Source: Lisa M. Keefe, MEATINGPLACE, 12/25/17



“Grass-fed” is the buzzy beef category. It has famous fans — from Kobe Bryant to Bill Kurtis, owner of Kansas-based Tallgrass Beef Co. — is believed to be more environmentally friendly by consumers (no feedlots), and even has a health halo.

On the supply side, among special claims by beef brands, “grass-fed” is a relatively easy category to get into.

“Almost all cattle spend 70 percent of their life on grass, anyway,” says Meagan Nelson, associate director of The Perishables Group at market research firm Nielsen. Maintaining a forage regimen is “easier than saying, 'I can’t use antibiotics for two years,’ or, 'I will only use organic feed.’ Grass-fed is really primed in the beef space, particularly, to be a big driver for these value claims, versus others that are stronger in proteins that are quicker-to-market.”

Although the grass-fed beef category remains small, sales are growing relatively quickly. Whether that upward trajectory can continue, however, is in question, even among grass-fed companies.

“Average prices are declining. Growth is slowing significantly. Grass-fed is dead,” says Lenny Lebovich, CEO and founder of PRE Brands LLC, a Chicago-based grass-fed protein company whose products are sold online and through retailers. “Even though there’s overall market growth in terms of dollars, that is the result of increased numbers of stores carrying the product and significantly increased numbers of products. Per-item productivity is negative and the overall profitability of retailers in the segment is abysmal,” he says, while noting that he believes his company will successfully ride out the rough waters.

For more stories, go to www.meatingplace.com.