How Now Mad Cow?

For Texas cattle ranchers, "What's for dinner?" is a touchy question

The supply-demand pincer first tightened in May, when the United States banned beef and cattle imports from Canada. Not only did the market lose roughly 10 percent of its supplies, U.S. exports surged because U.S. ranchers picked up Canada's foreign customers who also blocked that country's beef. "In the last two years, our export volume of beef and beef products has really jumped and become an important part of our entire industry...it's high-value stuff," Davis says.

According to Davis, the United States and Canada are the only two countries in the world commercially producing high-quality grain-fed beef on a large scale. The United States exports some 10 percent of its production, with Japan, South Korea, Mexico and Canada biting off 90 percent of those shipments. "U.S. beef has set a quality standard that a lot of countries wish they could produce but have not been able to," says Lynn Heinze of the Meat Export Federation. Yet Heinze adds that roughly one-third of what we sell overseas are not well-marbled steaks, but offal, which includes things like stomachs, tongues, hearts and brains.

The market was further aggravated because as beef prices surged through summer and fall to record levels, ranchers drove their cattle to market ahead of schedule, hoping to capitalize on the high price before the United States reopened the door from Canada, which would loosen supplies and depress prices. Those cattle were slaughtered at lighter weights, with many fewer grading high choice and prime. "Our costs went up 30 percent across the board, every cut that we bought," Chamberlain says. "It's by far the most increase in beef this country's ever seen, from a high-end beef standpoint. The price of beef is probably the most consistent thing out there. We've never seen fluctuations like this."

"Life's too short to eat cheap beef," says Richard Chamberlain of Chamberlain's Steak and Chop House.
Mark Graham
"Life's too short to eat cheap beef," says Richard Chamberlain of Chamberlain's Steak and Chop House.
Cattle aren't stupid, says Texas rancher James Fuqua, with wife Lisa and son Reason.
Cattle aren't stupid, says Texas rancher James Fuqua, with wife Lisa and son Reason.

Price isn't the only dynamic that has fluctuated. According to some who remember eating the finer cuts of beef 30 years ago, quality has been in steep decline for decades. Jeffrey Steingarten, author of the award-winning culinary travelogue The Man Who Ate Everything, claims that the government's quality grading system has been significantly and deliberately degraded over the past 50 years. "I have heard old-timers say that the fabled marbling of Japan's costly Kobe beef today looks just like a USDA prime steak did 50 years ago," he writes in Vogue. "The downgrading of American meat is a major scandal, a venal conspiracy first to deprive every American of her right to dine on a profoundly tasty, plump and juicy steak..." Is America's premium beef a lot of baloney?

Beef quality grading began as a set of tentative government standards in the 1920s. The move was met with stiff resistance from major packers, who instead introduced their own house grades, such as Swift Premium and Armour Star. But many in the beef industry argued that those grades were nothing more than the best beef a packer had in a plant on a given day. That inconsistency stirred unrest among operators of hotels, restaurants and supermarket chains.

It wasn't until after World War II that the voluntary USDA quality grading system was universally adopted. In 2003 roughly 92 percent of all cattle slaughtered were graded. The program is divided into eight grades: Five--prime, choice, select, standard and utility--apply to cattle under 42 months old; four grades--commercial, utility, cutter and canner--are used for older cattle. Meat settling into the upper reaches of the grading system is generally channeled into restaurants and hotels, while choice and select are abundant in supermarket cases. Standard and commercial grades are generally sold as "store brand" meat, while utility, cutter and canner grades are rarely sold retail and are instead funneled to packers who grind it out as ground beef and processed products such as sausage and pizza toppings.

In addition to age, grades are determined by carcass color, texture, firmness and, most important for flavor, marbling--the degree to which the meat is flecked with intramuscular fat. Meat graded prime or choice is delineated further, depending on the amount of marbling. These factors are driven by days in the feedlot, type of diet and genetics. The difference between prime and choice is roughly 1.5 to 2 grams of fat per 100 grams of meat. But the process is highly subjective, and inspectors usually spend just a few seconds evaluating each carcass.

"It's kind of like pornography," says rancher James Fuqua of prime. "I can't tell you exactly what it is, but I know it when I see it."

Prime beef supplies have been in steep decline for some 20 years. Beginning in the mid-1960s, the percentage of beef graded prime hovered from 5 to as much as 10 percent before dropping precipitously in the mid-1980s. Since then, the amount of beef grading prime has bounced between just 2 and 3 percent. The supply was reduced by the drive to increase yield (more red meat per carcass) and a consumer push for leaner meat. "Marbling has decreased...from 25 or 30 years ago," says Michael E. Dikeman, professor of animal sciences at Kansas State University in Manhattan, Kansas. "In general, cattle have gotten leaner, and in general when you reduce the fatness, you tend to have a reduction in marbling."

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