Chasing consumer trends
Four trends providing new markets for beef
CHANGES in the way the population is consuming food could shape the future of the beef industry.
At the Young Beef Producers Forum last week, Angus Gidley-Baird, from Rabobank, highlighted four key trends that could provide new opportunities for the red meat industry.
Mr Gidely-Baird said meat consumption would continue to increase.
“We’ve just released our animal protein outlook for next year and we expect total protein production in the world to grow again by a million tonnes,” he said.
“So we continue to produce more and people continue to consume more.”
The four trends Mr GidleyBaird said would be key to future red meat consumption were eating out, meal kits, buying online, and direct to consumer.
PEOPLE are not eating at home as much as they used to.
Mr Gidley-Baird said in the past seven years, the amount Australians spent on food consumed outside the home had grown by 30 per cent.
“We are now spending on average $80 per person outside the house each week,” he said.
“Those between 18-35 are spending even more outside the house each week, more like $100.
“So while the Australian population is increasing at 30 per cent. The millennial population is increasing at about 36-38 per cent.”
In 2014, the United States reached the tipping point where they began spending more on food outside the home than food consumed at home.
“There’s a big fast food industry over in the US and it’s changing the way they’re consuming food,” Mr GidleyBaird said.
“They’re no longer sitting down for a steak and three veg. They’re needing something more mobile.
“You can see the same trends developing in China. It’s taken a bit longer to get there. In the late 1990s you can start to see that increase in food expenditure outside the home.”
THERE are numerous companies such as Hello Fresh which are providing meal kits to make it easier for those who do choose to eat at home.
“The consumer doesn’t have to go into the supermarket and figure out what they need to buy, it’s all there for them,” Mr GidleyBaird said.
“I think this is a great opportunity from an animal protein point of view because not only do we have the opportunity for people to have their set meal and all the ingredients there, but you can actually get different cuts into this.
“For the consumer who knows how to cook a beef burger or some sausages, we can actually start to give them some different cuts within these packages with the other ingredients.
“We can tell them how to cook it, and we can actually sell more of the carcass.”
ACCORDING to Mr GidleyBaird, online grocery sales have increased 23 per cent in the past 12 months, growing faster than any other grocery sales.
“You’re starting to see consumers a little bit more confident now of buying groceries online,” Mr GidleyBaird said.
“Amazon bought Wholefoods last year, it’s one of the biggest online retail platforms in the world. It was the indication they were going to get into grocery sales.
“In Australia they’re looking at how they can increase that platform.
“Alibaba and JD.com are two online platforms in China. They’re trying to get into online grocery sales as well.
“If you go to JD.com and search Aussie beef in there, you will find that there is Australian beef being sold right now online in China.
“It’s a platform being used by processors and industry here to sell beef directly to consumers in China.”
Mr Gidley-Baird said mobile sales were also changing the game for online purchases.
“It’s not sitting down on your computer and buying something online, now people are pulling out their phone and buying things on their phone.
“This is a huge industry in China. They use it as a big platform for a lot of their purchases. Last year in China,
81 trillion Chinese yuan in purchases were made over a mobile phone.
“Which I think is about
$16 trillion Australian.” Mr Gidley-Baird said earlier in the year, he and a Chinese colleague sent a boatload of northern Australian cattle over to China in the live export trade.
“I asked her, ‘How do you deal with a boatload of cattle that turns up? You didn’t have them the week before or the month before. They turn up, they have to go through the strict protocol, they’ve got to be slaughtered before a certain time frame and they can’t be fed. How do you get that out into the consumer market?’
“And she said, ‘We just use WeChat’. They don’t have a retail outlet for this beef, they use WeChat.
“The company that was slaughtering the animals simply posted a note on their WeChat channel within a defined geographical area saying all these things are available and if you want them you can buy them.
“So effectively they went from Australia via boat, to China, were slaughtered, and to the consumer.”
DIRECT TO CONSUMER
MORE and more people are finding ways to get their meat direct from the producers.
“There is a group called Crowd Cow. The basic concept is you log in, find what you want, and once they get to an amount that equals a whole beast, they source that beast direct from the producer, slaughter it and that then gets delivered out,” Mr Gidley-Baird said.
“It’s not going through the traditional retail chain to get to you, it’s going direct to consumer, and the consumer can speak to the producer.
“I think this is something we can capitalise on as the next generation of beef producers, because the consumer is going out and looking for this, and it’s about how you sell that back to them.”
Mr Gidley-Baird said the mobile abattoirs being rolled out would also help join the dots between consumer and producer.
❝ We can actually sell more of the carcass.
— Angus Gidley-Baird
NEW OPPORTUNITIES: Angus Gidley-Baird, from Rabobank, spoke about changing consumer trends at the Young Beef Producers Forum.