Prof Hettie Schönfeldt
School of Natural and Agricultural Sciences
1
Current Issues
1. Little & declining knowledge of the positive role of
red meat in nutrition and health
2. Environmental impact of the industry
3. Convenience, indulgence, traditional product
4. Value for money
Identified problems:
– Lack of education & communication along the red meat
chain
– Negative influence of media (nutrition, health &
environment)
Brussels, 2009
2
Current Issues
Increased globalization of the red meat industry
&
New food trends are observed
Provides a challenge to red meat industry:
1. Increased possibility of international collaboration &
alignment
2. Encourages change in all sectors – “from farm to plate”
3. Opportunity to increase consumer knowledge and thus
consumption
Brussels, 2009
3
1. Increased possibility of international
collaboration & alignment
● Globalization gained importance due to market liberalization &
technology
● Severe consequences for market structures & strategies
– From agriculture & food processing to food retail & service
– Increased market concentration & density
> worldwide consumer preference – increase in large food companies
> regional differentiation – increase in specialist products
● Meat consumption continually increasing
– Increased impact on import / export + production
● The global system emphasizes:
–
–
–
–
–
–
Grain-fed cattle in feedlots
Special breeds that can graze more marginal & fragile habitats
Use of growth hormones and antibiotics
Environmental and social impact
Government subsidies & policy
International alignment in standards & policy
4
World Meat Production
Million Metric Tons (CWE)
120
100
1970
1980
1990
2000
2010
80
60
40
20
0
Beef
Ovine
Pork
Poultry
Source: FAO
5
Major Meat Producers 2002
Beef
USA
Aust/NZ
China
Brazil
EU
Other
USA
EU
China
Other
Pork
USA
Brazil
EU
China
Other
Poultry
Aust/NZ
China
Other Asia
EU
Africa
Other
Ovine
Source: USDA
6
World Meat Trade
Million Metric Tons
12
10
1970
1980
1990
2000
2010
8
6
4
2
0
Beef
Ovine
Pork
Poultry
Source: FAO
7
The Impact of Trade Liberalization
(1,000 MT)
U.S. Beef Exports 1970-2000
China PNTR (00)
Japan Beef-Citrus
Agreement (88)
Canadian Free Trade
Agreement (89)
Uruguay
Round (95)
Tokyo Round (78)
Korea Beef
North American Free
Agreement (93) Trade Agreement (94)
Japan SPS
Agreement (84)
8
Percent of Production Exported
World Trade in Meat as a Percent of Production
14%
12%
10%
1970
1980
1990
2000
8%
6%
4%
2%
0%
Beef
Ovine
Pork
Poultry
Source: FAO
9
Summary: Increased possibility of international
collaboration & alignment
●The world market for meat products is growing
●Exporters have cooperated in opening markets for
half a century
●Producers, exporters, importers and other role
players should continue to cooperate in nontraditional ways to “raise all ships”
US Meat Export Federation
10
2. Encouraged change in all sectors – “from farm to
plate”
Consumers of today:
• Curious: searching authentic experiences more than
products
• Realists: (very) careful to the quality/price relation of
the acquired product/service
• Social: interested in relationships and situations that
create “community”
• And then,…… informed (very),…… autonomous (they
feel like deciding),…….. ethical….
11
The South African consumer
●Population of 46 million people of which 79% are
black Africans
●Classified according to LSM (Living standards
measure) groups:
– A marketing research tool to gain better understanding
of the socio-economic status of individual / group
– SA is segmented into 10 LSM groups (10 being the
highest standard and 1 the lowest)
– People are segmented according to their standard of
living
> E.g. degree of urbanization, ownership of cars and major
appliances etc as variables
12
13
The South African consumer market:
LSM classification
LSM 10
LSM 9
LSM 8
LSM 7
LSM 6
LSM 5
LSM 4
LSM 3
LSM 2
5000
4000
3000
2000
1000
0
LSM 1
Population ('000)
(Source: SAARF, 2004)
35 % of LSM 6 to 10 are black
14
20.0
20
15.0
15
10.0
10
5.0
5
0.0
0
1
2
3
4
5
6
7
8
9
10
Average monthly income
(R'000)
% of SA population
The SU-LSM segments:
Proportion of SA population and average monthly income
(SAARF, 2005)
SU-LSM group
% of SA population
Average monthly income (R'000)
15
Dynamics in the SA consumer market
- 45%
40.0
35.0
-(-29%)
45%
+ 14%
(+ 6%)
+14%
30.0
+ 40%
40%
(++26%)
2001
2002
%
25.0
2003
20.0
+ 36%
15.0
(+ 28%)
+36%
2004
2005
2006
2007
2008
10.0
5.0
0.0
LSM 1-3
LSM 4-5
Vermeulen, 2005
LSM 6-8
LSM 9-10
Comparing 2001 to 2008
16
Comparing 2001 to 2007
16
Household growth exceeds population growth
+16% growth in population
8,319
Year
1995
Source: SAARF AMPS
8,478
1998
9,551
2001
10,500
10,143
26% Increase
Household
Numbers
(2.18m HH)
2005
17
Meat consumption patterns
●Meat is a favourite and popular food in the diet
●However, the popularity of red meat is globally declining in
favour of white meat and other non-meat proteins
●SA Consumption (per capita)
Red meat decreased and white meat increased
(Abstract of Agricultural Statistics, 2008)
18
Meat consumption patterns
●Price difference contributes to this phenomenon
●Perceived health risk associated with the consumption of
products considered to be high in total and saturated fat
●Detrimental effects on health such as increasing
cholesterol levels and increasing health risk
●Concern about the link between high saturated animal
fat intake and CVD as well as certain types of cancers
19
Global consumption of meat (developed vs.
developing countries) (Valin, 2000)
20
Estimated total annual cash expenditure on major meat products per
household per LSM group (2005)
3000.00
2500.00
%
2000.00
1500.00
1000.00
500.00
0.00
LSM1
LSM2
LSM3
LSM4
LSM5
LSM6
LSM7
LSM8
LSM9
LSM10
%
Vermeulen, 2005
Beef
Mutton/Lamb
Pork
Poultry
21
In South Africa
Decrease in the
consumption of
animal fats
22
The South African red meat consumer
Changes over time
–Increasing living standards
–Increase in household numbers, but
decrease in people per household
–Increased prevalence of food trends
>General trend towards white meat
>Decreased intake of animal fats
23
People buy meal solutions, not parts of dead animals
Reasons for food/meal choice:
● “it’s a family favourite”
}
Indulgence
}
Health
}
Convenience
}
Going green
● “a treat/indulgence”
● “it’s good for you”
● “I’m on a diet”
● “It’s quick to prepare/no hassle”
● “easy to wash up”
● “Environmentally friendly”
● “Natural”
24
International consumer
food trends
These trends overlap:
Health
Indulgence /
pleasure
Convenience
Ethics /
environment
25
Consumer food trends
Trend 1: Health
Prominent dimensions:
Reflected in…
• General wellbeing
• Dieting
• Bioavailability
• Specific health issues
• Supplements
• Natural
• Functional promises
(natural & ‘plus’ claims)
• ‘Minus’ claims
26
Consumer food trends
Trend 2: Convenience
•Time-pressed consumers
•Usually combined with health and/or indulgence
Prominent dimensions:
Reflected in …
• Ready-meals
• Fragmented eating
• Children nutrition
• Product innovation
• Packaging innovation
• Distribution innovation
27
Consumer food trends
Trend 3: Indulgence
•Excitement, diversity, sophistication
Prominent dimensions:
• Product presentation
• Taste, flavour
• Culture foods
• Ethnic foods
Reflected in …
• Product & packaging
• Labeling
• Novel ingredients –wild
and underutilized foods
• Novel combinations
• Texture
• ‘Culture’ foods
28
Consumer food trends
Trend 4: Going ‘green’
• Environmental sustainability
• Social sustainability
• Less important globally
• For example:
Organic
Free range
Fair trade
Food miles
Carbon footprint
Biodiversity
Reflected in …
• Local
• Seasonal
• Traditional
• Credence values
29
South African consumer trends
(A new product perspective)
Global trends reflected in the local food market:
63
Indulgence
73
67
67
Convenience
59
Health
63
2007
2008
15
Fun / children
17
4
Culture
13
7
Environment
3
0
10
20
30
40
50
60
70
Share (%) of new food products reflecting specific trends (n=30/annum)
Vermeulen, 2005
30
Food Trends
Encouraged change in all sectors
– “from farm to plate”
31
2. Encouraged change in all sectors - HEALTH
●Image of meat as good for you (UK):
32
Image of red meat (UK): Too fatty
33
Image of red meat (UK): Important as part of a healthy
diet
34
The image of red meat as “a healthy choice”
●Inline with food trend: HEALTH, need to change
image of red meat as a “healthy choice as part of a
balanced diet”
● In terms of the South Africa population:
– Obesity:
> 56.2% of the adult population overweight or obese
(Demographic and Health Survey, 2003)
– Undernutrition
> 30.9 % preschool children stunted (Short for their age)
> 50 % of children consume ≤ half the RDA for vit A, vit B2, B3, B6,
folic acid, calcium, iron & zinc
(NFCS, 1999)
> Poor Vit A status: 75% children & 25% women
> Poor iron status: 16% children & 20% women
> Inadequate zinc status: 45% of children
(NFCS, 2005)
35
In terms of undernutrition: Red meat is a nutrient dense
food
●Meat is an excellent source of protein containing all
the essential amino acids
●Good source of many vitamins & minerals
e.g. iron, zinc and the B-vitamins
●In leaner meat the nutrient content is higher, as fat
dilutes the nutrients in the protein matrix
●With the high prevalence of nutritional deficiencies,
the higher percentage of nutrients in lean red
meat, increases the positive health image due to
consumption
36
Global decreases in fat content
of meats observed over time
37
Implication of reduction in fat content of red
meat
SA beef
– need for
35
The implication:
Many meats, according to
recent composition data, in
fact lies within the
recommended fat range
Due to breeding,
slaughtering and
preparation changes
new data
32
SA
lamb
30
25
23.3
Fat percentage
The Heart Foundation and
Cancer Foundation states
that the fat content of food
products consumed should
be less than 10%
21.6
20
18
15
10
12.3
10.7
13
10.7
6.4
5
6
9.01
7.1
5.9
0
1949 1978 1981 1991 1995 1997 1999 2007
Years
38
Encouraged change in all sectors - CONVENIENCE
●Meat species is rarely the main driver of purchase
(UK)
Which meat
am I going to
buy?
What is the meal occasion?
(what’s my budget / how
much time do I have)
Which cut?
Which cut?
Which species?


39
Current
SA
industry
Convenience
GOOD
Basics
BETTER
Had something done
BEST
E.g. Bone in Products
Product is ‘Enhanced’
E.g. Boneless
E.g. Marinated, Basted,
Crusted, Extra Trim
International
+ encourages
change in SA
40
Vacuum Skin
Packaging
CAP-MAP
Packaging
Half or Full Sleeve
Packaging
41
Encouraged change in all sectors - INDULGENCE
Increased consumer trend towards:
●Sense of simplicity
– Back-to-basics is becoming an indulgence
– Natural ingredients
– Clean label foods
– More natural ingredients
– Continue to cook at home
●Authenticity & region specific
– Not just enough to regionally position, but also based
on ingredients from that region
●Increased trend for new and exotic flavors
42
Indulgence
● Hand Made
● Raw added value
● Stuffed & or Marinades
● Extra Matured
43
Extra Tender lamb
Exclusive to Superquinn
The cuts undergo a revolutionary method of maturing
which achieves an increased level of tenderness and
flavour…………for those seeking that little bit more –
extra tender, extra taste, extra special.
Evaluation carried out and concluded that day 10
optimum in terms of tenderness without adversely
affecting product quality
44
Encouraged change in all sectors - GOING GREEN
People are increasingly becoming nostalgic about
simpler times & remain environmentally conscious
●Sustainable gather-systems
– Locally sourced
– More sustainable
– Fairly traded
– Carbon footprints
●“Free from”
●Naturally produced
●Hormone free – linked to health trend
45
3. Opportunity to increase consumer
knowledge and thus consumption
●Consumers are confused about who and what to
believe regarding food choices IFIC Foundation, 2004
●Media – mixed messages
●General belief among consumers that:
●Red meat contributes towards obesity and other
lifestyle diseases
●Red meats are hard to prepare & inconvenient
●The red meat industry is not environmentally friendly
46
I turned Vegan May 7, 2007! It wasn't
difficult to give up animal products. Yes ~
that's all meat, milk, eggs, cheese, yogurt, ice
cream, soup broths, etc.
47
Increased need for industry involvement
Industry involvement:
●Decrease in fat percentage of red meat over time
●Limited change in terms of convenience, indulgence
and “going green”
●Need for more directed marketing
48
A
B
C
• To Have a Product
• To Have a Story to tell
• To have a proper
communication
strategy
49
To Have a Product
50
To Have a Story to tell
51
To have a proper
communication strategy
52
Reach consumers in a way that is
meaningful to them
53
Marketing of red meat
Increasing Consumer Preference
> Through successful communication strategies
> Increase perception of red meat in line with the main food
trends
 Health
 Convenience
 Indulgence
 “Going green” (naturally produced / hormone free etc.)
> Working with others in the supply chain to maintain and grow
consumer demand
54
Example: Presentation
& Packaging
Health
Indulgence
•Meets Legal
Requirements
•Attractive
•Hygienic
Going green
•Low Cost
•Re Cycle
•Simple & easy to Shop
Convenience
55
Retailer Branding
Country of Origin
Indulgence
E.G Labelling
Health
GDA’s
‘Only Contains’
Statement
Photo Illustration
Product Name
Staff Storage
Instruction
Freezable
Convenience
Cooking Time
Customer Storage
Instruction
Customer Use by
Instruction
Pack Price & Packers
code
56
Challenges for the future
1. Sustaining production + supply – improving efficiency
 Need for international collaboration for R&D
2. Red meat production, the environment & climate change
3. Consumer Expectations
 Leaner & more healthy meat
 Need to focus on new customers and marketing segments (younger
generation & Muslim society)
4. Innovation is essential
 Need to capitalise on trends



Boneless products
Products which fit convenience trends
Moving away from traditional cuts to easy to prepare cuts with more enjoyment
and health
 Need for education
Brussels, 2009
57
Behaviour change
5. Consumers
Science Driven
4. Health
professionals
3. Industry
2. Opinion leaders
1.
Science
58
Recommendations
● Create a positive environment for international and local cooperation
● Confront environmental issues
– Research, development, changes & communication
● Highlight advantages of red meat consumption
– Nutrition and health
– Human satisfaction
– Part of a modern, pleasant, convenient and mixed diet
● Differentiate, create and add value for growth in market
● Move to younger generation target market
● Reinvigorate domestic market
– Rise in retail standards
– R&D and communication of the findings
– Specialized generic consumer marketing for behavior change
59
Thank you
Prof Hettie Schönfeldt
Hettie.schonfeldt@up.ac.za
60