CENTENNIAL, Colo. — Research shows U.S. consumers and most beef producers have a limited knowledge of what “natural beef” is.

Producers may not realize that natural-marketed beef is a significant factor in the U.S. beef production system. The facts are that this segment - while not huge - is growing rapidly every year.

According to figures distributed by the American Meat Institute and the Organic Trade Assoc., sales of organic meat grew 55 percent in 2005. A recent Internet search yielded 14.8 million results for “natural beef,” while “organic beef” added another 6.4 million hits.

Experts agree that the size of this segment is difficult to gauge due to its rapid growth - and because much of the product billed as natural is sold locally and not reported to statistics services. Still, the National Cattleman’s Beef Assoc. (NCBA) estimates that natural and organic-labeled beef is on the rise.

“This niche may have made its way up to 2 percent of production, up from just 1 percent just a short time ago,” said Joe Schuele, NCBA communications director.

In 2005, it’s estimated that approximately 375,000-425,000 head of bovine were fed as natural - out of about 100 million cattle fed each year in the United States.

The natural beef market in 2005, Schuele said, was estimated to be worth roughly $500-$550 million, or more than 1 percent of total sales.

“It’s not a large industry impact yet, but we can’t minimize the impact (natural beef) is having at the producer or company level,” Schuele noted.

Sales are consistently growing at a pace of more than 20 percent annually. According to the Agricultural Marketing Resource Center (AgMRC), sales of natural beef are on pace to double in size about every three years.

There is no official definition that is universally followed for natural beef. In fact, some companies are concerned that use of the word “natural” is widely misrepresented. USDA’s Food Safety Inspection Service (FSIS) defines natural as meat not containing any artificial coloring, flavoring, chemical preservative or other synthetic ingredients. Also, it must be no more than minimally processed using means such as grinding, freezing or smoking, for example. Using these standards, then nearly all U.S. beef could be called natural.

The differential comes with marketing as both national and local companies are deriving their own interpretation of “natural” and creating a program to fit. Some common uses of the word natural include products that are not fed or injected with antibiotics, not given growth stimulants, raised outside or pastured instead of feedlot finished, dry aged, not frozen, produced from a certain genetic line, sourced from local farmers, source verified, age verified or even treated more humanely.

Most firms seem to agree that while natural can be any combination of factors, it is not USDA Certified Organic - though a 2001 poll of U.S. consumers showed that up to 75 percent surveyed thought “natural” and “organic” were the same thing.

USDA Certified Organic beef must meet the standards set forth in 2002 by the Organic Foods Production Act, which includes a stringent set of criteria for feedstuffs and other production practices. Natural also does not imply that the beef is grass-fed or grass-finished, which means cattle would spend the majority of their lives on pastures not consuming grain.

Also, specific branded beef programs like Certified Angus or Certified Hereford Beef do not imply that the retail product will be billed as natural.

John Butler, CEO of Beef Marketing Group in Great Bend, Kan., said following a distinct program is essential to success with natural beef.

“If we’re going to make label claims, there has to be integrity with these things. We have to be clear to the consumer,” said Butler who explained that Beef Marketing Group, a producer cooperative, has allocated about 30 percent of cattle on feed, roughly 100,000 head annually, to one of two natural product lines; Certified Angus Beef Natural and Star Ranch Natural Angus.

Butler indicated that these brands follow strict protocols including that animals must be Angus and that they are never given antibiotics or growth hormones.

Dr. Mike Boland, an ag economist at Kansas State University, said producers need to know the difference between natural and organic because of costs.

“Costs between using hormones and feeding naturally are between 10-15 percent higher for natural,” he said, noting Certified Organic would be even higher. “People and groups are clearly able to produce (natural beef) and get a return, but I’d argue that anyone is getting super premiums.”

Butler said the value of natural beef depends on the cut.

“Middles (comprised primarily of high-end steak cuts) are still golden - they always are, of course, and there is even more demand for middles with natural beef,” Butler said. “In food service, though, some companies are using pieces and parts that aren’t middles, but there’s got to be more growth here.”

A few restaurants he’s working with are beginning to pay premiums for grinds and other lower-value cuts. A report on the status of the U.S. natural beef market issued last December by the Canadian Agri-Food Trade Service concluded that natural steaks could earn a premium of as much as 50-70 percent more than conventional beef. Ground beef was expected to achieve about 20 percent more.

This farm news was published in the Oct. 18, 2006 issue of Farm World, serving Indiana, Ohio, Illinois, Kentucky, Michigan and Tennessee.