were stable in USA, Latin
America, SE Asia (with an eye to emerging Asian markets) and a slight decrease in Hong Kong, due to the
relative maturity of the market.
Operational Alignment
Key learnings within the past year have resulted in a more efficient and consistent delivery of programs in
international markets. The traditional market boundaries have been blurred through the development of a
‘hub’ based approach in key export market regions of Asia and Mexico/Latin America. The approach
enables the organization to more effectively deploy and leverage resources in markets that represent value
opportunities.
Collaboration in Global Markets
In an effort to extend the reach of brand marketing initiatives, relationships with the Trade Commissioners
Service will be enhanced in key export markets. CBI staff will work collaboratively to provide marketing
tools, technical training on communicating CBA attributes and the brand positioning, as well as financial
support for promotional activities executed through embassy sponsored events.
Responsive to Changing Market Conditions
The implementation plan has been developed to provide the organization with flexibility to changing
market and access related conditions in global markets. In order to capitalize on potentially changing
market opportunities, an ‘Opportunity’ budget has been created with an allocation of $512,565.
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Canadian Cattlemen Market Development Council
Budget Allocation by Market
2013/14 Drivers and Objectives
Brand and Reputation
To have Canadian Beef
recognized for its premium
quality, safety and value in
priority markets
To enhance Canadian Beef
brand loyalty with
consumers
Risk and Reward
Utilize priority markets to
drive incremental product
values
People and Knowledge
Align industry stakeholders
to foster collaborative,
sustainable Canadian beef
solutions
To preserve/maintain
consumer confidence in the
Canadian beef industry
Performance Measurements:
The plan will be measured using a Performance Measurement Framework utilizing both short and longer
term indicators developed in year one of the three year plan. The measures include qualitative and
quantitative measures. Canfax Research Services will provide interpretive results for all qualitative results.
CCMDC Marketing Plan – 2013/14
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Canadian Cattlemen Market Development Council
Global Markets Summary
The global market plan and budget describe activities that have application in all markets. The activities
listed will be developed in the domestic market and executed for delivery in all markets.
Total Budget Global Programs: $1,087,000
Objective #1: To have Canadian Beef recognized for its premium quality, safety and value in priority
markets
Strategies:
1.1 Ongoing development of a differentiated brand positioning leveraging the CBA
Tactics
1 Ongoing development of global CBA resource tools utilizing print and electronic formats for trade directed
audiences
2 Development of Guide to Importing Canadian Beef for priority export markets
3 Development of iPad platform CBA marketing resource tool for global markets
4 Research with trade customers in the United States, Japan and China markets to determine value and
optimize positioning of CBA attributes
5 Consumer research to determine most effective brand positioning
6 Development of resource toolbox of consumer directed key messages and creative to leverage quality and
safety attributes of the CBA
7 Communications and key message delivery training for staff and board to ensure consistent comprehension
and delivery of the Canadian beef story and CBA.
8 CBA knowledge management
9 Global CBA advertising template
10 Global CBA E-Bulletins
11 Media outreach
Budget $450,000
1.3 Maximize the use of Media, Trade Events and Seminars, Trade Missions and Technical Resources
Tactics
1 Participation at SIAL, highlighting CBA attributes and innovative beef products to domestic customers and
media. Collaborate with Trade Commissioners to host incoming international trade customers and foreign
media delegates.
2 Distribution and storage of global marketing materials/resources
3 On-going development of all CBI web based properties to support marketing and communication
initiatives
4 CBA E Bulletins- Design of template and CBA lead story for 3 issues/year
Budget $190,000
Objective #2: Utilize priority markets to drive incremental product values
Strategies:
2.1 Utilize market research and intelligence to identify opportunities to maximize carcass value
Tactics
CCMDC Marketing Plan – 2013/14
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Canada Beef Inc. Marketing Strategy
Canadian Cattlemen Market Development Council
1
2
Utilize market representation to execute the Global Market Intelligence Report in global markets to
provide insights to industry partners to support management and investment decisions
Purchase market data in key markets to identify product opportunities to increase carcass cutout values
Budget $60,000
Objective #5: Align industry stakeholders to foster collaborative, sustainable Canadian beef solutions
Strategies:
5.1 Improve Communications, Connectivity and Collaboration across the industry.
Tactics
1 Creation of a quarterly industry statistics fact sheet directed at trade partners
2 Regular communications with communications peers in agricultural organizations and government officials
across Canada
3 Weekly stakeholder updates
4 Monthly trade updates
5 Quarterly Brand newsletter
6 Attend Provincial and industry meetings
7 Annual Forum
8 Advertising and advertorials targeting stakeholders
9 Participate in and align with key industry networks on key health and nutrition issues
Budget $217,000
5.2 Communicate broad industry awareness and support
Tactics
1 Collaborate with key industry associations including Canadian Meat Council, Retail Council of Canada,
Canadian Restaurant and Foodservice Association
2 Canada Beef producer website
3 Build a network of beef advocates and ambassadors through the Canada Beef Ambassador program
Budget $30,000
5.3 Identify points of strategic alignment
Tactics
1 Collaborate with provincial associations to execute coordinated marketing initiatives
2 Participate in strategic sponsorships and networking opportunities with Health professional influencers,
policy makers
Budget $20,000
5.4 Provide accurate and transparent activity reporting and performance measurements
Tactics
1
Complete in market performance surveys
2
Purchase of market data for performance measurements
3
Contract research with Canfax Research Services
Budget $120,000
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Canada
Market Summary
Canadian beef consumption was steady in 2011 at 946,977 tonnes. The domestic market is the largest and
most stable market; representing 63% of domestic production. In 2011 personal beef consumption was
20.1 kgs/capita the lowest level on record. Similarly, pork consumption has also trended down and hit a
new low of 15.8 kgs/capita. Poultry consumption has been steady since 2003 at 31.2 kgs/capita.
In the first nine months of 2012, Canadian retail beef prices are up 6.7%, pork prices are up 6.3% and
poultry prices are up 5.3%. Relative price ratios show that the beef/pork relationship at 1.46, is up from
the long term average of 1.4. Similarly, the beef/poultry relationship at 2.09 is also up from the long term
average of 2.0. Beef is more expensive compared to competing meats and it is also the slowest to respond
to market signals due to its longer production cycle. This puts it at a disadvantage when defending market
share.
While declines in consumption are important to monitor, the dynamic between consumption and retail
prices provide an indication of consumer willingness to pay for beef. The Canadian beef demand index has
been tracking lower since peaking in 2003 at 59.5. In 2011, demand was up 1.4% at 50.9 and is projected
to be up again in 2012 despite the largest E.coli recall in Canadian history happening in September 2012.
This is because retail prices have been higher, while supplies from January through August were basically
steady. Even in the fourth quarter anecdotal evidence suggests retail prices moved higher with the
shortage in supplies but demand remained relatively steady.
The wholesale beef index which monitors cutout values relative to domestic consumption (both retail and
foodservice) bottomed in 2010 and was up in 2011. Another increase is projected for 2012 as cutout
values have moved up 10% year to date, while domestic
Wholesale Beef Index
120
production is only projected to be down 5.6% in 2012.
Canadian beef represents 74% of the total domestic
consumption of 946,977 tonnes (carcass weight). Imports
represent 26% of domestic consumption and are close to the
historic average of 28% of the market being supplied by
imports. While total imports at 200,000 tonnes is just below
the historic average of 222,000 tonnes, a larger proportion of
that is supplied by the United States at 77% in 2012 versus
39% in 2002.
CCMDC Marketing Plan – 2013/14
100
90
80
70
60
50
40
99
01
03
05
07
09
11
Source: Schroeder & Pendell 2007, Canfax Research
Canadian Beef Consumption
1,200
Domestic
Imports
1,000
Thousand Tonnes
Demand for protein and in particular beef is dependent on the
economy and consumer willingness and ability to purchase.
Canadian consumers have increased personal debt loads with
the lower interest rates. Higher levels of debt have made
consumers vulnerable to any further increases in the interest
rate. Interest rates have currently been able to remain at low
levels with domestic recovery in Canada being slower than
originally expected, which has limited inflationary concerns
and the need to increase interest rates.
Index (2003=100)
110
800
600
400
200
0
90
92
94
96
98
00
02
04
06
08
10
Source: Statistics Canada
22
Canada Beef Inc. Marketing Strategy
Canadian Cattlemen Market Development Council
Implementation Plan
Total Budget Canada Programs $1,882,000
Objective #1: To have Canadian Beef recognized for its premium quality, safety and value in priority
markets
Strategies:
1.2 Position the brand to differentiate it in all viable markets
Tactic
1 Develop “Made in Canada” consumer directed brand marketing content that leverages the CBA attributes
and utilizes a unique positioning as determined through research
Budget $40,000
1.3 Maximize the use of Media, Trade Events and Seminars, Trade Missions and Technical Resources
Tactics
1 Host industry educational tours with major market leaders in retail/foodservice segments to enhance their
understanding of the CBA attributes
2 Technical seminars/events with market leaders in retail/foodservice segments to enhance understanding
of CBA attributes
3 Facilitate collaboration with trade media to further distribute the Canadian beef story to the end
consumer
4 Maximize message delivery and Canada Beef image at health professional trade shows
Budget $65,000
Objective #2: Utilize priority markets to drive incremental product values
Strategies:
2.2 Leverage brand license partners in key market segments
Tactic
1 Collaborate with brand license partners to market branded Canadian beef programs in the retail,
foodservice and processing segments
Budget $360,000
2.3 Collaborate with industry and channel partners to add value through innovative marketing and
merchandising programs
Tactic
1 Collaborate with market leaders in the retail and foodservice segments to host research and development
sessions to identify innovative product applications for undervalued cuts
2 Partner with market leaders in the retail, foodservice and processing segments to develop and market
innovative new beef products
3 Develop consumer usage messaging for undervalued cuts
4 Facilitate collaboration with trade partners to further distribute the Canadian beef story to the end
consumer through media channels
5 Develop and promote innovative product concepts within the processing sector that delivers increased
carcass utilization
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Canadian Cattlemen Market Development Council
Budget $175,000
Objective# 3: To enhance consumer loyalty to the Canadian Beef brand globally
Strategies:
3.1 Focus consumer marketing initiatives to leverage the emotional and functional attributes of Canadian
beef
Tactics
1 Launch a comprehensive consumer outreach initiative to communicate a compelling Canadian beef story
(featuring industry and product perspectives) through multiple market and media channels
2 Communicate the Canadian beef story to a diverse media audience through strategic communications,
media relations, event and seminar participation and sponsorship, and social media engagement
3 Nutrition communications to health professionals designed to improve attitudes towards beef as
nutritious and compatible with heart healthy and diabetic diets
4 Revision and distribution of infant feeding/iron brochure to ensures health professionals are aware and
are disseminating new Health Canada guidelines that promote beef as first food for infants
Budget $825,000
3.2 Conduct consumer and market research to benchmark current and ideal loyalty levels
Tactic
1 Conduct research to establish a benchmark for Canadian beef brand awareness with consumers
Budget $20,000
3.3 Enhance our understanding of consumer purchase habits
Tactic
1 Conduct research to enhance understanding of the purchase habits of Canadian consumers
2 Communicate key findings to trade partners and media
Budget $25,000
Objective #4: To preserve/maintain consumer confidence in the Canadian beef industry
Strategies:
4.1 Communicate a compelling Canadian beef story leveraging the industry’s commitment to continuous
improvement in animal health and food safety, environmental stewardship and sustainability
Tactics
1 Collaborate with industry to define and develop consumer messaging around sustainability, animal
health/welfare and environmental stewardship
2 Coordinated bilingual national scope public relations campaign utilizing both traditional and social media
to share a compelling Canadian beef story
3 Execute quarterly social media releases of key messages
4 Leverage key messages with major market leaders in retail and foodservice segments
5 Influence, support and use the Canadian Partnership for Consumer Food Safety Education efforts to reach
consumers on safe food handling messages for the home.
6 Update/develop backgrounders or factsheets on issues related to the beef industry
Budget $300,000
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4.2 Promote collaboration in the area of issues management
Tactics
1 Actively engage industry partners and government to ensure collaboration in providing responses to
emerging issues
2 Maintain an active role on the industry led Public Relations Response Team (PRRT)
3 Ongoing media monitoring and key messaging development for distribution to trade partners
Budget $22,000
4.3 Utilize research to enhance knowledge of consumer perceptions of Canadian beef industry
Tactics
1 Conduct ongoing consumer confidence tracking to measure levels of confidence in Canada’s food safety
systems and impact on purchase behaviours
2 Conduct consumer research to benchmark consumer perceptions of beef industry
Budget $50,000
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United States
Market Summary
Canada is in an advantageous position located next door to the world’s largest beef importer. Exports to
the United States represent 74% of Canadian beef exports for the first half of 2012 and represent 28% of
Canadian domestic beef production. Canadian product historically accounts for 2.4% of U.S. beef
consumption making it difficult to establish an overall presence. However Canada does have regions where
it has made its presence known. A quarter of Canadian beef exports go to California and the large Hispanic
market there, which has a higher per capita beef consumption than the national average. This market also
consumes many of the thin meats which are undervalued in Canada, making it an important market for
achieving equivalent pricing for certain under-utilized cuts.
United States Beef Disposition
Consumption
Imports
Exports
14.0
3.0
13.0
2.5
12.0
2.0
11.0
1.5
10.0
1.0
9.0
Imports & Exports
Million Tonne CWE
Production
Production & Consumption
Million Tonne CWE
Production
Despite steady declines in inventories, large
numbers of slaughter cows and increasing carcass
weights have supported beef production in the
United States with the first declines not seen until
2012 (-2.3%).
Even now severe drought is
supporting cow marketings above levels of a stable
herd. Production is projected to decline over the
next several years, with 2013 down another 3.8% as
the U.S. beef herd shrinks and smaller calf numbers
come forward.
0.5
8.0
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
7.0
0.0
U.S. domestic consumption declined from 2007 to
2011. As consumption was falling faster than
production exports grew over that period making
the U.S. a net exporter. Per capita consumption has been steady in 2012 and as a result exports are
projected to decline 11% and imports increase 14.5% (USDA). This stabilization in consumption is not
expected to continue with per capita consumption projected to be down another 4% in 2013. This will line
up with the decline in production allowing trade to stabilize in 2013. Overall exports are projected to
represent 10.8% of production in 2012.
Source: USDA, FAS, PSD
Moving forward any rebound in beef consumption in the U.S. is expected to be supplied from further gains
in carcass weights with little to no need to expand the cow herd. It has been evident that even with profits
over the last decade the U.S. beef cow herd has not expanded with resources going into other commodity
production instead. This focus on production numbers not inventory numbers as the true measure of the
cattle cycle is necessary to understand future movement. Any expansion in cow numbers will not occur
until 2015 as the country recovers from severe drought in 2012. Even then expansion is expected to be
modest and highly dependent upon growth in beef exports.
Consumption
The U.S. protein market is a mature market with growth in consumption primarily coming from population
increases. Food expenditures continue to take less of the consumer’s income. Over the past decade more
dollars have been spent away from home (at foodservice) then at home (bought at retail). The average
price of a meal at home is $2.37 versus $6.49 away from home.
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The country has been slow to deal with its burgeoning debt and fiscal policy issues, and now face a fiscal
cliff moving into 2013. Approximately 3% of consumer income is at risk if the government either raises the
debt ceiling or reaches gridlock. If the government does not raise the debt ceiling and the tax cuts are
removed automatic government spending cuts occur and the U.S. could enter some form of recession, with
the fiscal cliff representing around 3% of U.S. GDP. The subsequent decline in incomes and consumer
spending at foodservice would affect beef demand and consequently cattle prices.
This leaves open the very real possibility of reduced demand for protein as consumers cut spending in the
short term (Q4 2012 and Q1 2013). This risk has been somewhat mitigated by the fact that protein
supplies have declined in the U.S. to the point that they have reduced exports and increased imports. Any
weakening in U.S. beef demand will place negative pressure on prices. In light of this risk, it is important
for the Canadian beef industry to continue to focus on niche markets in any country that provides a price
premium for cuts.
Per capita beef consumption was down 3.8% in 2011 but is expected to be steady in 2012 before dropping
again in 2013 (by 4%). Slight population growth means total beef consumption will only be down 2.6% in
2013.
Declining cattle supplies have produced higher cattle
prices. As supply reductions continue to threaten beef
margins and pressure end users to pass higher
wholesale beef prices onto consumers - going forward
demand increases will become more important to
support consumption levels at higher prices.
The U.S. has strong demand for Choice product, as
evident by the seasonal increases in the Choice/Select
spread. The Choice/Select spread rallied in June to a
high of $20/cwt before declining back to $5/cwt the
beginning of August. Since then prices have followed
the rally that took place last year as seasonally supplies
of Choice beef tightened and prices moved higher with
stronger demand from Wal-Mart.
CCMDC Marketing Plan – 2013/14
U.S. Choice Retail Beef Demand Index
60
58
Demand Index (1980 = 100)
56
54
52
50
48
46
44
42
2012p
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
40
1990
Consumer Demand Trends
Beef demand has rebounded from the low seen in
2009. Part of this is due to a 4% increase in disposable
incomes. The Retail Beef Demand index was up 1.4% in
2011, but is expected to be down 1.5% in 2012. While
demand for Choice beef at retail was up in the first
quarter it was below year ago levels in the second and
third quarter. In March 2012, the media backlash
against Finely Textured Lean Beef (FTLB) negatively
impacted consumer perceptions of this product
softening demand for all beef. It should be noted that
the price of 85% trim actually increased as substitution
of product took place.
Source: KSU, 1999 U.S. Beef Demand Study
Canadian Beef Exports to the U.S. by
Product Type, 2011
Offal
4%
Veal
Misc 3% Bone In
8%
6%
Trim
41%
Boneless
Cuts
38%
Source: AAFC
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Beef Imports
U.S. beef imports were up 10% from Jan-Sept 2012 and are projected by USDA to end the year up 14.5%.
Imports have been supported by smaller domestic production and a more favorable exchange rate with
Australia. Canadian market share dropped in 2012 to 26.5% of total U.S. beef imports, while Australia
regained the top position with 29%. New Zealand comes in third at 21% then Mexico at 10%.
In the first half of 2012 Canadian beef exports into the United States were primarily trim (43%) and
boneless cuts (36%). The proportion of exports made up of boneless cuts has been declining from 44% in
2005. Bone-in cuts (4%), offal (4%), veal (3%) and miscellaneous items (10%) make up the balance with
bone-in cuts steadily growing from 1% in 2005 to 4% in 2012.
Implementation Plan
Total Program Budget U.S. Programs: $683,000
Objective #1: To have Canadian Beef recognized for its premium quality, safety and value in priority
markets
Strategies:
1.1 Ongoing development of a differentiated brand positioning leveraging the CBA
Tactic
1
Conduct competitive benchmarking research on priority cut performance and comparison analysis to
competing U.S. products
Budget $40,000
1.2 Position the brand to differentiate it in all viable markets
Tactics
1
Leverage the Canadian beef story in promotional and merchandising strategies
2
Execute targeted advertising campaigns in trade publications
3
Collaborate with Consulate General and Trade Commissioners to extend reach of Canadian beef brand
resources and support promotional activities
Budget $56,000
1.3 Maximize the use of Media, Trade Events and Seminars, Trade Missions and Technical Resources
Tactics
1
Participate in selected trade events representing priority markets and opportunity for priority products
2
Conduct incoming trade missions with targeted priority customers
3
Conduct technical seminars with trade customers to communicate CBA attributes and competitive
advantages compared to competing products
4
Enhance relationships with key industry associations and trade organizations as influential market leaders
5
Production and distribution of technical marketing resources
Budget $155,000
Objective #2: Utilize priority markets to drive incremental product values
Strategies:
2.1 Utilize market research and intelligence to identify opportunities to maximize carcass value
CCMDC Marketing Plan – 2013/14
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1
2
Tactics
Host in-market strategic planning sessions with senior sales and marketing representatives to forge packer
alignment and partnerships
Conduct in market field work with packer representatives to engage MDP activity for priority products
Budget $25,000
2.2 Leverage brand license partners in key market segments.
Tactics
1
Collaborate with brand license partners to market branded Canadian beef/veal programs in the retail,
foodservice and processing segments
2
Provide specialized training and education to targeted clients in retail and foodservice segments
Budget $92,000
2.3 Collaborate with industry and channel partners to add value through innovative marketing and
merchandising programs
Tactics
1
Enhance existing Canadian beef/veal programs and develop new Canadian beef/veal branded programs
2
Develop a HALAL brand marketing and merchandising program leveraging premium positioning
3
Enhance Canadian beef value on priority cuts through Canadian further processors exporting to the United
States
Budget $210,000
Objective# 3: To enhance consumer loyalty to the Canadian Beef brand globally
Strategies:
3.1 Focus consumer marketing initiatives to leverage the emotional and functional attributes of Canadian
beef
Tactic
1
Leverage the Canadian beef story content to build generic and customer specific materials/tools that
clients can incorporate in marketing programs.
Budget $20,000
3.2 Conduct consumer and market research to benchmark current and ideal loyalty levels
Tactic
1
Consumer research to determine consumer attitudes to Canadian beef and how to best position the
Canadian beef story approach
Budget $10,000
3.3 Enhance our understanding of consumer purchase habits
Tactics
1
Purchase research to direct activities in retail and foodservice segments
2
Outsource reputable research firms to provide analysis and actionable feedback on syndicated studies and
research papers
3
Enhance our understanding of trade preferences in the United States, Cuban/South American markets
heavily represented in states such as Florida, D.C., GA.
Budget $30,000
CCMDC Marketing Plan – 2013/14
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Objective #4: To preserve/maintain consumer confidence in the Canadian beef industry
Strategies:
4.1 Communicate a compelling Canadian beef story leveraging the industry’s commitment to continuous
improvement in animal health and food safety, environmental stewardship and sustainability
Tactic
1
Leverage the Canadian beef story with retail and foodservice partners in targeted market segments
Budget $20,000
4.2 Promote collaboration in the area of issues management
Tactic
1
Foster collaborative working relationships with influential U.S. industry associations
Budget $10,000
4.3 Utilize research to enhance knowledge of consumer perceptions of Canadian beef industry
Tactic
1
Further disseminate consumer focus group research findings from key markets to assess perceptions of
Canadian beef industry
Budget $5,000
Objective #5: Align industry stakeholders to foster collaborative, sustainable Canadian beef solutions
Strategies:
5.2 Communicate broad industry awareness and support
Tactic
1
Communicate stakeholders’ updates to trade audiences in target foreign markets
Budget $5,000
5.3 Identify points of strategic alignment
Tactic
1
Maintain strong strategic relationships with all Canadian beef/veal packers and exporters to ensure
alignment on key markets, market segments and brand positioning
Budget $5,000
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Latin America (Mexico, Cuba, Colombia, Puerto Rico)
Market Summary
Mexico is Canada’s second largest export market, accounting for 10% of Canadian beef exports;
representing 3.5% of Canadian production.
Mexico Beef Disposition
Production
Imports
Exports
Consumption
2500
1000 MT CWE
2000
1500
1000
500
2012
2009
2006
2003
2000
1997
1994
1991
1988
1985
1982
1979
1976
1973
0
1970
Mexico has been impacted by a one hundred year
drought which hit in 2011 and persisted in 2012. This
has resulted in larger domestic production over the
short-term, as first feeder cattle were slaughtered or
exported and then cows started moving to market.
Larger short term production has discouraged imports.
But over the long-run it will take a long while before
they regain previous production levels. In fact, cattle
inventories on January 1, 2012 at 20.09 million head
were 20% smaller than in 2000 and USDA is projecting
them to be another 12% smaller by 2014. Reductions in
the Mexican herd have far outpaced those in Canada or
the U.S. The question of rebuilding is not clear, with
weather being the main obstacle.
Source: USDA, FAS,
In 2012 pasture conditions have not improved. With 31 million head of cattle reproductive efficiency is on
average one calf per cow every two years. Mexico does not have the pasture production or feed to finish
that many cattle and therefore they continue to export around one million head to the U.S. annually. In
2012 this is expected to be over 1.5 million head. Reductions in the cow herd and larger feeder exports
have put pressure on the domestic packing industry that is facing smaller supplies. Falling slaughter
weights will also lower production and require increased beef imports in 2013.
Mexico has been growing their export markets to around 4-5% of production. Main destinations for
exports include the U.S. (60%) and Japan (33%), with prospects of larger volumes moving into Asia given
the free trade agreement with Japan. Focus has been placed on diversifying exports since 2011. Despite
growth in exports they are still dependent on imports for 16% of beef consumption. The region of Mexico
City consumes a lot of imported meat and domestic prices are determined by the metro area of Mexico
City. GIRA projects consumption to grow by 272,000 tonnes over the next decade. However some of this
will be provided by growth in domestic production once weather permits expansion.
Consumption and Consumer demand trends
Consumers are facing higher beef prices with higher feed costs, which are projected to be up 37% in 2013.
Beef prices have also been impacted by a weak peso (devalued 10% against the U.S. dollar in the second
quarter of 2012) driven by a soft economy and considerable food inflation, which has consumers looking
for alternatives. As such there has been trading towards pork, which has increased domestic production
and has lowered prices. Mexican’s are fond of Milanesa and Bistec (thin-muscle cuts) beef cuts taken from
the forequarter. Beef is typically consumed either grilled, in sauce, breaded or in traditional dishes such as
fajitas and burritos.
There has been a growing trend towards ‘meat boutiques’ in a few of the northern cities. These boutiques
are replacing butcher shops and provide a clean and warm environment for high income consumers who
are in search of fine cuts and special attention. These establishments allow consumers to select the cut of
CCMDC Marketing Plan – 2013/14
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their preference and decide if they want to consume the beef there or take it home. This is an emerging
trend that is looking to expand in central and southern Mexico and could be a potential opportunity for
higher quality cuts that serve the niche middle- and upper-income population.
Beef Imports
The majority of beef imports (98%) are fresh or frozen,
with limited processed product being imported (2%).
The U.S. is the largest supplier to the Mexican market
representing 79% of total imports. Imports from the
U.S. range from 500-750,000 tonnes (carcass weight)
annually. U.S. imports have been supported by
appreciation of the Mexican peso against the US dollar
giving importers an advantage. In addition, the
compensatory duties Mexico had been taking on beef
imports from the U.S. were removed in 2011. While
Mexico would like to be less dependent on the U.S. it is
difficult to find other suppliers who could provide the
level of volume required at a competitive price.
Canadian Beef Exports to Mexico
by Product Type, 2012 YTD
Offal
23%
Bone In
5%
Boneless
Cuts
72%
Source: AAFC
Canada is the second largest supplier and accounts for 21% of Mexican beef imports. The majority of beef
exported to Mexico from Canada is boneless cuts (72%), with offal (23%) and bone-in cuts (5%) making up
the balance. Historically, Mexico had a white fat market that fed cows would go into. Getting over-30month (OTM) beef access into Mexico would be a significant gain for Canada.
Colombia has been a net exporter of beef and cattle, particularly live cattle to Venezuela from 2004-09,
however trade disruption in recent years has confined production to the domestic market. Production had
increased over the last decade with the intention of growing exports. However, trade access has been
erratic resulting in volatile producer prices. There is potential of gaining access to other, more stable
exports markets if FMD is contained.
Implementation Plan
Total Budget Latin America Programs: $676,000
Objective #1: To have Canadian Beef recognized for its premium quality, safety and value in priority
markets
Strategies:
1.2 Position the brand to differentiate it in all viable markets
Tactics
1
Leverage the Canadian beef story in promotional and merchandising strategies
2
Execute targeted advertising campaigns in trade publications
3
Collaborate with Consulate General and Trade Commissioners to extend reach of Canadian beef brand
resources and support promotional activities
Tactic Budget $81,000
1.3 Maximize the use of Media, Trade Events and Seminars, Trade Missions and Technical Resources
CCMDC Marketing Plan – 2013/14
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1
2
3
4
5
Tactics
Participate in selected trade events in Mexico and Cuba
Conduct technical seminars with trade customers to communicate CBA attributes and competitive
advantages compared to competing products
Conduct incoming trade missions with targeted priority customers
Enhance relationships with key industry associations and trade organizations as influential market leaders
Production and distribution of technical marketing resources
Tactic Budget $240,000
Objective #2: Utilize priority markets to drive incremental product values
Strategies:
2.1 Utilize market research and intelligence to identify opportunities to maximize carcass value
Tactics
1
Work in coordination with Canadian packers to position Canadian priority cuts through Mexico´s food
service operators
2
Host in-market strategic planning sessions with senior sales and marketing representatives to forge packer
alignment and partnerships
3
Conduct in market field work with packer representatives to engage MDP activity for priority products
Budget $35,000
2.2 Leverage brand license partners in key market segments.
Tactic
1
Collaborate with brand license partners to market branded Canadian beef/veal programs in the retail,
foodservice and processing segments
Budget $130,000
2.3 Collaborate with industry and channel partners to add value through innovative marketing and
merchandising programs
Tactic
1
Continue to further develop existing differentiated value-added Canadian beef product lines
Budget $50,000
Objective# 3: To enhance consumer loyalty to the Canadian Beef brand globally.
Strategies:
3.1 Focus consumer marketing initiatives to leverage the emotional and functional attributes of Canadian
beef
Tactics
1
Leverage the Canadian beef story to build generic and customer specific materials/tools that clients can
incorporate in marketing programs
2
Work in collaboration with a high profile Mexican chef to develop creative application for Canadian beef
for Mexico’s cuisine in collaboration with the Canadian Embassy
Budget $55,000
CCMDC Marketing Plan – 2013/14
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Objective #4: To preserve/maintain consumer confidence in the Canadian beef industry
Strategies:
4.1 Communicate a compelling Canadian beef story leveraging the industry’s commitment to continuous
improvement in animal health and food safety, environmental stewardship and sustainability
Tactics
1
Leverage the Canadian beef story with retail and foodservice partners in targeted market segments
2
Work in collaboration with a high profile Mexican chef to develop creative application for Canadian beef
for Mexico’s cuisine in collaboration with the Canadian Embassy
3
Work collaboratively with associations such as Comecarne, Ameg, NAMA, AMI, ANTAD to facilitate factual
and timely information to industry partners in Latin American Markets.
Budget $55,000
4.2 Promote collaboration in the area of issues management
Tactic
1
Work collaboratively with associations such as Comecarne, Ameg, NAMA, AMI, ANTAD to facilitate factual
and timely information to industry partners in Latin American markets
Budget $15,000
Objective #5: Align industry stakeholders to foster collaborative, sustainable Canadian beef solutions
Strategies:
5.2 Communicate broad industry awareness and support
Tactic
1
Communicate stakeholders’ updates to trade audiences in target foreign markets
Budget $5,000
5.3 Identify points of strategic alignment
Tactic
1
Maintain strong strategic relationships with all Canadian beef packers and exporters to ensure alignment
on key markets, market segments and brand positioning
Budget $10,000
CCMDC Marketing Plan – 2013/14
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Japan
Market Summary
Japanese beef consumption is projected to grow by 63,000 tonnes over the next decade, with imports up
103,000 tonnes as domestic production is unable to keep up with demand. This 2020 projection has
consumption to be 12% below the 2000 pre-BSE levels, with an optimistic scenario of 0.5-1% consumption
growth per year. Japanese beef consumption is expected to be stable in 2013 with a continued lack of
income growth for consumers. Increased imports are expected to offset the decline in domestic
production (-3%).
Japan Beef Disposition
Production
Imports
Consumption
1,800
1,600
1000 MT CWE
Per capita beef consumption has been increasing since
2004 and is up 46% at 14 kgs surpassing the 2002 high of
13 kgs. While domestic production has increased in
response to stronger demand, imports have also been
increasing. Under the current access, it is difficult to
produce the desired AAA or Prime carcass in an under 21
month old animal.
1,400
1,200
1,000
800
600
2012
2009
2006
2003
2000
1997
1994
1991
1988
1985
1982
1979
1976
1973
1970
In early September 2012 Japan’s Food Safety
400
200
Commission (FSC) concluded its review of the domestic
BSE border measures. The FSC advised that the BSE risk
for U.S. and Canadian beef imports is negligible to
human health even if the age restriction was to be
increased to under-30-months (UTM). Japan will implement an amendment to its beef import
requirements enabling Canadian beef from cattle UTM to be eligible for shipment to Japan effective
February 1, 2013.
Source: USDA, FAS,
Moving to UTM access for North America is significant with larger supplies (lower prices) of the right kind
of beef available Japanese beef consumption is expected to rise. However, higher overall North American
beef prices in 2013 are expected to limit the level of increase in consumption in this price sensitive market.
Demand is expected to remain strong for value cuts like plate, chuck, and clod.
Surplus supplies of poultry meat are expected to limit beef and pork consumption growth. In 2012 the
foodservice sector has already replaced beef and pork dishes with lower priced poultry.
Japan imports 58% of the beef it consumes. Imports in 2012 are estimated to be 420,000 tonnes (CWE),
which is just under the 2003 high of 457,000 tonnes. While Japan does not want to become dependent on
U.S. beef again, consumers like and demand the product. The U.S. has made a strong return to the market
with 30% import market share. Australia (52% share) and New Zealand (15% share) continue to lose
market with smaller production at home. Canadian exports reached a high of 20,000 tonnes in 2000, but
are only expected to be 14,000 tonnes in 2012. In 2013 imports from the U.S. are projected to be up 5%,
while Australian imports are projected to be down 2%.
CCMDC Marketing Plan – 2013/14
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Implementation Plan
Total Budget Japan Programs: $736,000
Objective #1: To have Canadian Beef recognized for its premium quality, safety and value in priority
markets
Strategies:
1.1 Ongoing development of a differentiated brand positioning leveraging the CBA
Tactic
1
Conduct competitive benchmarking research on priority cut performance and comparison analysis to
competing import products
Budget $40,000
1.2 Position the brand to differentiate it in all viable markets
Tactics
1
Leverage the Canadian beef story in promotional and merchandising strategies
2
Execute advertising campaigns in target markets and segments
3
Collaborate with Consulate General and Trade Commissioners to extend reach of Canadian beef brand
resources and support promotional activities
Budget $85,000
1.3 Maximize the use of Media, Trade Events and Seminars, Trade Missions and Technical Resources
Tactics
1
Participate in selected trade events representing priority markets and segments
2
Conduct incoming trade missions with targeted priority customers
3
Conduct technical seminars with trade customers to communicate CBA attributes and competitive
advantages compared to competing products
4
Enhance relationships with key industry associations and trade organizations as influential market leaders
5
Production and distribution of technical marketing resources
Budget $226,000
Objective #2: Utilize priority markets to drive incremental product values
Strategies:
2.1 Utilize market research and intelligence to identify opportunities to maximize carcass value
Tactic
1
Purchase industry market data/research to identify product opportunities
Budget $10,000
2.2 Leverage brand license partners in key market segments
Tactic
1
Collaborate with brand license partners to market branded Canadian beef/veal programs in the retail and
foodservice segments
Budget $200,000
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2.3 Collaborate with industry and channel partners to add value through innovative marketing and
merchandising programs
Tactics
1
Promote value-added Canadian branded beef products with targeted customers
2
Conduct culinary events through the engagement of local culinary experts
Budget $70,000
Objective# 3: To enhance consumer loyalty to the Canadian Beef brand globally
Strategies:
3.1 Focus consumer marketing initiatives to leverage the emotional and functional attributes of Canadian
beef
Tactics
1
Collaborate with culinary experts to provide cooking classes based on the theme “Taste of Canadian Beef”
in conjunction with key retail partners
2
Leverage the Canadian beef story to build generic and customer specific materials/tools that clients can
incorporate in marketing programs.
Budget $100,000
Objective #5: Align industry stakeholders to foster collaborative, sustainable Canadian beef solutions
Strategies:
5.3 Identify points of strategic alignment
Tactic
1
Maintain strong strategic relationships with all Canadian beef packers and exporters to ensure alignment
on key markets, market segments and brand positioning
Budget $5,000
CCMDC Marketing Plan – 2013/14
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South Korea
Market Summary
South Korean beef producers responded to lower beef prices following the FMD outbreak in 2011 by
liquidating in 2012. Higher slaughter is projected to put domestic production up 19.3% and reduce
imports. A government program to remove 100,000 head of low quality cows in 2012 and 2013 is expected
to reduce total inventories by 2014 after seeing a 70% increase over the last decade. In 2013 domestic
production should be back down, which would support a recovery in import volumes. The domestic
market has also been pressured by higher feed grain costs as they import 90% from international markets;
this is expected to continue to encourage liquidation. Beef imports are projected to grow by 92,000 tonnes
in South Korea over the next decade.
Korea Beef Disposition
Production
Imports
Consumption
800
700
1000 MT CWE
600
500
400
300
200
100
2012
2009
2006
2003
2000
1997
1994
1991
1988
1985
1982
1979
1976
1973
0
1970
Abundant supplies of domestic product are projected to
increase beef consumption by 5% in 2012 with a smaller
increase in 2013. Despite larger supplies domestic
Hanwoo beef continues to be priced at a premium to
U.S. beef, particularly at foodservice. Consumption of
U.S. beef has increased following a TV ad campaign by
USMEF in early 2012. Consumers’ confidence in the
safety of U.S. beef has increased. This was particularly
evident following the forth BSE case found in California
in April 24, 2012, with only a few retailers pulling U.S.
product while the majority continued to sell U.S. beef.
Source: USDA, FAS,
Canada has market access to South Korea, but U.S. beef under the USKOR free trade agreement have a
lower tariff rate making them the preferred supplier. The tariff difference in 2012 was 2.7% - this increased
to 5.4% on January 1, 2013 and to 8% on January 1, 2014. The negotiation of a Canada-South Korean free
trade agreement is critical to prevent larger tariff differences and encourage the growth of Canadian beef
exports to this market. As of September, Canada and Korea were in the final stages of negotiations on a
FTA.
Implementation Plan
Total Budget South Korean Programs: $181,000
Objective #1: To have Canadian Beef recognized for its premium quality, safety and value in priority
markets
Strategies:
1.2 Position the brand to differentiate it in all viable markets
Tactics
1
Leverage the Canadian beef story in promotional and merchandising strategies
2
Execute advertising campaigns in target markets and segments
3
Collaborate with Consulate General and Trade Commissioners to extend reach of Canadian beef brand
resources and support promotional activities
Budget $28,000
1.3 Maximize the use of Media, Trade Events and Seminars, Trade Missions and Technical Resources
CCMDC Marketing Plan – 2013/14
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1
2
3
4
5
6
Tactics
Participate in selected trade events representing priority markets and segments
Conduct incoming trade missions with targeted priority customers
Conduct technical seminars with trade customers to communicate CBA attributes and competitive
advantages compared to competing products
Leverage relationship with culinary schools through educational events
Enhance relationships with key industry associations and trade organizations as influential market leaders
Production and distribution of technical marketing resources
Budget $105,000
Objective #2: Utilize priority markets to drive incremental product values
Strategies:
2.1 Utilize market research and intelligence to identify opportunities to maximize carcass value
Tactic
1
Purchase industry market data/research to identify product opportunities
Budget $5,000
2.2 Leverage brand license partners in key market segments.
Tactic
1
Collaborate with brand license partners to market branded Canadian beef/veal programs in the retail and
foodservice segments
Budget $20,000
2.3 Collaborate with industry and channel partners to add value through innovative marketing and
merchandising programs
Tactics
1
Promote value added Canadian branded beef products with targeted customers
2
Conduct Korean cooking competition in coordination with chefs’ association
Budget $15,000
Objective# 3: To enhance consumer loyalty to the Canadian Beef brand globally
Strategies:
3.1 Focus consumer marketing initiatives to leverage the emotional and functional attributes of Canadian
beef
Tactics
1
Development of a cultural mascot to deliver key consumer messaging
Budget $3,000
Objective #5: Align industry stakeholders to foster collaborative, sustainable Canadian beef solutions
Strategies:
5.3 Identify points of strategic alignment
Tactic
1
Maintain strong strategic relationships with all Canadian beef packers and exporters to ensure
alignment on key markets, market segments and brand positioning
Budget $5,000
CCMDC Marketing Plan – 2013/14
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China
Market Summary
Chinese beef consumption is projected to grow by 686,000 tonnes over the next decade. While domestic
production is projected to fulfill the majority of consumption needs, beef imports are expected to grow.
Beef production in 2013 is forecast to be up <1% to 5.58 million tonne. This small increase, for the first
time since 2008, is due to increasing domestic demand and government support for beef cows. Beef cow
inventories in 2013 are expected to be up slightly from 2012 due largely to increases in dairy production.
Beef production is expected to increase over the next couple of years with government support for genetic
improvement and expansion of larger sized commercial farms. The central government has been
subsidizing beef cow genetic improvement over the past few years. This subsidy tripled from US$3.14
million in 2010 to $9.43 million in 2011 and 2012. The 2013 subsidy is expected to be even higher. Large
commercial cattle slaughterhouses are signing more contracts with cattle producers and offering better
purchase prices than private cattle collectors to ensure stable cattle supplies.
In Mainland China relatively low domestic production and rising demand by the middle class is expected to
push beef imports up 12% to 34,000 tonnes (CWE) in 2013. Gains in middle class beef consumption are
slightly offset by declines in lower incomes segments. GDP growth slowed to 7.6% in 2012, which is the
slowest in three years with fewer property investments, weak exports and a soft stock market. Per capita
consumption is around 4 kgs. Uruguay has replaced Australia as the largest supplier, with Australia falling
to second place followed by New Zealand.
Earlier this year, China lifted its ban on Canadian boneless beef and bovine tallow on the conditions that
the cattle are UTM in age and that tallow is strictly used for industry purposes. Although shipments
resumed in May 2012, Canadian imports are to continue via Hong Kong in 2012 as Chinese importers and
Canadian exporters are still establishing terms and agreements. Traders in China note that Canada’s direct
shipments to China will be reflected in 2013 trade data. Canada is the first country in North America to
regain beef market access to China’s beef market. There are concerns about the residue levels of
ractopamine in soft tissue such as offals, which are consumed at a higher level in China as compared to
North America. As such the product moving into China is ractopamine free; representing an opportunity
for natural programs. Ractopamine is not an issue in Hong Kong, as it is not a prohibited substance
according to Hong Kong food law. Canada has full access for beef going to Hong Kong and Macau.
Implementation Plan
Total Budget Chinese Programs: $326,000
Objective #1: To have Canadian Beef recognized for its premium quality, safety and value in priority
markets
Strategies:
1.2 Position the brand to differentiate it in all viable markets
Tactics
1
Leverage the Canadian beef story in promotional and merchandising strategies
2
Execute advertising campaigns in target markets and segments
3
Collaborate with Consulate General and Trade Commissioners to extend reach of Canadian beef brand
resources and support promotional activities
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Budget $60,000
1.3 Maximize the use of Media, Trade Events and Seminars, Trade Missions and Technical Resources
Tactics
1
Participate in selected trade events representing priority markets and segments
2
Conduct incoming trade missions with targeted priority customers
3
Conduct technical seminars with trade customers to communicate CBA attributes and competitive
advantages compared to competing products
4
Leverage relationship with culinary schools through educational events
5
Enhance relationships with key industry associations and trade organizations as influential market leaders
6
Production and distribution of technical marketing resources
Budget $140,000
Objective #2: Utilize priority markets to drive incremental product values
Strategies:
2.1 Utilize market research and intelligence to identify opportunities to maximize carcass value
Tactic
1
Purchase industry market data/research to identify product opportunities
Budget $5,000
2.2 Leverage brand license partners in key market segments.
Tactic
1
Collaborate with brand license partners to market branded Canadian beef/veal programs in the retail and
foodservice segments
Budget $50,000
2.3 Collaborate with industry and channel partners to add value through innovative marketing and
merchandising programs
Tactics
1
Promote value added Canadian branded beef products with targeted customers
2
Conduct culinary competition in coordination with chefs’ association
Budget $50,000
Objective# 3: To enhance consumer loyalty to the Canadian Beef brand globally
Strategies:
3.1 Focus consumer marketing initiatives to leverage the emotional and functional attributes of Canadian
beef
Tactic
1
Leverage the Canadian beef story to build generic and customer specific materials/tools that clients can
incorporate in marketing programs.
Budget $16,000
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Objective #5: Align industry stakeholders to foster collaborative, sustainable Canadian beef solutions
Strategies:
5.3 Identify points of strategic alignment
Tactic
1
Maintain strong strategic relationships with all Canadian beef/veal packers and exporters to ensure
alignment on key markets, market segments and brand positioning
Budget $5,000
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Hong Kong
Market Summary
Hong Kong is a mature market with a population of 7.2 million growing at a rate of 0.9%. However, Hong
Kong continues to see significant increased tourist volumes, numbering over 42 million in 2012
(representing a jump of 16% from 2011). In 2012 pork has had the lowest retail price increase (3-4%)
relative to beef (10-12%) and poultry (5%). Hong Kong consumers are price sensitive, particularly when
food inflation is prevailing. Consequently the smaller increase in retail prices has encouraged some
consumers to replace some beef and chicken consumption with pork.
The volume of offals moving into Hong Kong remains high at 37%, but is down from 50% historically.
Tongue and hanging tenders are sold in Hong Kong, while other offal items tend to move into China.
Popular items such as omasum, tripe, tendon and strap are consumed in very versatile applications such as
hot pot, cold dishes, and some being reprocessed as value-added products.
The Hong Kong currency is pegged to the U.S. dollar. When the Hong Kong dollar depreciated against other
currencies, U.S. products became more price-competitive as a result of the currency peg. Pork importers
also commented that they have received very competitive offers from U.S. suppliers because products
have been rejected in other markets as a result of reasons such as ractopamine and quota limitations.
Importers have complained that the Hong Kong government has stepped up inspection rates for imports
regardless country of origin. To allow inspectors to do the inspection, shipments have to be taken to
warehouses and cannot be released before inspection. Importers complain that there are not enough
warehouses in Hong Kong and the entire procedure will incur additional costs for them.
Implementation Plan
Total Budget Hong Kong Programs: $190,000
Objective #1: To have Canadian Beef recognized for its premium quality, safety and value in priority
markets
Strategies:
1.2 Position the brand to differentiate it in all viable markets
Tactics
1
Leverage the Canadian beef story in promotional and merchandising strategies
2
Execute advertising campaigns in target markets and segments
3
Collaborate with Consulate General and Trade Commissioners to extend reach of Canadian beef brand
resources and support promotional activities
Budget $45,000
1.3 Maximize the use of Media, Trade Events and Seminars, Trade Missions and Technical Resources
Tactics
1
Participate in selected trade events representing priority markets and segments
2
Conduct incoming trade missions with targeted priority customers
3
Conduct technical seminars with trade customers to communicate CBA attributes and competitive
advantages compared to competing products
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4
5
6
Leverage relationship with culinary schools through educational events
Enhance relationships with key industry associations and trade organizations as influential market leaders
Production and distribution of technical marketing resources
Budget $80,000
Objective #2: Utilize priority markets to drive incremental product values
Strategies:
2.1 Utilize market research and intelligence to identify opportunities to maximize carcass value
Tactic
1
Purchase industry market data/research to identify product opportunities
Budget $5,000
2.2 Leverage brand license partners in key market segments.
Tactic
1
Collaborate with brand license partners to market branded Canadian beef/veal programs in the retail and
foodservice segments
Budget $25,000
2.3 Collaborate with industry and channel partners to add value through innovative marketing and
merchandising programs
Tactics
1
Promote value added Canadian branded beef products with targeted customers
2
Conduct culinary competition in coordination with chefs’ association
Budget $20,000
Objective# 3: To enhance consumer loyalty to the Canadian Beef brand globally
Strategies:
3.1 Focus consumer marketing initiatives to leverage the emotional and functional attributes of Canadian
beef
Tactic
1
Leverage the Canadian beef story to build generic and customer specific materials/tools that clients can
incorporate in marketing programs.
Budget $10,000
Objective #5: Align industry stakeholders to foster collaborative, sustainable Canadian beef solutions
Strategies:
5.3 Identify points of strategic alignment
Tactic
1
Maintain strong strategic relationships with all Canadian beef/veal packers and exporters to ensure
alignment on key markets, market segments and brand positioning
Budget $5,000
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Southeast Asia (includes Taiwan, Singapore, and Philippines)
Market Summary
Taiwan Beef Disposition
Production
Imports
Consumption
160
140
1000 MT CWE
120
100
80
60
40
20
2012
2009
2006
2003
2000
1997
1994
1991
1988
1985
1982
1979
1976
1973
0
1970
Taiwan imports 99% of the beef it consumes,
making it extremely reliant on global supplies and a
strong economy. Taiwan’s economy is heavily
reliant on trade with the U.S., particularly the trade
of electronics which they are facing increased
competition from South Korea and China. This
makes Taiwan vulnerable to fluctuations in the U.S.
economy and consumer confidence – ultimately
impacting disposable incomes in Taiwan, which
determine food expenditures and beef demand.
Taiwan’s GDP was down from initial expectations in
2012, with slower growth (1.66%) and higher
unemployment. With a slower economy consumers
have increased use of cheaper chuck items.
Source: USDA, FAS,
Taiwan has similar concerns about ractopamine as China, which resulted in increased testing in January
2011. This has resulted in export volumes to Taiwan plummeting in 2011 and moving lower yet in 2012. On
August 15, 2012 the Taiwan government announced it would be setting the ractopamine MRL for beef to
10 ppb. This is expected to come into effect in mid-September. As North America re-enters this market
they will be competing with Australia who has increased market share with grain fed beef free of beta
agonists.
Strong demand in both Taiwan and South Korea for short-ribs and other bone-in items means that Canada
getting access for bone-in products would be of significant benefit. The U.S. is expected to start
negotiations on a Trade and Investment Framework Agreement with Taiwan following the presidential
elections.
Asian beef consumption is well below Western levels. Many countries lack a tradition of beef or dairy in
their diets. Growth has been stunted by higher prices in recent years. Beef has a religious advantage in
some countries (Indonesia and Malaysia).
Malaysia GDP has grown over 5% in 2011 and 2012. Protein consumption is dominated by fish and poultry,
with beef consumed in limited quantities. The country is self-sufficient in broiler meat production with
imports of wings and parts (halal) coming from Thailand and Denmark. Surprisingly, even though the
country is an Islamic country with about 60% of the population being Muslim, pork is consumed in
significant quantity (higher than beef). There is a high dependence on imports for beef, mutton and dairy
products. Red meat is primarily imported from India. Trade is expected to grow over the next five years in
a variety of products as Malaysia has completed a number of bilateral trade agreements with neighbouring
countries. Traditional retail formats continue to lose ground to shops and superstores.
The Philippines is the only Christian country in Southeast Asia. The economy was once agriculture based,
but is turning towards electrical product manufacturing, providing jobs for the increasingly urbanized
population. It is projected that Philippines economy will achieve growth of around 4-5% during 2011 and
2012 following the slowdown in 2009 (1%) and recovery in 2010 (6%). The main proteins consumed are
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pork, fish and poultry. Protein consumption has grown steadily over the last decade surpassing 41 kgs per
person in 2010. Meat is sold through wet markets (90%) with limited supermarket activity (10%).
Livestock production is increasingly backyard with limited to no government support. Growth in the beef
industry is limited by the fact that beef is not a key dish as pork dominates the plate. While the domestic
herd is stagnant, a growing population has increased imports.
Beef imports (including carra-beef from India) was 105,000 tonnes (carcass weight) in 2012 up 4% from
2011. In 2010, India was the dominate supplier (56%) but with a shrinking market share as Australia (23%)
and New Zealand (6%) gain ground. About 98% of imports are boneless manufacturing beef for processed
products. Canada had 6% of the import market share in 2008 but this has dropped back to zero in recent
years, at the time it was thought a portion of this was moving into mainland China.
Vietnam is a densely populated, developing country. It weathered the global economic slowdown well but
has struggled with inflation in 2010 and 2011 and a stronger currency versus the United States. The United
States is the major supplier of protein to Vietnam. Total protein consumption has been growing steadily
since 2000. Pork is the dominant protein in this market (33 kgs), with a growing poultry consumption (13
kgs). Beef has made small gains (7 kgs). Changing lifestyles and growing influence of western media is also
contributing to the growth of beef consumption. Changing food preferences are occurring particularly for
the most lucrative urban consumers. The past five years has seen a rapid adoption of supermarket
shopping by younger Vietnamese in areas where there are supermarkets. Younger Vietnamese will be the
key factor in future changes in the distribution channels, because they are, and will be, a very large section
of the modern consumer market as it develops. It should be noted that about 30% of the population (28
million persons) are below the age of 18 years.
Despite a growing cattle herd (+3.7% per year over the last decade) an increasing supply gap has forced the
country to increase imports. Protectionist measures by government to control a flood of meat imports
have been reactive and highly confusing for importers. This is occurring at the same time that Vietnam is
phasing in tariff reductions under various trade commitments (WTO, ASEAN FTA, ASEAN-Aus-NZ FTA, and
ASEAN-China FTA). Consequently, beef prices tend to fluctuate wildly in Vietnam.
Beef and buffalo meat come from a variety of sources including Argentina, the U.S., Australia, New
Zealand, India, and Malaysia. Imports of buffalo meat from India have grown in volume and per unit value
over the last 10 years. Indian buffalo exports have grown rapidly to a very wide range of destinations.
Indonesia is spread across 18,000 islands and is the world’s fourth most populous country with 240 million
people and grows by around three million each year. It now has the largest Muslim population in the world
(88%) but also has a diversity of ethnic groups (around 300). There is considerable unrest as minority
groups have been attempting to gain independence from the central state since 1997. Around 60% of the
population relies on agriculture for income. Indonesia weathered the global economic crisis posting GDP
growth of 6.1% in 2010 with an expanding role of investment and exports.
Poultry is the number one protein source in Indonesia, with beef coming in a distant second followed by
pork. Indonesia is self-reliant in poultry meat and strong competition has companies seriously looking at
export markets. One of the industries main concerns is exchange rates as more than 40% of feed is
imported. In addition, the industry is still at risk of another avian influenza outbreak. Poultry meat is the
most affordable but also has significant growth potential with a low per capita consumption (approximately
7.5 kg/capita) compared to other Southeast Asian countries.
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The Muslim population requires halal meat which is presently domestically produced. Main suppliers of
beef are Australia and New Zealand with a large number of live cattle imported. The government has a
target to become self-sufficient in beef by 2014. In 2009, laws were passed that will allow imports of live
cattle and beef from a wider range of countries, including those not yet free from health issues such as
FMD (of particular interest was Brazil, but this would also open things to India). Imports of most live
animals have 0% tariff, while meat imports are generally 5%.
Asian Per Capita Beef Consumption
Indian Buffalo Exports, 2000-01 to 2011-12 (t pw)
Implementation Plan
Total Budget Southeast Asian Programs: $163,000
Objective #1: To have Canadian Beef recognized for its premium quality, safety and value in priority
markets
Strategies:
1.2 Position the brand to differentiate it in all viable markets
Tactics
1
Leverage the Canadian beef story in promotional and merchandising strategies
2
Execute advertising campaigns in target markets and segments
3
Collaborate with Consulate General and Trade Commissioners to extend reach of Canadian beef brand
resources and support promotional activities in Southeast Asian markets including Singapore, Vietnam,
Philippines and Taiwan
Budget $35,000
1.3 Maximize the use of Media, Trade Events and Seminars, Trade Missions and Technical Resources
Tactics
1
Participate in selected trade events in Taiwan and Singapore
2
Conduct technical seminars with trade customers in Taiwan to communicate CBA attributes and
competitive advantages compared to competing products
3
Leverage relationship with culinary schools in Taiwan through educational events
4
Enhance relationships with key industry associations and trade organizations in Taiwan
5
Production and distribution of technical marketing resources
Budget $68,000
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Objective #2: Utilize priority markets to drive incremental product values
Strategies:
2.1 Utilize market research and intelligence to identify opportunities to maximize carcass value
Tactic
1
Purchase industry market data/research to identify product opportunities
Budget $5,000
2.2 Leverage brand license partners in key market segments.
Tactic
1
Collaborate with brand license partners to market branded Canadian beef/veal programs in the retail and
foodservice segments
Budget $20,000
2.3 Collaborate with industry and channel partners to add value through innovative marketing and
merchandising programs
Tactics
1
Promote value-added Canadian branded beef/veal products with targeted customers
2
Conduct culinary competition in coordination with chefs’ association
Budget $30,000
Objective #5: Align industry stakeholders to foster collaborative, sustainable Canadian beef solutions
Strategies:
5.3 Identify points of strategic alignment
Tactic
1
Maintain strong strategic relationships with all Canadian beef/veal packers and exporters to ensure
alignment on key markets, market segments and brand positioning
Budget $5,000
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Russia, EU and Middle East and North Africa (MENA)
Market Summary
Russia is the world’s second largest importing nation, with strong growth in imports projected over the
next decade. Russia is currently Canada’s fifth largest market, with 2.5% of Canadian beef exports
destined to Russia.
Russian beef imports have more than doubled over the last decade from 350,000 tonnes in 2000 to
1,082,000 tonnes in 2010. Imports have been supported by a long term downtrend in domestic
production, while consumption has increased 22% to 2,724,000 tonnes. This has increased dependence
on imports from 15.6% to 40% of beef consumption. Beef imports are projected to grow by 92,000
tonnes over the next decade. While the government committed years ago to expand the pork and
poultry sectors to reduce dependence on imports, cattle were excluded until recently. Even with
enhanced government programs to increase domestic beef production, beef production is expected to
grow primarily as a by-product of an expanding dairy sector. This leaves an opportunity for suppliers of
higher quality beef.
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
1988
1000 MT CWE
Over the near term Russian dairy inventories have
been shrinking with liquidation in 2011 and into
Russia Beef Disposition
2012. A smaller dairy herd means less beef
Production
Imports
Consumption
production despite efforts to increase the beef
6000
herd. Cattle inventories are projected to increase
5000
by 0.7% on January 1, 2013 (+24% in beef herd).
Despite the large percentage increase in the beef
4000
herd overall numbers remain insignificant, with
3000
the dairy herd continuing to dominate overall
2000
production. The Development of Beef Cattle in
Russia 2009-2012 program is focusing on
1000
intensifying feedlot utilization in order to increase
0
carcass weights and increasing cattle inventories
for slaughter. The goal is for domestic production
to supply most of Russia’s beef needs by 2018-20.
Overall growth in domestic beef production will be driven by profitability in the dairy sector.
Source: USDA, FAS,
Consumption and Consumer Demand Trends
Larger consumption has been driven by rising annual disposable incomes, which have increased by 25%
from 2000 to 2008 and resulted in expanding consumption in the middle class. However, large
disparities between the poorest and wealthiest segments remain. Russia’s economy has been
supported by oil and gas prices with annual GDP expected to be back at 2008 levels by 2012.
There have been mixed reports about the Russian high-end chilled beef market. Statistics show that
consumption was stable with a growth in high-end restaurants and steakhouse options. However, the
demographic of very wealthy consumers this market targets is limited. Growth in this sector requires a
lower priced option between the very high end and current retail market. This requires a family style
steakhouse that provides a lower priced option of high quality frozen loin cuts. Other secondary
products can be developed for the high-end foodservice sector but would need to target the
appropriate end user and facilitate consumer education, as the Russian consumer tends to order loin
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cuts and do not look for alternatives. As Canada has a strong demand for loin cuts and commands a
premium over U.S. prices other cuts would need to be explored.
Beef consumption is expected to be flat in coming years with a modest decline in production and a slight
increase in Tariff Rate Quota (TRQ) volumes for “high quality” beef. As of February 2012, high quality
beef under Russia’s WTO commitments will be provided quota free access at a fixed tariff rate of 15% ad
velorem. Currently such exemption is only provided to beef with values above €8/kg. High quality beef
will be defined as chilled not frozen. Canadian product competes directly with U.S. and Australian
imports for the high end market. However, there is a lot of room for growth in this sector. Major beef
suppliers include Brazil (40%), Uruguay (11%), the EU (9.5%), and Argentina and Australia (both at 6.5%).
Total beef imports were down 6.6% in the first half of 2012.
European Union (EU) Market Summary
Imports & Exports
Million MT C
…
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Production & Consumption
The European Union (EU) has been on a long term trend of declining beef production, as domestic
agricultural support programs are reduced. Beef consumption is down 9% since 2007 and is declining
faster than production resulting in EU being a net
EU-27 Beef Disposition
exporter in 2011. Consumption is projected to
decline again in 2012, with a potential recession will
Production
Consumption
Imports
Exports
keep it in a net export position. The question
9.0
2.0
becomes will EU beef consumption rebound in the
next 10 years or will the current economic
8.5
1.5
uncertainty have a longer lasting impact that would
reduce demand for imports over the next decade?
8.0
1.0
With reduced Common Agricultural Policy (CAP)
funding domestic production is expected to decline.
7.5
0.5
At the same time increased market access
supporting supplies at lower prices will make
7.0
0.0
imports competitive and is expected to support
consumption in the future.
Source: USDA, FAS,
Current exports are supported by a low Euro with exports to MENA, and Turkey shifting in 2012 from
meat to live cattle. Exports to China are primarily frozen product through grey channels, dominated by
offal product.
Middle East and North Africa (MENA) Market Summary
The MENA region is made up of 20 relatively distinctive countries. The region represents 17% of world
cattle and beef trade. The current population of 0.47 billion people has expanded by 80 million over the
last decade and continues to grow at a rate of 2% per year. While facing limited water resources, the
region exports fossil fuels that support imports. However, high levels of government spending have
fueled inflation. Per capita GDP is relatively low with population growth exceeding GDP growth. Many
Gulf countries are also characterized by large foreign populations, primarily from southern Asia
(including India) which fill the oil related labour demand while leaving unemployment rates in the
domestic population high.
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Protein demand in the region has been affected by the growing urbanization. While rural populations
have had access to sheep, the intensively produced poultry industry has become the preferred choice of
urbanites.
Per capita beef consumption is currently estimated to be around 8.5 kg with huge potential to growth as
incomes increase. During the 2000s, per capita consumption rose steadily (4.4% per year), from 6.3 kg
in the 1990s as a result of growing imports from Brazil and India. Regional consumption rose sharply in
2010-12 on the back of rising import demand, notably by Turkey. Continuing strong import demand in
2013 is expected to see these high consumption levels maintained. Total beef consumption has
increased +6.3% per annum, surpassing per capita growth with population. Total consumption was
stable in 2012, but is projected to slightly increase again in 2013.
This is a large but extremely price sensitive region. Egypt, Turkey and Iran are the most important beef
consuming countries, accounting for around 60% of regional consumption. Other significant consumers
include Israel, Algeria, Morocco, Lebanon and Saudi Arabia, which account for a further 20% of regional
consumption.
Between 2001 and 2011 domestic production
increased by 4.5% per annum but has
plateaued since 2010. Consequently, selfsufficiency has fallen to around 63%. Live
cattle imports grew very strongly from 20092012 (+6.2% p.a.).
However, starting in
October 2012 import duties on live cattle
increased. In general, import tariffs in the
region average over 20% and are among the
highest in the world. Efforts to increase
domestic production have been largely
confined to Iran, Egypt and Turkey. But there
are challenges with: reliance on imported feed,
FMD, inefficiencies at feedlots and large
processors changing to slaughter imported cattle.
MENA Beef Production
Major suppliers
In addition, to live imports there has been a +11.6% p.a. increase in beef imports. India is by far the
major beef supplier into this region (36% of beef imports) having introduced their product at a lower
price (under-cutting Brazilian product), then steadily increasing volumes. India primarily supplies Egypt,
Saudi Arabia, Jordan, UAE, Iran, Iraq, Algeria, Kuwait, and Syria. Brazil has dropped to second place (33%
of imports) supplying a wide range of markets, key ones including: Egypt, Iran, Saudi Arabia, Israel and
Libya. The U.S., who trails well behind the other two as the third largest supplier, has been successful
exporting to Egypt, UAE, Saudi Arabia and Kuwait. The EU has increased supplies into the region
particularly live exports from France to Turkey. In 2011 and 2012 Turkey was the largest importer of live
cattle: 48% of MENA imports (2011) and 38% (2012).
Egypt, Iran, Saudi Arabia, Jordan, UAE, Israel, Algeria and Kuwait accounted for 83% of beef imports.
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Implementation Plan
Total Budget for Russia, EU, & MENA Programs: $267,000
Objective #1: To have Canadian Beef recognized for its premium quality, safety and value in priority
markets
Strategies:
1.2 Position the brand to differentiate it in all viable markets
Tactics
1
Leverage the Canadian beef story in promotional and merchandising strategies
2
Execute advertising campaigns in target markets and segments
3
Collaborate with Consulate General and Trade Commissioners to extend reach of Canadian beef brand
resources and support promotional activities
Budget $50,000
1.3 Maximize the use of Media, Trade Events and Seminars, Trade Missions and Technical Resources
Tactics
1
Participate in selected trade events representing priority markets and opportunity for priority products
2
Conduct incoming trade missions with targeted priority customers
3
Conduct technical seminars with trade customers to communicate CBA attributes and competitive
advantages compared to competing products
4
Enhance relationships with key industry associations and trade organizations
5
Production and distribution of technical marketing resources
Budget $130,000
Objective #2: Utilize priority markets to drive incremental product values
Strategies:
2.1 Utilize market research and intelligence to identify opportunities to maximize carcass value
Tactic
1
Purchase market research to identify markets and segments that offer incremental value growth
Budget $10,000
2.2 Leverage brand license partners in key market segments.
Tactic
1
Collaborate with brand license partners to market branded Canadian beef/veal programs in the retail and
foodservice segments
Tactic Budget $40,000
2.3 Collaborate with industry and channel partners to add value through innovative marketing and
merchandising programs
Tactic
1
Promote value added Canadian branded beef products with targeted customers
Budget $17,000
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Objective #4: To preserve/maintain consumer confidence in the Canadian beef industry
Strategies:
4.1 Communicate a compelling Canadian beef story leveraging the industry’s commitment to
continuous improvement in animal health and food safety, environmental stewardship and
sustainability
Tactic
1
Leverage the Canadian beef story with retail and foodservice partners in targeted market segments
Budget $10,000
Objective #5: Align industry stakeholders to foster collaborative, sustainable Canadian beef solutions
Strategies:
5.3 Identify points of strategic alignment
Tactic
1
Maintain strong strategic relationships with all Canadian beef packers and exporters to ensure alignment
on key markets, market segments and brand positioning
Budget $10,000
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Canada Beef Inc. Operating Budget
April 1, 2013 to March 31, 2014
Revenue
CCMDC
NCO
Others
$
7,610,416
4,504,915
36,000
$
12,151,331
Expenses
Global
United States
Japan
South Korea
Latin America
China
Hong Kong
Southeast Asia
Middle East/Europe
Opportunity
Canada Programs
Canada Staff and Office Costs
$
$
Programs
1,087,000
683,000
736,000
181,000
676,000
326,000
190,000
163,000
267,000
512,565
1,882,000
Overheads
1,478,912
259,748
Market Representation
Total
$
2,565,912
942,748
1,093,318
372,388
1,025,134
538,032
483,398
308,019
382,578
512,565
1,882,000
2,045,239
12,151,331
357,318
191,388
349,134
212,032
293,398
145,019
115,578
2,045,239
3,899,477 $
6,703,565 $
1,548,289 $
Surplus/(Deficit)
$nil
Canada Beef Inc
Operating Budget for the year ended March 31, 2014
Proposed Spending
Global
USA
Latin America
Japan
Hong Kong
China
Korea
S.E. Asia
Middle East/Europe
Opportunity
Canada
Programs Overheads
1,087,000
1,478,912
683,000
259,748
676,000
349,134
736,000
357,318
190,000
293,398
326,000
212,032
181,000
191,388
163,000
145,019
267,000
115,578
512,565
1,882,000
2,045,239
6,703,565
5,447,766
Total
2,565,912
942,748
1,025,134
1,093,318
483,398
538,032
372,388
308,019
382,578
512,565
3,927,239
12,151,331
CCMDC Marketing Plan – 2013/14
Proposed Revenue by Source
Check Off, Reserves & Others
Legacy
Check off Reserves Others
Total
CCMDC
AIBMDF
641,478
641,478
1,924,434
235,687
235,687
707,061
256,283
256,283
261,850
507,000
273,330
273,330
267,989
552,000
120,850
120,850
220,049
142,500
134,508
134,508
159,024
244,500
93,097
93,097
143,541
135,750
77,005
77,005
108,764
122,250
95,644
95,644
86,683
200,250
128,141
128,141
384,424
2,448,892
36,000 2,484,892
1,442,347
4,504,915
-
36,000
4,540,915
5,706,166
1,904,250
Total
Total
1,924,434
707,061
768,850
819,989
362,549
403,524
279,291
231,014
286,933
384,424
1,442,347
2,565,912
942,748
1,025,134
1,093,318
483,398
538,032
372,388
308,019
382,578
512,565
3,927,239
7,610,416
12,151,331
54
Canada Beef Inc. Marketing Strategy
Canadian Cattlemen Market Development Council
Canadian Beef Breeds Council Marketing Strategy
Executive Summary
The Canadian Beef Breeds Council (CBBC) has developed it’s 2013/2014 Marketing Plan while at the
same time undertaking a major organizational review.
CBBC is a diverse organisation representing eighteen (18) Beef Breed Associations, ten (10) Export firms
and four (4) Fairs or Exhibitions within Canada. All these members make significant efforts to market
quality Canadian genetics to the both domestic and international markets while promoting the Canadian
Beef Advantage. Our Breed Associations are responsible for the protection of the integrity of the
pedigree records of their respective breeds. They are also charged with effecting genetic improvement
of their seedstock. Genetic improvement is sought primarily to improve the quality and demand for
genetics within our own country but improved quality also assists in advancing the Canadian Beef
Advantage internationally.
Historically CBBC members have been perceived as not having focus when it comes to developing new
markets but rather responding to any and all international inquiries without a framework, strategy or
guide to this development. This plan, built on a longer terms strategic framework, is CBBC’s first steps
towards a more rational and organized approach to this market development for its members. This plan
recognises that we must still commit efforts towards maintaining our lucrative traditional and
established markets while, in parallel, looking at new markets elsewhere as a strategy for market
diversity, growth and sustainability.
This market development plan was informed by a series of extensive member interviews and committee
discussions to set a long term strategic framework and targets for growth in priority markets through
productive and high performance activities. The industry is, in part, dependent on particular breedspecific niche markets that are significant to a few of our members we felt could not be ignored. As
such, we are proposing a diminishing level of support for market development activities that will
subsidize high risk initiatives at a higher level than those in more established or easier markets. The
intent is to provide this risk determined level of support without exceeding the fifty percent.
As with previous plans, market development activities of breed associations and associate members
consists of inbound and outbound missions, attendance at trade fairs and breed congresses. Also as in
previous years, we seek support for after sales training and support – ensuring that the genetic stock
that are sold in overseas markets are properly expressed through correct feeding, care and breeding
practices that are particular to the breed.
CBBC member breed associations exist primarily to provide registered seedstock for the Canadian cattle
industry and our Canadian market will always be a high priority. The Council will be dedicating
significant effort during the tenure of this plan to enhance visibility and promotion of Canadian beef
cattle genetics within our own country. Equally, the International market offers an opportunity to
capitalize on our investment in genetic improvement and increase the profitability of our sector through
diversification into risky markets with greater growth potential.
During our deliberations we have identified potential synergies within the overall industry and can see
potential value in future cooperation and sharing within the industry. Specifically we include in our plan
an enhanced relationship and reporting agreement with Canfax. We are also seeking a higher level of
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Canadian Cattlemen Market Development Council
collaboration and cooperation with other groups and organizations representing the various segments
of the beef cattle value chain. These include the Canadian Cattlemen’s Association, the Beef Cattle
Research Council, the Canadian Food Inspection Agency and the Beef Cattle Trade Advisory Group. In
particular, we seek greater partnership with Canada Beef Inc, Canadian Genetics Livestock Association
and key association members including Agribition, the Canada Bull Congress and Farmfair International
in order to leverage our respective resources and networks, particularly internationally, to facilitate
broader industry growth than could be achieved if we acted independently. Importantly, we share with
each of these organizations the common objectives of enhanced market access and the need for shared
market intelligence.
This plan allows CBBC Members enough flexibility to support existing markets while focusing our major
resources on new and emerging markets and is requesting funds in the amount of $797,250 to achieve
this.
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Genetics Environmental Scan 2012
Table 1: Canadian Beef Cattle Genetic Exports
Value (Million $)
Breeding Cattle
Semen
Embryos
Total
Volume
Breeding Cattle (head)
Semen (units)
Embryo (units)
2006
0
$8.03
$0.44
$8.47
2007
$12.00
$3.98
$3.60
$19.58
2008
$33.10
$3.89
$4.02
$41.01
2009
$8.92
$5.46
$1.11
$15.48
2010
$8.00
$10.30
$2.07
$20.37
2011
$13.86
$9.40
$2.43
$25.69
2012p ⱡ
0
548,517
8,797
4843
316,275
6,771
16,606
403,601
5,229
4,621
111,775
4,833
3,387
250,038
4,894
4,975
541,256
3,658
4,000
250,000
1,000
Source: CFIA, Statistics Canada, Canadian Embryo Transfer Association (CETA)
ⱡ 2012 data is estimated based on current data, however final numbers are expected to change significantly as data tends to be reported once
at the end of the year.
The following analysis is based on trade data from Statistics Canada and CFIA for beef breeding cattle,
and semen. A combination of Statistics Canada, CFIA and the Canadian Embryo Transfer Association
(CETA) data are used for beef embryo exports. The 2012 data is preliminary with the totals expected to
increase as final numbers are reported. Canadian data is thought to be under-reported with import
country statistics showing higher volumes and values going into individual countries. Therefore, it is
important to focus on overall trends and not individual data points.
The additional income provided to the cow/calf sector from the sales of genetics is an important aspect
of the resiliency of this sector. The genetics industry is recognized as a piece of the entire beef industry
picture that is needed to keep the cow/calf sector healthy and progressive in adopting productivity
advancements in a variety of research areas including feed efficiency, reproductive efficiency and
carcass weights. International trade of cattle genetics tend to pave the way for future beef access;
examples include Russia, Colombia, and Kazakhstan. Genetics trade strengthens and broadens the
genetic base of the Canadian beef herd, and supports the beef industry by enabling it to be competitive
in a global marketplace.
In 2011, beef genetic exports totaled $25.7 million with live breeding cattle of 4,975 head valued at
$13.9 million, semen at 541,256 units valued at $9.4 million and embryos at 3,658 units valued at $2.43
million. In 2012, Canada has exported live cattle from 17 breeds into four markets, semen from 17
breeds into 28 markets and embryos from 11 breeds into 15 markets.
Live Breeding Cattle
In 2011, live breeding cattle exports totaled 4,975 head valued at $13.86 million. From January to
October 2012 exports have reached 3,463 head valued at $9.74 million1. The U.S. continues to dominate
the market with 2,058 head, followed by Kazakhstan with 1,219 head, Russia (234 head) and Mexico (44
head)2.
1
2
Source: Statistics Canada
Russia and Mexico volumes reported by CFIA
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Table 2: Live Breeding Cattle: Breeds Exported from Canada by country of Destination
2011
United States (55%)
Kazakhstan (41%)
Russia (2%)
Angus (28%)
Hereford (50%)
Angus (35%)
Hereford (9%)
Angus (24%)
Hereford (1%)
Simmental (7%)
Charolais (16%)
Piedmontaise (6%)
And 13 other breeds
2012
United States (61%)
Kazakhstan (19%)
Russia (15%)
Angus (46%)
Crossbreds (100%)
Angus
Crossbred (25%)
Simmental (10%)
Hereford (5%)
Charolais (4%)
And 11 other breeds
*Percentages do not add to 100% because of crossbreds/unknown breeds.
Mexico (2%)
Angus (39%)
Hereford (30%)
Simmental (19%)
Gelbvieh (12%)
Mexico (3%)
Angus (55%)
Simmental (27%)
Braunvieh (14%)
Hereford (2%)
Charolais (2%)
The U.S. and Mexico have both been severely impacted by drought the last two years and have
consequently liquidated their cow herds. As weather permits, these producers will be looking to
restock. However, high feed costs will make producers leery of investing until they are confident of feed
supplies and pastures have adequately recovered.
Cattle genetics in Mexico have improved in recent years with the best genetics found in the south with
crossbreeds <50% Zebu and >50% European breeds (Angus, Hereford, Charolais). The best animals are
exported to the U.S. for finishing. English crossbreeds (mostly Hereford) are found in the Northwest and
North-central regions while Continental crossbreeds (Santa Gertrudis, Brangus) are found in the
Northwest.
There is demand for beef cattle in Kazakhstan although not necessarily for purebred cattle. Commercial
breeding stock is being taken as the government currently has a program that covers $1,400 for each
breeding animal imported, which has discouraged higher priced purebred cattle from entering. While
Canadian purebred cattle were shipped in 2011, only crossbred or unknown breeds were shipped in
2012. Value needs to be shown for purebred cattle to justify the higher price.
Russian government investment into the beef industry has been smaller than pork and poultry
historically and resulted in less interest as it has a much longer payback period (around eight years).
Recent government direction and support for beef production is expected to support herd growth. U.S.
genetics have been imported but these are limited scale projects that are not widespread. Overall, the
beef sector is a small part of the total with beef cows representing only 2.3% of total cow inventories
(around 500,000 head). Significant growth would be needed before imports were displaced. Dairy
demand has been increasing but with improved milk yields the herd is expected to decline supporting
further beef imports. Following their joining the World Trade Organization (WTO) in August 2012, Russia
will have a flat tariff on beef of 27.5% with no quota. Beef prices both domestically and for imports have
been steadily rising since 2000. Higher prices will support production.
Angus is the dominate breed exported accounting for 45% of the total 2012 January to November
volume, followed by Crossbreds (36%), Simmental (7%), Hereford (3%), and Charolais (3%). There were a
total of 16 different breeds exported in 2012.
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Semen & Embryo Exports
Both semen and embryo export sales have distinct volume and value markets. Some countries import
large volumes at relatively lower per unit values, while other countries import limited volumes at higher
per unit values. Therefore, targeting a high value market can result in total volumes actually decreasing.
Both high and lower value markets have a place in a global marketing strategy as Canadian genetics
become known and demanded in mature, developing and emerging markets. Due to logistics semen and
embryos have the advantage of being shipped longer distances compared to live cattle, creating
awareness of quality Canadian beef in countries where live breeding cattle are not present.
Semen export volumes reached 541,256 units in 2011 and are at 231,855 units from January to
November 2012 putting volumes back to a similar level seen in 20103. Semen exports were valued at
$9.43 million in 2011 and are $5.63 million from January to October 2012 down 30% from the same
period last year4.
The top five markets for semen in 2012 have been China (65%), Brazil (11%), the U.S. (8%), Peru (3%)
and Mexico (3%) as compared to Brazil (26%), China (22%), US (16%), Mexico (9%) and Uruguay (5%) in
2011. Up until 2008 the U.S. was a major market for Canada with greater than 70% of total semen
export value. This has dropped in recent years with other markets developing.
In 2012, semen exports were dominated by Simmental with 60% of the total volume, followed by Angus
(21%), Charolais (8%), and Crossbreds (5%) with 13 other breeds representing 1% or less of total
volumes.
Table 3: Semen: Breeds Exported by Country of Destination
United States (16%)
Angus (71%)
Simmental (12%)
Brown Swiss (bf) 7%
Hereford (5%)
And 11 other breeds
2012
China (65%)
Brazil (11%)
United States (8%)
Simmental (90%)
Angus (98%)
Angus (59%)
Charolais (9%)
Simmental (2%)
Simmental (12%)
Angus (1%)
Gelbvieh (12%)
Shorthorn (7%)
And 8 other breeds
*Percentages do not add to 100% because of crossbreds/unknown breeds.
2011
Brazil (26%)
Angus (92%)
Hereford (5%)
Simmental (3%)
China (22%)
Simmental (88%)
Charolais (8%)
Angus (4%)
Mexico (9%)
Angus (81%)
Simmental (8%)
Hereford (4%)
And 7 other
breeds
Peru (3%)
Angus (13%)
Simmental (9%)
Uruguay (5%)
Angus (58%)
Hereford (40%)
Limousin (2%)
Mexico (3%)
Angus (48%)
Brown Swiss
(beef) 8%
Currently there are very few purebred cattle in China. In general, cattle produce lighter, slower growing
animals with longer production time and cost despite several years of genetic improvement through
breeding programs. The beef herd is dominated by a three-way cross between local cattle, western
Simmental, Charolais and Limousin breeds. There are five major introduced breeds including: the
Simmental, Shorthorn, Hereford, Charolais and Sindi Red. In terms of production advancements there
has been little improvement with high quality beef accounting for less than 5% of total production.
China hopes to improve agricultural output by improving genetics and general modernization of the
industry. However, grazing land is being pressured by growing urbanization and conversion to cash crop
3
4
Source: CFIA
Source: Statistics Canada
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production. Poor management of natural grassland by over-grazing and lack of investment has resulted
in deteriorated pastures on 58% of Inner Mongolia grasslands.
In Brazil, large operations are investing in improved pasture management, nutrition and cattle genetics.
However, smaller producers do not necessarily have the resources to make genetic investments.
Global trade of semen shows Canada as the second largest exporter, with 26% of total value in 2011
(including dairy semen). Canada is widely recognized in the dairy genetics market. The U.S. is the largest
exporter with 34%, while the Netherlands (10%) and the United Kingdom (6%) trail Canada. The U.S. is
also the largest importer of bovine semen with 10% of trade followed by Brazil (8.4%), the United
Kingdom (7.2%), Mexico (6%) and Argentina (4.8%).
Embryo exports reported by CETA for 2012 are unavailable at this time. CFIA data from January to
November at 563 units is down significantly from 2011. Statistics Canada data (including dairy) from
January to October 2012 is down 16% in volume and 6% in value.
The top five markets in 2012 have been the U.S. (21%), Finland (14%), Kazakhstan (11%), Netherlands
(9%) and Denmark (8%) as compared to Australia (34%), U.S. (24%), United Kingdom (10%), China (6%)
and Finland (14%) in 2011. Notably, Australia went from being the largest embryo export market in
2011 to not even registering any export volumes from January to November 2012.
In 2012, embryo exports have been dominated by Angus (47%) followed by Crossbred (39%), Simmental
(5%), Hereford (3%), and Speckle Park (2%). This is compared to Crossbred (51%), Angus (21%), Hereford
(10%), and Simmental (7%) in 2011.
Table 4: Embryos: Breeds Exported from Canada by 5 Country Destinations
2011
2012
Australia (34%)
United States (24%)
United Kingdom
(10%)
Angus (43%)
Limousin (1.5%)
China (6%)
Finland (5%)
Simmental (16%)
Angus (6%)
Hereford (2%)
Speckle Park (2%)
Limousin (1%)
Charolais (<1%)
Angus (39%)
Hereford (23%)
Shorthorn (19%)
Brown Swiss (bf) 11%
And 5 other breeds
Angus
Brown Swiss
(Beef)
United States (21%)
Finland (14%)
Kazakhstan (11%)
Netherlands (9%)
Crossbred
Angus
Angus
Denmark
(8%)
Angus
Angus (66%)
Simmental (14%)
Hereford (9%)
Speckle Park (6%)
Shorthorn (4%)
*Percentages do not add to 100% because of crossbreds/unknown breeds.
**Source: CFIA
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Genetics Marketing Programs
The CBBC 2013/14 marketing plan is built on the three year strategic framework described in the
Appendix. A significant portion of this plan is based on input from the breed associations and exporters
that make up the Council’s membership. This involved a fairly a lengthy process that included interviews
followed by an extensive review of requests for market development.
The overriding goal or long term result of this plan (and future plans under the three year strategic
framework), as described in the logic framework above, is to support the development of:
“A profitable, sustainable Canadian industry that results in the Canadian beef industry and cattle
being recognized as the most outstanding by Canadian and world customers”
Key market development/growth constraints and the role of CBBC
As part of the interview process, members provided information on their key internal and external
constraints (i.e. weaknesses and threats) to sustainable market growth and development of the
Canadian beef cattle genetics. As well, a number of strengths and associated opportunities were also
identified. The table below describes these identified strengths, weakness, opportunities and threats.
SWOT Analysis of Sector by CBBC Members
INTERNAL
EXTERNAL
Strengths
Superior genetics product
Weakness
Low capacity to supply
Opportunities
Enforcement of APA
Canada’s reputation in the
world
Costs of production
Focus on quality and
premium branding
More open economies
Lack of market
intelligence/qualified trade
leads
Lack of enforcement of APA
Weak link to CFIA
Weak long term sales
support
Cost structure limits market
segmentation/diversity
(cannot compete in less
developed markets)
Fragmented industry
Redundancies and overlap by
industry support
organizations (e.g. CBBC, CBI,
CGLA, Agribition, etc.)
Threats
Complex health
protocols/testing costs
Geographic/breed limits
Complex rules, regulations
for market access
Graft and corruption in some
export markets
Weakening beef demand
Highly competitive export
market
Subsidy programs in foreign
markets and amongst
competitors
Tariff and non-tariff trade
barriers
Economic Recession
Similarly, members were asked, as part of this same interview, to identify areas or roles they see CBBC
assuming in order to support and promote growth of their markets. Two priority services emerged:
1 Representing CBBC membership’s interests and concerns on provincial and federal government and
industry bodies including government agencies responsible for animal health, food safety,
competiveness (including research) and market access; and
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2
Provide assistance with gaining access to government grant programs
This market development plan responds to these comments by emphasizing the following roles of the
CBBC.
Application, Approval and Agreement- Market Development Support for CBBC members
One of the functions of the CBBC is to act as a conduit for Legacy Fund market development support to
the Purebred Breed Associations that represent Canada’s producers of purebred genetics as well as their
service providers (exporters, fair organizers, etc.). CBBC has represented its members, providing a “flowthrough” mechanism so that members may access market development funding support from the
CCMDC Legacy Funds.
This year marks the launch of some key improvements in how CBBC manages these funds and this
support. This process introduces more rigor and accountability into the application, approval and
implementation processes – seeking a more results-oriented approach to the management of the fund
and the activities that it supports.
Key features of this plan include:
Promotes results oriented, quality market development activities with greater, performance-based
reporting mechanisms...
A portion of CBBC’s market development plan involves requests for support from its member breed
associations and associate members. A new process has been introduced this year which demands that
applicants for market development support must pay closer attention and focus on the expected results
of their market development activities rather than just completing the activity. As these activities have
always been cost-shared between the member and the fund, there has always been some level of
assurance that the activity is in the best business interest of the member. New mechanisms including an
application form along with a grant agreement shall improve assurances of this. Both the application
form and grant agreement require activity results targets be estimated and specified for approval of the
application. Moreover, as part of the monitoring and evaluation processes, information on these results
must be reported in sufficient detail and with sufficient explanation (particularly if targets are not met)
in order to trigger the release of the grant support and any successive funding of other future market
development activities.
The application form also requires more substantive information about the planned activity including
the level of due diligence taken by the member regarding the potential market opportunity, the skills
and capacities of those that will take part or lead the activity, capacity to supply if there is a sales target
attached to the activity and the level of coordination/collaboration with other members and or
Canadian beef groups and organizations.
Flexible, agile and responsive to changing business environment, iterative...
The business environment under which our members operate is dynamic and change occurs regularly.
As such, a key feature of this plan, as requested by our members, is that it remains flexible to new and
important opportunities that may surface over the course of the year. As it is CBBC’s overall intent to
remain responsive to the changing market conditions of its members and to remain flexible so that the
market development support can adapt to emerging opportunities, a mid-year review of project
activities will be undertaken. At this time and in keeping with our results-based principles, we will review
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this market development plan with our members and evaluate and approve any well defended requests
for adjustments to their current market development activities.
Additionally, and as part of a results based approach, this mid-term review shall also be iterative in
nature, assessing the performance of the various activities undertaken during the first half of the year
and building a knowledge base of what works and what does not. This will inform future annual
planning, activity selection and implementation.
Based on a longer time horizon...
This plan is premised on a three year market development strategic framework. This offers a longer
time span to generate, evaluate and assess the results of the market development activities, thereby
increasing the opportunity for improved program planning and implementation.
Establishing indicators and setting benchmarks...
As this is the first year of the implementation of the three year market development strategic
framework with new indicators and targets, this will also be a year for establishing benchmarks and a
baseline. This is particularly true for indicators and targets associated with market growth activities. As
such, several of the indicators do not have specific targets assigned to them. The performance of
activities this year and the results that are achieved will be used to set in the next two years of the
strategic framework.
It should be noted that the strategy uses both leading and lagging indicators for both short term (e.g.
qualified leads) and medium term (e.g. sales) expected results outcomes. Moreover, medium term
results outcomes may not only be attributable to activities described in this work plan but may also be
the result of market development activities undertaken in the past. This emphasizes the importance of
setting annual benchmarks for both leading/lagging and short term/medium term indicators.
Focuses on priorities and encourages industry unity...
This plan focuses CBBC’s market development activities not only on market development but also
industry unity and health. The Canadian Beef Advantage (CBA) figures prominently in this plan as a
branding tool to be used internationally (but also at home) to promote greater unity and cohesion of the
industry as a whole. This is important to CBBC and to its members – without this kind of unity, growth
will be limited by the individual market development activities of the individual breed associations and
exporters. With improved consistency in messaging through the CBA, market development activities
will offer broader range of benefits for the industry as a whole without negatively impacting the
different organization(s) undertaking their individual market development activity.
A note on CBBC, its members and market development results…
The new process seeks a more results-oriented focus on market development activities managed by
CBBC (including CCMDC funds). The goal of this plan, as described above, is to promote and encourage a
profitable, sustainable industry that is recognized as outstanding by domestic and international
consumers. A key measure of success of market development activities managed/organized by CBBC
and its members is increased profits – primarily through increased sales revenues in both mature and
new markets and, to some extent, by reducing fixed and variable operating costs (market access, etc.).
The challenge is that the level of profitability is ultimately determined by the producers – not by the
breed associations that make up CBBC’s regular membership and that undertake the market
development activity. These activities are arm’s length away from the producer so the “locus of control”
on returns and profitability is removed from those that are undertaking market development. The
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Associations do not make decisions for the producers and it is up to the producer to respond to
opportunities presented to them. While sales figures and qualified leads are key indicators under this
plan, the distance from producer-level business decision-making must be noted.
Objectives & Key Priorities
To reiterate, the objective of this market development plan is to bring about sustainable growth of the
beef cattle purebred genetics sector. To achieve this objective, this plan focuses the work of the CBBC
on the three goals of the beef cattle industry mandated by the CCMDC. This plan also seeks to establish
and strengthen CBBC’s position as a representative and hub of information for Canada’s purebred beef
genetics sector.
To concentrate its efforts, the CBBC has identified six (6) markets of focus for its international market
development work. They are:






USA
Australia
Mexico
Kazakhstan
Russia
China
The export markets were identified by our members as priorities. These markets were ranked the
highest in terms of market potential and importance to their businesses. We believe that our members
are in the best position to make these assessments and set these priorities as they know which markets
offer the greatest potential for growth.
Moreover, the selection of these six (6) strategic markets serves two, complementary motivations:
1. To preserve or maintain current market share in mature or well developed markets (USA,
Mexico and Australia); and
2. To generate industry growth through entry and expansion into new and emerging markets (in
Kazakhstan, Russia and China).
Note that, while these are markets of focus for CBBC’s international market development activities,
other markets will also be supported under this plan. The following activities describe how CBBC will
seek to support these objectives in these priority markets over the course of fiscal year 2013/14 .
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Activity Description
Activities planned under this market development plan are summarized in the table below. Detailed descriptions for each activity follow this
table.
Summary of Activities and Funding Requirements
Activity
Number
Activity Name
Legacy Funds
Required
CBBC Counterpart
Goal #1: Build awareness for a Canadian beef identity/brand built on benefits defined by a strong and clear value proposition
Develop a CBBC Communication & Education Strategy and Action Plan
$20,000
$20,000
101
Continue to promote the proper use of CBA amongst CBBC members
$15,072
$15,072
102
103
104
Website Redevelopment
Promote breed registration
$10,000
$10,000
None - CBBC Core Funding
Goal #2: Achieve growth in traditional, existing, new and emerging markets for Canadian beef genetics products
Representation – Market Access and Competitiveness
$1,400
201
202
203
204
Annual market development activity planning
Implementing market development activities
Market intelligence training
$1,400
None – CBBC Core Funding
$356,610
$356,610
$1,400
$1,400
Goal #3: Maximize the total value realized by the Canadian beef and cattle genetics industry through optimization of genetics and live cattle values
Representation: Research and Development
None – CBBC Core Funding
301
302
303
304
305
Encourage breed improvement
Discourage product devaluation
After sales buyer support and training
Breed registration
GRAND TOTAL
$194,457
$194,457
None – CBBC Core Funding
$198,311
$198,311
Covered under Activity 104
$797,250
$797,250
NOTE:
1. The allocation of funds to Goal #1 – building awareness for a Canadian beef identity – do not accurately reflect the total contribution to
this objective. If the objectives under Activity 102 and Activity 202 are achieved, Activity 203 will also contribute to this awareness
raising, particularly amongst international buyers of purebred beef cattle genetics.
2. Fund Administration costs are included in the above figures.
3. International travel of CBBC staff/personnel is included under Activity 203.
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Activities - Series 100
Goal
Track
Strategy
Activity Name
Activity
Description
ACTIVITY 101
Goal #1: Build awareness for a Canadian beef identity/brand built on benefits defined by a strong and clear value proposition
Domestic Awareness/International Awareness/Protecting the CBA Brand
1A: Increase awareness and understanding throughout the entire Canadian beef value chain (and its relevant organizations) of the
importance of purebred beef cattle genetics to Canada’s international and domestic beef cattle markets
1B: Develop awareness and understanding, in priority export markets, of beef cattle purebred genetics industry through support and
promotion of the CBA brand
1C: Protect the reputation of the Canadian beef purebred genetics brand and, by extension, the CBA
Develop a CBBC Communication &
Funding
Event & Promo Material Costs –
Timing
Apr 2013 – Mar 2014
Education Strategy and Action Plan
Requirements
Legacy Fund/Counterpart: $40,000
Prepare and implement a comprehensive internal and external communication strategy and plans that focuses on the following objectives:
1. Raise domestic awareness about CBBC and the value of Canadian purebred genetics to the Canadian beef cattle value chain including
consumers
2. Raise international awareness about CBBC and the quality and value of Canadian purebred genetics
3. Encourage more cohesive and consistent messaging - particularly internationally – about the Canadian Beef Advantage
4. More firmly establish the CBBC as a hub for information exchange and education on Canada’s purebred genetics industry
External Communication: The plan will centre on three external communication tasks:
1. Design and develop stock CBBC/CBA publications and promotional material that provide information regarding the Canadian
purebred beef cattle genetics value proposition, including the Canadian Beef Advantage. The material will be designed for use by
both CBBC members and staff at trade events including trade fairs, breed congresses and other breed-specific events, on trade
missions and any other appropriate promotional opportunities.
2. Identify and organize opportunities for collaboration and coordination with other beef cattle industry groups and associations with
similar mandates and similar activities to raise awareness of the CBA (e.g. Canada Beef Inc.). Through joint planning exercises,
organized by CBBC, effort will be taken to coordinate these activities to minimize redundancy and/or overlap.
3. Review and spearhead an industry-wide response system to industry crisis (e.g. E. coli outbreak, BSE, etc.) to minimize
misinformation and ensure a clear, consistent and transparent response that is delivered efficiently and confidently to the market.
4. In cooperation with the Canadian Simmental Association, organize and implement an International Beef Innovation Symposium. This
symposium would not focus on any one breed but rather review and explore the current research and innovation around beef
development in general.
5. CBBC will organize a public forum as part of the CBBC AGM, inviting other members of the beef cattle sector including cow-calf
producers to attend information sessions, seminars, presentations and exhibitions of beef cattle purebred genetics. Breed experts
and others from CBBC membership will be invited to present and/or exhibit.
Internal Communication: Similarly, the plan will also map out a number of internal communication tasks designed to promote greater industry
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ACTIVITY 101
cohesiveness, synergy and information sharing. These include:
1. Promote and encourage coordinated communication of market development/promotion activities by and amongst its regular and
associate members, both domestically and internationally through pre and post mission meetings.
2. Enforce stricter reporting requirements on its members that have undertaken CBBC/CCMDC-funded market development activity in
order to share valuable but NON-PROPRIETARY market intelligence as well as breed improvement information common to all breeds
(depending on the activity).
3. Promote the Council’s value proposition through the design, development and distribution of a weekly update on the Council’s
activities to members.
4. Design and develop a monthly breakfast information seminar series for members for communication, networking and education
purposes. These breakfast meetings will vary in terms of content and may include meetings described in other sections of this plan.
Key
Performance
Targets
5
Key features of the communication plan:
 Long term strategy coupled with a shorter term plan
 Action plan and budget
Leading Indicator(s)
CBBC (industry-wide) communication strategy and plan developed
Lagging Indicator(s)
5
5% increase in inquiries to CBBC on purebred beef genetics
NOTE: Cumulative annual total covering all activities
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Goal
Track
Strategy
Activity
Name
Activity
Description
ACTIVITY 102
Goal #1: Build awareness for a Canadian beef identity/brand built on benefits defined by a strong and clear value proposition
Domestic/International Awareness/ Protecting the CBA brand
1A: Increase awareness and understanding throughout the entire Canadian beef value chain (and its relevant organizations) of the importance
of purebred beef cattle genetics to Canada’s international and domestic beef cattle markets
1B: Develop awareness and understanding, in priority export markets, of beef cattle purebred genetics industry through support and
promotion of the CBA brand
1C: Protect the reputation of the Canadian beef purebred genetics brand and, by extension, the CBA
Ongoing promotion of the proper use of
Funding
Meeting & Promo Material –
Timing
May, Sep 2013, Jan 2014
CBA amongst CBBC members
Requirements
Legacy Fund/Counterpart: $30,144
The Canadian Beef Advantage brand is an important unifying breeds and production regions under one common banner. This is important to
preserving and protecting the reputational value of Canada’s purebred beef genetics as well as reducing market confusion that may be caused
by using provincial and/or breed-specific branding information and promotional material.
As such and in addition to the activities defined in the planned Communication Strategy and Plan, the CBBC will organize and host two to three
(2-3) member meetings/training sessions to discuss the use of the CBA in their respective market development activities. The objective is to
ensure correct and consistent understanding and use of the CBA brand while undertaking market development activities including the
development of promotional material and undertaking trade or sales missions. The correct use of the CBA brand will be a highly effective
means of encouraging market growth and development – particularly in international markets where the objective is to promoting Canada as a
source of the “Canadian Beef” brand purebred genetics (regardless of the breed).
Key
Performance
Targets
6
7
This activity will engage marketing experts from CCA to discuss the pros and cons of supporting the CBA brand and may be incorporated into
the monthly breakfast series referred to under Activity 101.
6
Fifty (50) members of beef value chain aware of role of purebred genetics in the value chain
7
Fifty (50) foreign buyers newly aware of CBA brand and its relationship to Canadian purebred genetics
NOTE: Cumulative annual total covering all activities
NOTE: Cumulative annual total covering all activities
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Goal
Track
Strategy
Activity
Name
Activity
Description
Key
Performance
Targets
ACTIVITY 103
Goal #1: Build awareness for a Canadian beef identity/brand built on benefits defined by a strong and clear value proposition
Domestic Awareness/International Awareness/Protecting the CBA Brand
1A: Increase awareness and understanding throughout the entire Canadian beef value chain (and its relevant organizations) of the importance
of purebred beef cattle genetics to Canada’s international and domestic beef cattle markets
1B: Develop awareness and understanding, in priority export markets, of beef cattle purebred genetics industry through support and
promotion of the CBA brand
1C: Protect the reputation of the Canadian beef purebred genetics brand and, by extension, the CBA
Funding
Website Development Costs - Legacy
Website redevelopment
Timing
May 2013
Requirements
Fund/Counterpart: $20,000
The CBBC website requires rehabilitation and/or restructuring to render it a more effective communication tool for the Council. There are a
number of features that can be incorporated including a “Members’ Only” section, where activity reports from market development work can
be posted. As well, the website is an important vehicle for establishing the CBBC as a hub for Canadian purebred genetics information (that, in
turn, would contribute to more consistent messaging by and for the industry). The website will be an integral tool for implementing the
communication strategy described in Activity 101 above.
Leading Indicator(s)
Fifty (50) members of the beef value chain aware of role of purebred genetics in the value chain
Fifty (5) foreign buyers aware of CBA brand and its relationship to Canadian purebred genetics
Lagging Indicator(s)
5% increase inquiries to CBBC on purebred beef genetics
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Goal
Track
Strategy
Activity Name
Activity
Description
ACTIVITY 104
Goal #1: Build awareness for a Canadian beef identity/brand built on benefits defined by a strong and clear value proposition
Protecting the CBA brand
1C: Protect the reputation of the Canadian beef purebred genetics brand and, by extension, the CBA
Funding
Promo Material –
Promote breed registration
Timing
Apr 2013 – Mar 2014
Requirements
CBBC Core Funding
A key challenge affecting the purebred genetics sector is maintaining the integrity of the individual breeds, and protecting the Canadian Beef
Advantage brand, through correct registration of purebred breeding stock transfers. This procedure is fundamental to ensuring that pure
breeding stock is correctly identified and the pedigree is acknowledged and maintained thereby ensuring correct within-breed and cross
breed production. Registration is the principal mechanism for ensuring this. Breed associations promote registration to their breeders but
more work is needed to ensure greater compliance – both domestically and internationally.
To promote registration, CBBC will develop and deliver registration information and promotional material, including information on the
importance of registering to its members. Delivery mechanisms include the CBBC website and a hard copy pamphlet. In addition, as part of a
larger breakfast seminar series, a seminar on registration processes will be planned and implemented. This seminar will engage a breed
registration expert to make a short presentation and answer any questions about the registration process and challenges. In conjunction with
this activity, CBBC will investigate current challenges to registration encountered by breeders. This information will serve to inform the
content of the planned information pamphlets and website information.
Key
Performance
Targets
Information may also be disseminated through other internal communication channels as described in the communication plan (see Activity
101 above).
3% increase in registration of eligible/applicable breeding stock
100% registration of transfers of purebred beef breeding stock sold
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Activities - Series 200
Goal
Track
Strategy
Activity Name
Activity
Description
ACTIVITY 201
Goal #2: Achieve growth in traditional, existing, new and emerging markets for Canadian beef genetics products
Market Access
2A: Improve market access for Canadian beef cattle genetics in foreign markets
Representation, market access and
Funding
Domestic Travel –
Timing
Apr 2013 to Mar 2014
competitiveness
Requirements
Legacy Fund/Counterpart: $2,800
Free and unfettered market access both domestically and in internationally markets will ensure a healthy, competitive Canadian beef genetics
industry. Currently, there are a range of issues that remain in place that hinder the industry’s ability to effectively compete. It is dynamic
market environment and these issues change quickly. Many of these market access issues have their origin in the systems, processes and
bureaucracies. To mitigate this, for the fiscal year 2013/2014, CBBC would like to take a stronger, focused role in representing the interests of
the Canadian beef genetics industry in order to resolve some of these issues. CBBC is represented on twenty different committees,
organizations and groups – some of which deal directly with market access issues. Examples include the BCMAC (Beef and Cattle Market
Advisory Committee), Interbeef and BCTAG (Beef and Cattle Trade Advisory Group).
CBBC’s objective under this activity is to leverage this representation and bring more focus in order to improve CBBC’s opportunities to
advocate for positive change.
Key
Performance
Targets
This activity will cover a range of tasks that include:
1. Develop a simple survey that allows members to rank priority issues of members
2. Rank and establish top three issues to be addressed for 2013/2014
3. Establish a unified CBBC position on each of these issues
4. Evaluate CBBC’s membership within different groups
5. Develop an action plan
Leading Indicator(s)
3 top priorities set
Lagging Indicator(s)
2-3 market access issues resolved
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Goal
Track
Strategy
Activity Name
Activity
Description
Key
Performance
Targets
ACTIVITY 202
Goal #2: Achieve growth in traditional, existing, new and emerging markets for Canadian beef genetics products
Planning – Market Development
2B: Build a cohesive, unified purebred genetics industry (focusing on breeders) that leverages the strengths of all its members to capture a
greater market share both domestically and internationally
Annual market development activity
Funding
Meeting Costs –
Oct 2013 to Jan
Timing
planning
Requirements
CBBC Core Funding
2014
As part of next year’s market development planning (i.e. for the 2014/2015 plan), a number of tasks are planned under this activity to ensure
that the plan strategically maximizes beef cattle industry resources. In order to reduce redundancies and overlap, it is the intention of CBBC
to incorporate other beef cattle agencies, organization and groups into its planning processes. Key partners include CBI and the CLGA. This
will include a set of meetings, beginning in October, to meet with all relevant beef cattle associations, the CBBC membership (including
association members), in an effort to synchronize market development planning. It is CBBC’s hope that, by taking a leadership role in this
regard, broader benefits to the entire industry will be accrued from existing market development support and resources. Tasks under this
activity include:
1. Investigate planning cycles of all Canadian beef cattle organizations & groups including Canadian agriculture/beef fairs and
exhibitions
2. Spearhead annual planning meetings with above groups to coordinate activity planning
3. Undertake a membership-wide planning exercise to promote appropriate internal collaboration and cooperation on market
development activities supported by Legacy Funds
4. Develop annual international market development plans (Legacy Fund) utilizing this framework as a basis for planning.
5. Develop a domestic market development plan utilizing this framework as a basis for planning
Leading Indicator(s)
8
Fifty (50) members of beef value chain aware of role of purebred genetics in the value chain
9
Fifty (50) foreign buyers newly aware of CBA brand and its relationship to Canadian purebred genetics
10
Set Baseline - Qualified leads - Baseline
Set Baseline - % qualified leads convert to sales
Set Baseline - Time qualified leads take to convert to sales
Lagging Indicator(s)
Set Baseline - Change in average per unit value
5% increase in volume of exported purebred Canadian beef cattle breeding stock (all types)
8
NOTE: Cumulative annual total covering all activities
NOTE: Cumulative annual total covering all activities
10
Qualified Leads: A clear match between the product needs of a buyer who has the ability to pay for these products and the supply capabilities of the breed association and/or
exporter
9
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Goal
Track
Strategy
Activity Name
Activity
Description
ACTIVITY 203
Goal #2: Achieve growth in traditional, existing, new and emerging markets for Canadian beef genetics products
Implementation – Market Development
2C: Support breeders and exporters undertake market development work to achieve domestic and international market growth of the
Canadian beef cattle genetics industry
Implementing market development
Funding
International Travel:
Timing
Apr 2013 – Mar 2014
activities
Requirements
Legacy Fund/Counterpart: $713,220
As in previous years, CBBC has solicited for and received funding from the CCMDC to support market development activities of the Council
and its members. Solicitation is undertaken through this market development plan. Explained above, a different process has been followed
this year which will encourage greater accountability for both the funds and the activities these support. A key focus is on achieving
substantive results that support a profitable and sustainable industry.
This year’s plan covers a range of activities – similar to last year – including outbound missions to key priority markets, inbound missions
including incoming buyers programs for our associate members and trade fair participation. CBBC’s members will undertake a range of
market development activities. CBBC`s role will be ensure adequate coordination and leveraging of activities to ensure that the industry, as a
whole, benefits without negatively influencing individual breed/exporter competitive advantages. Many of the activities described in the
summary table below may serve multiple goals of this plan- the overriding objective, however, is to promote long term sustainable growth of
the Canadian purebred genetics sector.
As well, there are a range of innovative market development activities to be undertaken with Legacy Fund support. These include:
1.
2.
Country Ambassador Program by Northlands/Farmfair International (Associate Member)
Youth programs by the Angus Association (Regular Member)
The table below provides a breakdown of market development activities and funding required according to the six (6) different priority
markets. Additional funding is requested for market development activities in non-priority markets. Support market development in nonpriority countries is important for two reasons:
1. Increases diversity of markets that market development activities are undertaken, reducing the industry’s exposure to potential
shocks that might occur in these six priority countries.
2. Encourages market growth and development over the longer term by take steps to develop non-priority markets now that could
become priority markets in the future.
Funding figures are rolled up into a total for each market. A complete breakdown of the requests we have received from members is available
upon request.
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Key
Performance
Targets
ACTIVITY 203
11
Market
Funding Requested
Planned Activities
Results Targets
New
Kazakhstan
$80,467
6 qualified leads, $5m+ in sales
Russia
$54,792
300 head, $3M, 3 qualified leads
China
$24,436
5 qualified leads, 60,000 straws of semen
Inbound/Outbound Market
Mature
Development Missions, Trade Fair
Australia
$11,013
Participation
USA
$9,293
$200K
Mexico
$45,362
$270K
Mix
Various
$105,247
75 embryos, $1.5M in sales
Budgeting Assumptions
Airfares:
Russia/Kazakhstan/China $2500
USA/Mexico $1000
Australia/New Zealand - $3000
Europe/South America - $1500
Per Diem - Accommodation/Meals:
Canada $200 per day
International including US $400 per day
Leading Indicator(s)
12
Fifty (50) members of beef value chain aware of role of purebred genetics in the value chain
13
Fifty (50) foreign buyers newly aware of CBA brand and its relationship to Canadian purebred genetics
14
Set Baseline - Qualified leads - Baseline
Set Baseline - % qualified leads convert to sales
Set Baseline - Time qualified leads take to convert to sales
Lagging Indicator(s)
Set Baseline - Change in average per unit value
5% increase in volume of exported purebred Canadian beef cattle breeding stock (all types)
11
NOTE: These are not complete results targets but are representative of those targets submitted by some, but not all, members requesting funding support. Where
appropriate, results targets will be set for all market development initiatives as part of a grant agreement to be signed with the member.
12
NOTE: Cumulative annual total covering all activities
13
NOTE: Cumulative annual total covering all activities
14
Qualified Leads: A clear match between the product needs of a buyer who has the ability to pay for these products and the supply capabilities of the breed association and/or
exporter
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Goal
Track
Strategy
Activity Name
Activity
Description
Key
Performance
Targets
ACTIVITY 204
Goal #2: Achieve growth in traditional, existing, new and emerging markets for Canadian beef genetics products
Implementation – Market Development
2C: Support breeders and exporters undertake market development work to achieve domestic and international market growth of the
Canadian beef cattle genetics industry
Funding
Event & Domestic Travel Costs Market intelligence training
Timing
July 2013
Requirements
Legacy Fund/Counterpart: $2,800
Gathering accurate market intelligence is critical to the development of any market. Market intelligence is qualified market information
tailored and specific to the particular business or sector of interest. It provides a deeper level of information upon which a business may make
informed business decisions. Gathering market intelligence is part of required due diligence when building and developing new markets. It
requires skills in research, data collection, analysis and communications. Gathering accurate market intelligence is particularly important to
the CBBC and its members. Many of the market development activities undertaken under this plan involve members that are representatives
from the different breed associations. They are not necessarily the end-user of this intelligence. As such, their ability to gather market
intelligence determines not only their success at expanding their markets as a breeder but also the success of other breeders that make up
their association.
A one-day seminar will be designed, developed and implemented. This seminar will cover the basics in intelligence gathering – from internet
searches to gathering data in the market (cold calls, local information on buyers, etc.) to analysis and communication upon return. This oneday seminar will be offered to all members and office staff at CBBC and will be designed to build capacity to collect and analyze market
intelligence. The seminar will engage a market intelligence firm or expert (a potential resources is Industry Canada’s Trade Commissioner
Service) and solicit the support and involvement of Agribition, Farmfair International and the Canadian Bull Congress.
Increased quality and distribution of market intelligence info for CBBC membership
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Activities - Series 300
Goal
Track
Strategy
Activity Name
Activity
Description
ACTIVITY 301
Goal #3: Maximize the total value realized by the Canadian beef and cattle genetics industry through optimization of genetics and live
cattle values
Product
3A: Promote the continuous development of the value-added proposition of the Canadian beef cattle genetic product
Representation, breed research and
Funding
Meeting Costs –
Timing Apr 2013 – Mar 2014
development
Requirements
CBBC Core Funding
Research is critical to continued product improvements in the Canadian purebred genetics sector. Research not only seeks to eradicate
diseases, it is also important to ensuring Canada remains competitive with its purebred genetics products. Research is ongoing in Canada and
around the world. It is important, though, that the research in genetics in Canada is guided and linked to industry needs. Academic research
without industry involvement, while having some intrinsic value, may lead to limits in its application for industry.
CBBC is best positioned to guide research and development related to breeding stock and purebred genetics. A cursory survey of members on
research priorities undertaken as part of the development of this market development plan indicated the following top four priorities for
research and development:
1. Genomics – identifying genetic markers for particular desirable traits (taste, tenderness, etc.)
2. Quality management and quality control
3. Disease resistance
4. Productivity of breed(s)
Key
Performance
Targets
Utilizing its membership and/or networks with different research bodies including the BCRC, the International Society of Animal Genetics and
the Beef Improvement Federation, the Council aims to advocate for and promote research in priorities as set by its members. The approach,
methods and tasks are similar to those that will be undertaken under Activity 201 “Representation – Market Access” and include:
1. Develop a simple survey that allows members to rank priority research areas
2. Rank and establish top three research areas to be advocated for in 2013/2014
3. Develop a communication and advocacy action plan (linked to Activity 101 – Develop a CBBC Communication & Education Strategy
and Action Plan)that calls for CBBC to spearhead and aggressively champion this research and development agenda including support
for continuous genetic improvements
Set Baseline – Performance and the success rate of product
Set Baseline – Predictability, product has consistent results regardless of location
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Goal
Track
Strategy
Activity Name
Activity
Description
ACTIVITY 302
Goal #3: Maximize the total value realized by the Canadian beef and cattle genetics industry through optimization of genetics and live
cattle values
Product
3A: Promote the continuous development of the value-added proposition of the Canadian beef cattle genetic product
Funding
International Travel –
Encourage breed improvement
Timing
Apr 2013 to Mar 2014
Requirements
Legacy Funds: $198,311
Annual international breed association congresses are important and valuable events to the breed associations. Attendance at these
congresses serves three main objectives:
1. Updates breeders on the latest information on breed improvements, advancements and ongoing research
2. Discuss and resolve current and ongoing challenges and issues covering a range of topics. These may include challenges related to
market access, breed management, etc.
3. Lastly, congresses offer an opportunity to conduct business. Sales often occur at these events
Based on the above, the benefits to CBBC’s member associations accrue from attending these congresses are numerous – both in the short
term (sales and/or qualified leads) and the longer term (product enhancements, market constraints, etc.). As such, attendance at these
congresses serves an important market development function.
Key
Performance
Targets
With approval of this plan, CBBC will provide support to breed associations seeking assistance to attend their respective breed congresses.
Stricter controls will be placed on who attend as well stringent reporting requirements will be put into place to ensure that the whole Breed
Association (and, if relevant, other members of CBBC) derives benefits from the attendance of their representative.
Set Baseline – Performance and the success rate of product
Set Baseline – Predictability, product has consistent results regardless of location
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Goal
Track
Strategy
Activity Name
Activity
Description
ACTIVITY 303
Goal #3: Maximize the total value realized by the Canadian beef and cattle genetics industry through optimization of genetics and live
cattle values
Price
3B: Promote and advocate for the preservation of the value/price of Canadian purebred genetic products is maintained or increases in
international markets
Funding
Discourage product devaluation
Meeting Costs - CBBC Core Funding
Timing
Sep 2013
Requirements
Preserving the price value of Canada’s breed stock can be a tricky endeavor. It is critical, however, that preserving the value of the superior
breeding stock is important to market success of the industry. Under pricing or incorrect pricing of these high quality genetic products may
offer short term gains to the breeder and/or exporter but may lead to long term deterioration of the value of Canada’s breeding stock –
which is recognized as one of the more superior “brands” in the world.
CBBC will organize and plan a short half-day seminar on product devaluation practices in international markets along with mechanisms,
strategies that can be used to reduce these practices. An expert from Industry Canada and/or Agriculture and Agri-Food Canada will be
engaged to deliver this seminar.
Key
Performance
Targets
Please note, this activity is not/not about setting prices, pricing strategies or gathering pricing information, but rather about generic strategies
on curbing devaluation and devaluation practices.
Establish Baseline - Average per unit value of breeding stock (bulls, embryos, semen) (domestic and international)
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Goal
Track
Strategy
Activity Name
Activity
Description
Key
Performance
Targets
Goal
Track
Strategy
Activity Name
Activity
Description
Key
Performance
Targets
ACTIVITY 304
Goal #3: Maximize the total value realized by the Canadian beef and cattle genetics industry through optimization of genetics and live
cattle values
Willingness to Pay - Reputation
3C: Preserve and protect the reputation of Canadian beef as a safe, healthy, nutritious protein product
Funding
International Travel –
After sales buyer support and training
Timing Apr 2013 to Mar 2014
Requirements
Legacy Funds: $135,525
The preservation of the reputation of Canada’s purebred beef cattle genetics rests on the correct expression of the breed’s genotype. Each
breed has different requirements in order of the full genotypic features and characteristics are expressed. This may require a modification of
the current practices and processes used by international buyers of Canadian breeding stock, particularly those from emerging or developing
economies. It is vital, therefore, to the preservation of the reputation (and related “perceived value”) of Canadian beef cattle genetics that
buyers are trained on the proper care and maintenance of breeding stock sold to them.
Several of CBBC members will move forward with their respective training programs this year. These programs include Semex’s Beef Solutions
initiative in Russia and Kazakhstan, Alta Export’s training on embryo transfers and animal husbandry and extension programs and Northland’s
(Farmfair International) extension program (an adjunct to the Fair) to be conducted in cooperation with Lakeland College for Russian,
Ukrainian and Kazakhstan breeders/producers attending the show.
Set Baseline - Number of persons trained in proper care and maintenance of Canadian beef cattle breeding stock
ACTIVITY 305
Goal #3: Maximize the total value realized by the Canadian beef and cattle genetics industry through optimization of genetics and live
cattle values
Willingness to Pay - Reputation
3C: Preserve and protect the reputation of Canadian beef as a safe, healthy, nutritious protein product
Funding
Promote breed registration
See Activity 104
Timing
See Activity 104
Requirements
See description, Activity 104.
Pedigree - 5% increase in breeding stock registrations (per APA)
CCMDC Marketing Plan – 2013/14
79
Canadian Beef Breeds Council Marketing Strategy
Canadian Cattlemen Market Development Council
Reporting, Monitoring and Evaluation
One of CBBC’s roles is to manage, monitor and evaluate the use of Legacy Funds that CBBC and its
members receive. As such and in keeping with our results-based management approach to market
development work this year, a simple monitoring and evaluation system will be established to track the
market development activities of both the CBBC organization as well as its members as described in this
plan. Tracking will focus on the Key Performance Indicators (KPIs) described in both the three year
strategic framework and this work plan. For many of these KPIs, targets have been set for this year. For
other KPIs, a baseline or benchmark shall be set using this year’s results data.
While the KPIs offer a measure of accountability, their more important utility is as a monitoring and
learning tool for assessing activity performance (or non-performance). Using a set baseline and/or set
targets, a feedback loop will be established to evaluate activity performance in relation to these targets
(and their related goals).
To collect the required data, each member that receives Legacy funding will be required to submit an
activity report with their expense claim. This reporting requirement will be stipulated in the grant
agreement between CBBC and the member. These activity reports must contain information about the
results achieved under the activity.
A sample outline of this report will include the following sections:
1 Activity Type
2 Funding Amounts
3 Results achieved
4 Explanation of Variance from expected
5 Follow-up required
6 Proposed follow-up plan and reporting
We will focus on two main elements of this report; the analysis of the results achieved and, if there was
variance from the targeted, an explanation of this variance, as well as the follow-up plans of the Breed
Association and/or exporter. The quality of the information contained in these reports will be a key
criterion for release of grant monies and/or future support.
It is important to note that it is not necessary for the member to meet their expected target in order to
receive their funding support, what is important is that they offer some analysis as to why targets were
either met, not met or exceeded. This will be valuable information, used to inform future planning of
market development activities by the Council.
CCMDC Marketing Plan – 2013/14
80
Canadian Beef Breeds Council Marketing Strategy
Canadian Cattlemen Market Development Council
CBBC Operating Budget
Budget Summary - CBBC Market Development Plan 2013/2014
Cost Shared Activities
Goal #1
Activity 101
Activity 102
Activity 103
Activity 104
Goal #2
Activity 201
Activity 202
Activity 203
Activity 204
Goal #3
Activity 301
Activity 302
Activity 302
Activity 301
Activity 305
TOTAL
Split
CCMDC Marketing Plan – 2013/14
Legacy Fund
CBBC & Members
20,000
15,072
10,000
0
20,000
15,072
10,000
0
1,400
0
356,610
1,400
1,400
0
356,610
1,400
0
194,457
0
198,311
0
0
194,457
0
198,311
0
797,250
50%
797,250
50%
81
Canadian Beef Breeds Council Marketing Strategy
Canadian Cattlemen Market Development Council
Alberta Based Supplementary Marketing Initiative
The Alberta portion of the Canadian Beef and Cattle Market Development Fund, known as the Alberta
International Beef Marketing Development Fund (AIBMDF), provides an opportunity for applicants
beyond the marketing organizations to receive funding. Applications are invited from eligible Alberta
companies or organizations that propose an innovative marketing initiative that offers the potential to
maintain or increase exports of Alberta beef and cattle genetic products. The application review process
involves an external review committee, where required, to assist the CCMDC in their decision-making
process. The intent of the review committee is to provide recommendations to the CCMDC as to which
projects best meet the objectives and priorities of the Council and are most likely to contribute to the
enhancement of the Canadian cattle and beef cattle industry.
Background information on the fund, eligibility criteria, and the CCMDC's identified priorities are
available on the CCA website at http://www.cattle.ca/what-is-aibmdf/. Standardized application and
final reporting forms have also been developed to ensure that information required is provided, and
that there is consistency across all projects and initiatives when reporting results and achievements.
The table below includes projected AIBMDF approved funding for the period April 1, 2013 – March 31,
2014 for international beef marketing programs.
Alberta International Beef Marketing Development Fund (AIBMDF) approved budget
Latin America market development
Japan market development
Hong Kong market development
China market development
Korea market development
S.E. Asia market development
Middle East/Europe market development
Total
CCMDC Marketing Plan – 2013/14
2013/ 14
507,000
552,000
142,500
244,500
135,750
122,250
200,250
1,904,250
82
Alberta Supplementary Initiatives
Canadian Cattlemen Market Development Council
Legacy Fund Budget 2013/14
Projected Revenues: Canada Beef Inc and Canadian Beef Breeds Council
April 2013 - March 2014
Check-off Funds
Canada Beef Inc
4,504,915
CBBC
-
TOTAL
4,504,915
-
797,250
797,250
5,706,166
1,904,250
7,610,416
797,250
797,250
5,706,166
797,250
1,904,250
8,407,666
36,000
12,151,331
1,594,500
36,000
13,745,831
Membership Fees/matched funding
Development Funds
CCMDC- International markets
CCMDC - Beef Cattle Genetics
AIBMDF
Total Development funds
Other Revenue
TOTAL PROJECTED REVENUES
-
-
Summary of Funding by Source
Producer/Members/Other
5,338,165
38.8%
Government
8,407,666
61.2%
13,745,831 100.0%
CCMDC Marketing Plan – 2013/14
83
Legacy Fund Budget
Canadian Cattlemen Market Development Council
Projected Expenditures: Canada Beef Inc and Canadian Beef Breeds Council
April 2013 to March 2014 - includes Market Development and Administration
CCMDC
Federal
Market Development Canada and Int'l
Global
U.S.
Japan
South Korea
SE Asia
China /Hong Kong
Latin America
Middle East/Europe
Opportunity markets
Canada
Genetics Programs
Total projected expenditures
Total projected revenues
Projected surplus/deficit mkt dev't
CCMDC Administration
Total Legacy Fund Budget
CCMDC Marketing Plan – 2013/14
CCMDC
Alberta
AIBMDF
Industry
Total
1,202,771
721,663
0
441,913
265,148
0
167,493
100,496
552,000
89,713
53,828
135,750
67,978
40,787
122,250
236,921
142,152
387,000
163,656
98,194
507,000
54,177
32,506
200,250
240,265
144,159
0
901,467
540,880
0
498,281
298,969
0
4,064,635 2,438,781 1,904,250
255,358
256,283
95,644
128,141
2,484,892
797,250
5,338,165
4,064,635 2,438,781 1,904,250
4,064,635 2,438,781 1,904,250
0
0
0
5,338,165 13,745,831
5,338,165 13,745,831
0
0
260,644
156,386
0
4,325,279 2,595,167 1,904,250
641,478
235,687
273,330
93,097
77,005
0
2,565,912
942,748
1,093,319
372,388
308,019
1,021,431
1,025,133
382,577
512,565
3,927,239
1,594,500
13,745,831
417,030
0 8,824,696
84
Legacy Fund Budget
Canadian Cattlemen Market Development Council
Legacy Fund Budget
2013/14
a
2012/13
Budget
b
Budget
2011/12
c
Actual
2010/11
c
Actual
2009/10
c
2008/09
c
2007/08
c
Actual
Actual
Actual
Revenue
Legacy Fund
Marketing - Federal
4,064,635
2,542,892
3,023,727
8,209,723
9,458,707
8,084,186
4,845,009
Marketing - Alberta
Admin - Federal
Admin - Alberta
Alberta only marketing
Special projects - Federal
Special projects - Alberta
Subtotal Federal
Subtotal Alberta
2,438,781
260,644
156,386
1,904,250
0
0
4,325,279
4,499,417
1,525,734
212,906
127,744
2,250,000
0
0
2,755,798
3,903,478
1,621,303
255,322
153,193
1,475,695
0
0
3,279,049
3,250,191
3,611,388
332,684
199,610
144,418
774
464
8,543,180
3,955,880
3,724,919
414,348
248,609
0
162,644
97,586
10,035,699
4,071,115
2,803,481
375,037
225,022
0
153,871
92,323
8,613,094
3,120,826
1,953,755
172,249
103,350
0
0
0
5,017,258
2,057,105
Total Legacy Fund*
8,824,696
6,659,276
6,529,240
12,499,060
14,106,814
11,733,920
7,074,363
Legacy Fund
Administration
Special Projects-InfoXchange
Commercial Beef
U.S.
International
Live & Genetics
Alberta only marketing
Subtotal Federal
Subtotal Alberta
417,030
0
0
707,061
4,999,105
797,250
1,904,250
4,325,279
4,499,417
340,650
0
0
276,750
3,142,126
649,750
2,250,000
2,755,798
3,903,479
408,515
0
321,555
690,366
2,840,842
792,267
1,475,695
3,279,049
3,250,191
532,294
1,238
2,190,743
1,668,015
6,122,963
1,839,388
144,418
8,543,179
3,955,880
662,957
260,230
3,250,508
2,397,298
5,387,877
2,147,944
0
10,035,699
4,071,115
600,059
246,194
2,893,335
2,548,043
3,496,836
1,949,453
0
8,613,094
3,120,826
275,599
0
1,588,750
1,817,823
2,392,191
1,000,000
0
5,017,258
2,057,105
Total Legacy Fund*
8,824,696
6,659,276
6,529,240
12,499,059
14,106,814
11,733,920
7,074,363
Expenses
a
b
c
April 1, 2013 - March 30, 2014
9-months July1, 2012 - March 30, 2013; includes additional $49,750 funding to CBBC for Organization Review
July 1 - June 30
Legacy Fund balance
June 30/12 balance
2012/13 budget (9-month)
2013/14 budget (12-month)
March 31/14 balance
CCMDC Marketing Plan – 2013/14
Total legacy
Canada
Alberta
$24,868,905
$6,659,276
$8,824,696
$9,456,155
$2,755,798
$4,325,279
$15,412,750
$3,903,478
$4,499,417
$9,384,933
$2,375,078
$7,009,854
85
Legacy Fund Budget
Canadian Cattlemen Market Development Council
Appendix
Canada Beef Inc. three-year strategic plan and performance measures framework
3 Year Strategic Plan
Vision
Mission
“A Dynamic Canadian Beef Advantage Delivering Recognized Value"
“Innovative, Collaborative & Sustainable Canadian Beef Solutions”
'
Brand & Reputation
People & Knowledge
Risk & Reward
Innovation & Collaboration
(i) Seek (ii) Adopt (iii) Integrate (iv) Deploy
(v) Partner with passion & purpose
(i)
Operational Excellence
Risk management (ii) Program effectiveness & efficiency
(iii) Fiscal transparency (iv) Measured accountability
Stakeholder Connectivity
(i) Continually define & openly share “the Canadian Beef story”
(ii) Strategically align internal/external messaging to showcase value
(i)
•
•
•
•
•
Culture & Leadership
Discover, enable & reinforce a mature & evolving culture of accountability, leadership & partnership
(ii) Talent development/succession
Communicate the benefit of the Canadian Beef
Advantage
Marketing efforts deliver a heightened
consumer commitment to Canadian beef.
Marketing activity results in differentiation
across a broad menu of Canadian beef offerings,
generating measureable value.
Marketing efforts enhance demand/ROI for beef
products.
Leverage the benefits of Canadian cattle genetics
to strengthen the Canadian beef brand and
reputation and vice versa.
CCMDC Marketing Plan – 2013/14
•
•
•
Identify, re-assess & confirm key markets and
priority end-use customers.
Achieve & maintain sustained commitment to
Canadian beef in select priority markets with
identified priority end-use customers.
Facilitate strategic and consistent growth &
corresponding return on investment within
priority markets with priority end-use
customers
•
•
•
•
Messaging tailored to a diversity of stakeholders to
expand their knowledge of the Canadian Beef
Advantage
Management & staff receive ongoing training and
development
Management and staff receive ongoing industry
exposure.
Management has appropriate succession plans in
place for staff
86
Appendix
Canadian Cattlemen Market Development Council
CCMDC Marketing Plan – 2013/14
87
Appendix
Canadian Cattlemen Market Development Council
Expected results
Results Indicators
(none for outputs)
1. ROI for marketing
efforts (foreign
promotion/domestic
promotion/research)
Method
Frequency
Responsibility
Independent
third party
Econometric
analysis
Every 3 to
5 years
CBI
1. Consumer perception
of the Canadian beef
brand
2. % or # of Canadian
trade partners who
utilize the CBA in
marketing efforts.
Public
Survey
(Ipsos Reid
omnibus)
Project
reports/
Industry
survey
Bi- or triannual
CBI
CBI
3. Foreign customers
rating of Canadian
beef compared to
competitors
Importers and
other key
foreign buyers
Foreign
buyer
survey
Short Term Result 1a
1. # of website hits
Website
Increased awareness of the
Canadian beef brand by
Canadian consumers
2. # of consumer
influencers reached
directly through
marketing activities
3. Perception of key
consumer
influencers
(health/media/other)
4. # of communications
programs developed
and disseminated to
different target groups
1. Level of
understanding of
CBA by targeted
Canadian trade
industry
Project reports
Website
statistics
Document
review
Bi-annual
or if
annual,
random
sample
Bi-annual
or if
annual,
random
sample
Annual
Annual
CBI
Long Term Goal
A profitable, sustainable
Canadian industry that results in
Canadian beef and cattle being
recognized as the most
outstanding by Canadian and
world customers
Medium Term Result 1
Increased commitment to the
Canadian beef brand and
genetics
Short Term Result 1b
Increased ability of the
Canadian beef industry
articulate advantages of the
CCMDC Marketing Plan – 2013/14
Baseline
Target
Data source
Packers,
processors,
exporters
CBI
Comment
Contracted to credible third
party source
Surveys compiled with
input from CRS, data
interpretation provided by
CRS
CBI
Customer
assessments
Count of
participants
Bi- or triannual
CBI
Health and
media
Consumer
influencer
survey
Annual
CBI
Packers,
processors,
exporters
Industry
survey
Bi-annual
or if
annual,
random
sample
CBI
Survey efforts should be
combined with CBBC if
possible
88
Appendix
Canadian Cattlemen Market Development Council
Expected results
Canadian beef brand
Short Term Result 1c
Increase foreign customer
awareness and understanding of
the Canadian beef brand
Medium Term Result 2
Strategically managed market
share to optimize product value
Short Term Result 2a
Market intelligence provided to
Canadian beef industry
Results Indicators
(none for outputs)
2. Number of trade
industry
representatives made
aware of the CBA
through funded
initiatives
1. Level of
understanding of
CBA by targeted
foreign customers
Baseline
Target
Data source
Method
Frequency
Responsibility
Comment
Project reports
Document
review
Annual
CBI
Importers and
other key
foreign buyers
Foreign
buyer
survey
CBI
2. Number of targeted
buyers/distributors
made aware of the
CBA through funded
initiatives
1. Canadian share of
domestic market
Project reports
Document
review
Bi-annual
or if
annual,
random
sample
Annual
CanFax
Statistical
review
Annual
CBI
2. Canadian composite
cut out value versus US
composite cut out value
CanFax
Data
analysis
Annual
CBI
3. Change in 'in-market'
price differential
between Canadian and
competing products in
all markets
(Value/volume)
CBI
GMIR/CanFax
Data
analysis
Annual
CBI
The data provided may be a
proxy for the indicator as it
may not be possible to fully
gather the indicated data.
Data collected through
GMIR, interpreted by CRS
4. Wholesale beef
demand index
CanFax
Data
analysis
Annual
CBI
CanFax expects to have
index data available in April
2012.
1. Industry assessment
of usefulness of market
intelligence
Packers,
processors,
exporters
Industry
survey
CBI
Survey of GMIR Recipients
2. Industry utilization
of market intelligence
Packers,
processors,
Industry
survey
Bi-annual
or if
annual,
random
sample
Bi-annual
or if
CBI
Survey of GMIR recipients
CCMDC Marketing Plan – 2013/14
Surveys compiled with
input from CRS, data
interpretation provided by
CRS
CBI
89
Appendix
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Expected results
Results Indicators
(none for outputs)
Baseline
Target
Data source
Method
Frequency
Responsibility
annual,
random
sample
Annual
CBI
Program
reports
Annual
CBI
Program
reports
Annual
CBI
exporters
Short Term Result 2b
Strengthened targeted customer
relationships
1.% of participants in
marketing activities
reporting direct
financial benefits of
marketing activities
2. # of net new
qualified customers in
foreign markets
3. % of qualified
customers retained
Short Term Result 2c
Differentiated and branded
products and programs
Medium Term Result 3
Strong united commitment to
the CBA by beef industry
supporters/stakeholders
Short Term Result 3
4. # of buyers
participating in branded
programs by foreign
market
5. Brand licensees %
share of the Canadian
retail market.
6. Brand licensees %
share of the food
service and HRI market
1. # of marketing
programs implemented
by industry to improve
price and utilization of
identified cuts
2. Cutout comparisons Canadian vs. US for
priority cuts and
products
1. Leverage on funded
initiatives
1. Consensus and
finalization of the
Canadian beef brand
CCMDC Marketing Plan – 2013/14
Marketing
activity
participants
from past 3
years
Importers and
other key
foreign buyers
Importers and
other key
foreign buyers
Importers and
other key
foreign buyers
MDP
reports
Project
reports
Annual
CBI
Project reports
Document
review
Annual
CBI
Project reports
Document
review
Annual
CBI
Project reports
Document
review
Annual
CBI
CanFax
Data
analysis
Annual
CBI
Project reports
Document
review
Annual
CBI
Project reports
Document
review
Annual
CBI
Comment
90
Appendix
Canadian Cattlemen Market Development Council
Expected results
Increased awareness of the CBA
by industry
supporters/stakeholders.
Results Indicators
(none for outputs)
2. Industry
supporters/stakeholders
awareness of the
Canadian Beef
Advantage
Baseline
Target
Data source
Supporters/
stakeholders
Method
Survey
Frequency
Responsibility
Bi-Annual
CBI
Comment
Survey efforts should be
combined if possible
Glossary
Below is a glossary that provides a description of some of the terms used in the above PMF.
Consumer Influencers – Those individuals, agencies or groups that directly influence the consumer’s decision to buy beef but who are not directly
involved in the market transaction (i.e. supply chain). Examples include health professionals, doctors, dieticians and nutri tionists.
Trade Industry – Domestic Canadian beef trade industry are those businesses, organizations and individuals that make up the beef supply chain
except for producers.
Consumer – For this logic framework, consumer refers to Canadian buyers of Canadian beef in the retail market.
Consumer vs. Customer – Consumer is a retail buyer of Canadian beef. Customer is a wholesale buyer of Canadian beef and genetics.
Foreign Buyers – Any reseller, buyer or distributor whose operating market is not located in Canada.
Foreign Competitors – All offshore competitors to any member of the Canadian beef value chain.
Industry supporters and stakeholders – All those individuals, organizations and groups associated with the beef industry that includes
government and non-government organizations and the private sector.
Net new customers – This is a qualifier to measuring “new customers” and is meant to be measured by offsetting the number of new customers
by the number of customers that are lost (if any) within a specified period of time.
Cutout comparisons – Comparing the price of a particular cut of Canadian beef against its substitute in another market (US).
CCMDC Marketing Plan – 2013/14
91
Appendix
Canadian Cattlemen Market Development Council
Brand licensees – Those individual, organizations and groups with the permission use the Canadian beef brand as part of their promotional and
advertising material.
Market Context Indicators
It needs to be clear that market indicators are not measures of the results of market development activities. Market development activities have
little if any observable impact on the market context indicators. They should thus be placed in a separate section to make it clear to readers that
this is relevant market information but that these are not market development results and that change in these indicators is not the goal of
market development funds and activities.
1. Volume and value of Canadian beef exports
 Total
 By target market
2. Volume and value of exports by product type and destination market
 Cuts vs. offal
3. % share of total Canadian exports by target market
4. Canadian boxed beef report
 Cutout values
 Primal values
 Cut values and load counts
5. Canadian slaughter capacity (fed and non-fed)
6. Utilization of slaughter capacity (fed and non-fed)
7. Fed cattle exports to the US
8. Feeder cattle exports to the US
9. Non-fed cattle exports to the US
It is important to note that these market context indicators need to be flexible in nature. Canfax should add other market context indicators as is
necessary as a way to tell the Canadian and/or global market story in order to provide context to its results reporting.
CCMDC Marketing Plan – 2013/14
92
Appendix
Canadian Cattlemen Market Development Council
CBBC Background and three year market development strategic framework
Background
The Canadian Beef Breeds Council (CBBC) is the recognized representative body of Canada’s seed stock
producers; serving an important liaison function with government and other elements of the beef cattle
industry, while effectively promoting Canada as the source of quality beef cattle genetics to
international and domestic buyers and consumers. CBBC membership is a composite of national breed
associations, each representing individual producers of beef cattle breeding stock from across Canada;
and associate members comprised of exporters and service providers. The Canadian Beef Breeds Council
exists to represent and promote Canadian pedigreed beef cattle genetics domestically and
internationally.
CBBC was incorporated in April, 1994 as a not-for-profit organization. Since 1994, the group has enjoyed
a lengthy history as an issues-oriented group championing important causes including animal health as
well as other matters of importance to the sector and purebred producers. The Council serves as a single
point of contact for many government departments and agencies, as well as international contacts.
The cattle and beef industry has experienced important changes in Canada in 2012, particularly after the
announcement of the largest beef recall in North America for E. coli by the Canadian Food Inspection
Agency (CFIA) and XL Foods Inc. The unfortunate situation has impacted every participant of the cattle
and beef value chain, including Canadian producers.
Every organization working for the prosperity of the beef cattle producers in Canada needs to critically
review the plans and create alliances with other national organizations working to improve the
competitiveness of this sector. Joining efforts through aligned strategies with Canada Beef Inc. (CBI), the
Beef Cattle Research Council (BCRC), the Canadian Cattlemen’s Association (CCA) and other important
stakeholders will optimize resources and bring value added marketing opportunities in the area of
genetics to the participants of the beef value chain.
The cow calf beef producers are the most important customers of the purebred producers in Canada,
and the CBBC is focusing on understanding their needs and plans. It is important to remember that
according to the Commercial Producer survey conducted by Ipsos Reid in September, 2006: “99% of
commercial producers use a purebred bull for genetic improvement”. Additional outcomes included
overall importance and value provided by purebred producers and that the most important
considerations when purchasing purebred stock are confirmation, birth weight and breed. Updates to
this research and economic feasibility studies are being explored.
Visions and Mission Statements
CBBC Vision
“To provide a unified voice in support of the Canadian purebred cattle industry”
CBBC Mission
“To ensure the continuity, growth and prosperity of the Canadian purebred cattle industry”
CCMDC Marketing Plan – 2013/14
93
Appendix
Canadian Cattlemen Market Development Council
Mandate
The CBBC has a clear and defined mandate to support, promote and represent its members and the beef
cattle purebred genetics industry as a whole. It is to:
SUPPORT Canadian purebred cattle producers through service provision aimed at genetic improvement,
animal health, extension services and information dissemination;
PROMOTE Canadian cattle genetics both domestically and internationally by identifying market
opportunities, facilitating access through timely intelligence and informing the commercial industry of
the attributes of the Canadian beef advantage both at home and abroad
REPRESENT the purebred cattle industry to government by advocating effective policy, ensuring market
access and enhancing competitiveness.
Three year market development strategic framework
In the interest of improving the capacity of CBBC to plan over the longer term, a three year market
development strategy was developed this year. The development of this three year strategy involved a
highly consultative process and included review and assessment of past market development plans and
activities, interviews with CBBC’s current membership, analysis of this member input followed by the
development of a draft framework. This framework was reviewed extensively by the CBBC’s newly
formed Market Development Committee. This Committee, composed of both association and regular
members, was formed as part of an ongoing governance reform process currently underway at CBBC. A
revised draft framework was then presented to the CBBC Board on December 14, 2011 where it was
approved.
This three year strategy offers a framework by which CBBC can better guide and direct its market
development work. This three year strategy is built on three long term goals common to the Canadian
beef cattle industry. These are:



Build awareness for a Canadian beef identity/brand built on benefits defined by a strong and
clear value proposition
Achieve growth in traditional, existing, new and emerging markets for Canadian beef genetics
products
Maximize the total value realized by the Canadian beef and cattle genetics industry through
optimization of genetics and live cattle values
The three year market development strategic framework developed by/for CBBC is composed of three
main sections that coincide with these three goals. Under each goal, there are a set of main strategies,
each organized into three separate tracks and based on the direct input from CBBC’s members. For each
strategy and track there are a number of tactics that will be used to achieve the strategy and, in turn,
the broader goal.
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Goal #1 – Building Awareness
Goal #1: Build awareness for a Canadian beef identity/brand built on benefits defined by a strong and clear value proposition
Domestic Awareness
1A: Increase awareness and understanding
throughout the entire Canadian beef value chain
(and its relevant organizations) of the importance
of purebred beef cattle genetics to Canada’s
international and domestic beef cattle markets
Tactic 1A1: Develop a coordinated, unified and
effective communication/ education strategy
targeting intermediary buyers and commercial
producers
Tactic 1A2: CBBC to champion/manage ongoing
inter-industry (producers, packers, etc.) dialogue
within the beef cattle sector to articulate the
connection between beef cattle purebred genetics
and beef quality/beef characteristics (CBA). This
may involve integration with the CBBC’s 4Ps.
Tactic 1A3: Establish CBBC as the authority and
education/ information hub on purebred beef
genetics for its members, the beef industry and the
public at large
International Awareness
Protecting the CBA brand
Strategies
1B: Develop awareness and understanding, in priority export
markets, of beef cattle purebred genetics industry through
support and promotion of the CBA brand
1C: Protect the reputation of the Canadian beef purebred
genetics brand and, by extension, the CBA
Tactics
Tactic 1B1: Develop a coordinated, unified and effective
communication/education strategy targeting intermediary
buyers, foreign wholesalers and foreign buyers of Canadian
beef cattle purebred genetics
Tactic 1B2: Promote the use of the Canadian Beef Advantage
brand in all market development activities of CBBC’s
membership that are supported by the Legacy Fund (CBBC’s
4Ps).
Tactic 1B3: Leverage and provide reciprocal support to CBI
and other beef groups to promote the CBA, beef cattle
purebred genetics and Canadian beef internationally
Tactic 1C1: Develop a responsive, coordinated, unified
and effective crisis management communication strategy,
ideally in collaboration with CCA, CBI and other beef
groups
Tactic 1C2: Preserve and protect Canada’s beef brand
through promotional campaign to increase the
commitment to registration of breeds and breed transfers
Tactic 1C3: Ensure that purebred beef cattle genetics are
properly expressed in foreign markets through after sales
support and extension on proper care and management
of Canadian beef cattle genetic products (bull, semen,
embryos) by new buyers
Key Performance Indicators + 3 Year Targets
Strategy
1A
1A
1B
1C
1C
1C
Indicator
# and diversity of beef value chain members aware of role of purebred genetics in the value
chain
# of inquiries to CBBC on purebred beef genetics
# foreign buyers aware of CBA brand and its relationship to Canadian purebred genetics
Industry-wide communication strategy developed and implemented
% registration of eligible/applicable breeding stock
% registrations of transfers of purebred beef breeding stock sold
CCMDC Marketing Plan – 2013/14
2016 Target
150
5% increase per year
150
Year 1 & 2 - Agreement signed on communication strategy/
Year 3 - Quality and speed of response to industry shocks
Increase 3% per year
100%
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Goal #2 – Achieving growth
Goal #2:Achieve growth in traditional, existing, new and emerging markets for Canadian beef genetics products
Market Access
Planning – Market Development
Implementation – Market Development
Strategies
2A: Improve market access for Canadian beef
2B: Build a cohesive, unified purebred genetics industry
2C: Support breeders and exporters undertake market
cattle genetics in foreign markets
(focusing on breeders) that leverages the strengths of all its
development work to achieve domestic and international
members to capture a greater market share both
market growth of the Canadian beef cattle genetics
domestically and internationally
industry
Tactics
Tactic 2A1: Develop a coordinated, unified and
Tactic 2B1: Develop a clear, transparent and effective
Tactic 2C1: Implement a results-based market
effective external communication strategy that
results-based market development plan to expand
development plan that leads to growth in market share of
effectively guides/promotes the communication
international, export markets of CBBC’s membership
CBBC’s membership in international, export markets
and advocacy of CBBC’s position on key market
Tactic 2B2: Develop a clear, transparent and effective
Tactic 2C2: Implement a results-based market
access challenges
results-based market development plan that expands the
development plan that leads to growth in domestic
Tactic 2A2: In conjunctions with above; increase,
domestic markets of CBBC’s membership
market share for CBBC’s membership
enhance and/or improve strategic representation
Tactic 2B3: At the planning stage, leverage/coordinate the
Tactic 2C3: Promote greater coordination of market
of CBBC on key international, federal and
work of Canada-based international trade shows with the
development activities amongst CBBC members
provincial government, non-government and
facilitation work of CBBC
Tactic 2C4: Build capacity of CBBC and its members to
private sector industry boards, committees and
Tactic 2B4: Coordinate and collaborate, at the planning
collect, analyze and disseminate market intelligence
meetings reduce market barriers (re: tariff and
stage, all market development activities within CBBC’s
information including pre-qualifying all domestic and
non-tariff barriers to market access).
membership as well as between CBBC and with other
international market inquiries
Communicate the results back to membership (via
beef/agriculture market development programs and
Tactic 2C5: Protect and ensure the quality of market
Internal Communication Strategy).
domestic trade shows (CBI, CLGA, Agribition, Growing
development activities through improved, equitable
Forward 2)
management of the CBBC’s market development
Tactic 2B5: In cooperation with CBBC’s funding committee,
program.
identify and gain access to alternative market development
support resources to the Legacy Fund for CBBC’s membership
Key Performance Indicators + 3 Year Targets
Strategy
2A
2A
2B/2C
2B/2C
2B/2C
2B/2C
2B/2C
2B/2C
Indicator
# of market issues put forth by CBBC
# of market access issues resolved
Qualified leads15
% qualified leads convert to sales
Time qualified leads take to convert to sales
Change in average per unit value (domestic and international)
Volume of exported purebred Canadian beef cattle breeding stock
Market Assessments
2016 Target
3 top priorities set per year
2-3 market access issues resolved per year
Year 1 – Establish baseline/Year 2&3 – 5% increase per year
Year 1 – Establish baseline/Year 2&3 – 5% increase per year
Year 1 – Establish baseline/Year 2&3 – 5% decrease per year
Year 1 – Establish baseline/Year 2&3 –CPI% increase per year
5% increase per year (all types)
Increased quality and distribution of market intelligence info for
CBBC membership
15
Qualified Leads: A clear match between the product needs of a buyer who has the ability to pay for these products and the supply capabilities of the breed association and/or
exporter
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Goal #3 – Maximizing Value
Goal #3: Maximize the total value realized by the Canadian beef and cattle genetics industry through optimization of genetics and live cattle values
Product
3A: Promote the continuous development of the
value-added proposition of the Canadian beef
cattle genetic product
Tactic 3A1: Increase, enhance and/or improve
CBBC’s strategic representation on key federal and
provincial government and industry boards,
committees and meetings for the purposes of
advocating for development, implementation and
enforcement of policies that preserve the value of
purebred beef cattle genetics (e.g. Animal
Pedigree Act (APA), health protocols).
Communicate results back to membership (via
Internal Communication Strategy).
Tactic 3A2: Spearhead and aggressively champion
any research that serves the genetics industry and,
in particular, research that supports continuous
genetic improvements
Tactic 3A3: Ensure that purebred beef cattle
genetics are properly expressed in foreign markets
through after sales support and extension on
proper care and management of Canadian beef
cattle genetic products (bull, semen, embryos) by
new buyers
Strategy
3A/3B/3C
3A/3B/3C
3A/3B/3C
3A/3B/3C
Price
Strategies
3B: Promote and advocate for the preservation of the
value/price of Canadian purebred genetic products is
maintained or increases in international markets
Tactics
Tactic 3B1 Build a product information and communication
strategy with industry that ensures that Canada’s premium
quality genetics products are not devalued in the
international market place
Willingness to Pay - Reputation
3C: Preserve and protect the reputation of Canadian beef
as a safe, healthy, nutritious protein product
Tactic 3C1: Engage international network of breeders for
information exchange and sharing on promoting value
and benefits of the different breed stock that make up
the Canadian beef cattle purebred genetics industry
Tactic 3C2: Build capacity and skills of breeders to market
and competitively sell their products domestically and
overseas
Key Performance Indicators + 3 Year Targets
Indicator
2016 Target
Performance- Success rate of product
Year 1 – Establish baseline/Year 2&3 TBD – e.g. 70-80% conception rate
Predictability – Best results, regardless of location
Year 1 – Establish baseline/Year 2&3 – TBD
Pedigree (APA) -% breeding stock registrations
Increase 3% per year
Change in average, per unit value (domestic and international)
Year 1 – Establish baseline/Year 2&3 –CPI% increase per year
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CBBC Logic framework
Below is CBBC’s logic framework. This framework provides greater context between the work of CBBC, as described by the strategies in Section
4, and the expected short term, medium term and long term results they seek to achieve. This framework is premised on the assumption that
successfully achieving short term results will lead to the achievement of medium term results which will also lead to long term result: a
profitable and sustainable Canadian beef cattle industry.
Short Term Results
(Immediate Outcome)
Annual Market Development
Plan
Medium Term Results
(Intermediate Outcome)
3 year Strategic Plan
Long Term Goal
(Impact)
10 year
Long Term Result
A profitable, sustainable Canadian industry that
results in the Canadian beef industry and cattle being
recognized as the most outstanding by Canadian and
world customers
Long Term Indicators:
1. ROI for marketing efforts (foreign
promotion/domestic promotion/research)
Medium Term Result 1
Build awareness for a Canadian beef identity/brand built
on benefits defined by a strong and clear value
proposition
Medium Term Indicators:
1. Consumer perception of the Canadian beef brand
2. % of Canadian trade industry who utilize CBA in
marketing efforts.
3. Foreign customers rating of Canadian beef genetics
compared to competitors
Short Term
Result 1a
Increased
awareness of
the Canadian
beef breed
brand by
Canadian
buyers
Short Term
Result 1b
Increased
ability of the
Canadian beef
industry to
articulate
advantages of
the Canadian
beef breed
brand
CCMDC Marketing Plan – 2013/14
Short Term
Result 1c
Increase
foreign
customer
awareness
and
understanding
of the
Canadian beef
breed brand
Medium Term Result 2
Achieve growth in traditional, existing, new and
emerging markets for Canadian beef genetics products
Medium Term Indicators:
1. Volume and value of sales by market for CBBC
members (export)
2. Volume and value of sales by market for CBBC
members (domestic)
Short Term Result 2a
Market intelligence
provided to Canadian
beef industry
Short Term Result 2b
Strengthened targeted
domestic and foreign
customer relationships
Medium Term Result 3
Maximize the total value
realized by the Canadian beef
and cattle genetics industry
through optimization of
genetics and live cattle values
Medium Term Indicators:
Leverage on funded initiatives
Short Term Result 3a
Increased awareness of the
Canadian beef breed brand by
industry
supporters/stakeholders.
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Canadian Cattlemen Market Development Council
Short Term
Indicators
1. # of website
hits
2. # of
consumer
influencers
reached
directly
through
marketing
activities
3. # of
communicati
ons programs
developed
and
disseminated
to different
target groups
Short Term
Indicators
1. Number of
trade
industry
representati
ves made
aware of the
CBA through
funded
initiatives
3. CBA info
posted on
BAs
websites
Short Term
Indicators
1. Level of
understand
ing of CBA
by foreign
customers
2. Number of
buyers /
distributors
made
aware of
the CBA
through
funded
initiatives
Short Term Indicators
Short Term Indicators
1. Industry assessment
of usefulness of
market intelligence
2. Industry utilization of
market intelligence
1.# of net new qualified
foreign buyers in
foreign markets
2.% of qualified buyers
retained in foreign
markets (customer
loyalty).
Short Term Indicators
1. Industry
supporters/stakeholders
awareness of the Canadian
Beef Advantage
Market Strategies & Activities
CBBC Strategies
1A: Increase awareness and understanding throughout the
entire Canadian beef value chain (and its relevant
organizations) of the importance of purebred beef cattle
genetics to Canada’s international and domestic beef cattle
markets
2A: Improve market access for Canadian beef cattle genetics
in foreign markets
1B: Develop awareness and understanding, in priority
export markets, of beef cattle purebred genetics industry
through support and promotion of the CBA brand
2B: Build a cohesive, unified purebred genetics industry
(focusing on breeders) that leverages the strengths of all its
members to capture a greater market share both
domestically and internationally
1C: Protect the reputation of the Canadian beef purebred
genetics brand and, by extension, the CBA
2C: Support breeders and exporters undertake market
development work to achieve domestic and international
market growth of the Canadian beef cattle genetics industry
3A: Promote the continuous
development of the valueadded proposition of the
Canadian beef cattle genetic
product
3B: Promote and advocate for
the preservation of the
value/price of Canadian
purebred genetic products is
maintained or increases in
international markets
3C: Preserve and protect the
reputation of Canadian beef as
a safe, healthy, nutritious
protein product
Market Development Program Management including eligibility criteria, application processing, reporting & monitoring including setting reference point (i.e.
baseline)
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