Operating Committee Recommends Fiscal 2006 Beef Checkoff Budget

Date: Tuesday, June 14, 2005

Operating Committee Recommends Fiscal 2006 Beef Checkoff Budget

KANSAS CITY (June 14, 2005) – The Beef Promotion Operating Committee has recommended a $50 million Cattlemen’s Beef Board budget for fiscal year 2006, reflecting a slight decrease from the $50.5 million budget for fiscal 2005.

The Beef Board, which administers the national checkoff program, projects revenue of $45.4 million for fiscal 2006, plus $4.6 million to be available from current program budgets as a result of projects costing less than originally estimated.

The breakdown of the budget recommendation, which must be approved by the full Beef Board and USDA before any funds are expended, includes the following budget elements: promotion ($25.5 million); research ($7.3 million); consumer information ($5.8 million); industry information ($1.35 million); foreign marketing ($5.1 million); producer communications ($2.2 million); evaluation ($230,000); program development ($120,000); USDA oversight ($200,000); and administration ($2.25 million). The 2006 fiscal year begins Oct. 1, 2005.

“We looked carefully at challenges and opportunities in the marketplace to determine what areas we need to emphasize to give cattlemen the best return on their checkoff dollar,” said Al Svajgr, a producer from Cozad, Neb. and chairman of the Cattlemen’s Beef Board and the Beef Promotion Operating Committee, which met in Kansas City June 8-9, 2005.

“With the recent decision from the Supreme Court that our checkoff program is constitutional, we wanted a budget that will continue concentrating on building demand for beef. It allows us to do this through a combination of promotion, research and information programs that aim to keep beef center-of-plate.”

The recommended research budget for fiscal 2006 represents an increase in funding for additional market research in such areas as developing “kid-friendly” beef product concepts, as well as strategies to integrate beef enjoyment and nutrition messages and enhance program concepts for ground beef. Meanwhile, the committee is recommending slight decreases in the budgets for consumer information, industry information and foreign marketing, based both on increased research needs and on generally tight revenues.

In the coming stages of the fiscal 2006 budgeting process, the full Beef Board will be asked to approve the budget at its meeting in Denver in late July. Joint industry advisory committees and subcommittees also will meet in Denver to prepare recommendations for specific program proposals that are funded with that budget. Those proposals will be considered by the Operating Committee in September, before the Oct. 1 beginning of the fiscal year, and must finally be approved by USDA before any checkoff dollars may be spent.

Funds from the Beef Board for national checkoff programs will be augmented by $10.3 million in voluntary contributions from state beef councils to their national Federation of State Beef Councils, a division of NCBA.

In addition to the budget recommendation for fiscal 2006, the Operating Committee recommended approval of the following amendments to the current fiscal 2005 budget:

Reallocation of $25,000 in producer communications funding for the current (2005) fiscal year – from the producer communications program contracted through the National Cattlemen’s Beef Association (NCBA) to fund additional activity for the “Beefmobile,” a producer-outreach program managed by the National Livestock Producers Association. NCBA requested reallocation of the funds to NLPA based on an abundance of requests for Beefmobile visits to events and auction market sales. The funds were made available from other fiscal 2005 producer communications efforts managed by NCBA coming in under budget.
A request from the U.S. Meat Export Federation to reallocate about $44,000 in Beef Board funding originally planned for beef-promotion programs in China to promotion programs in the Middle East, based on the continued closure of the Chinese market to U.S. beef products and the re-opening of the Egyptian market to the same.
Voted by a 14-6 margin to approve a request from the U.S. Meat Export Federation to transfer about $880,000 in Beef Board funding previously approved for retail and menu promotions in Japan to programs for trade and educational activities in the same country. Because the market is not yet open to U.S. beef, USMEF said there is less imminent need for promotion in retail and menu promotion and more to be used to prepare importers there for the market opening and to reassure consumers about the safety and quality of U.S. beef.

# # #

The Beef Checkoff Program was established as part of the 1985 Farm Bill. The checkoff assesses $1 per head on the sale of live domestic and imported cattle, in addition to a comparable assessment on imported beef and beef products. States retain up to 50 cents on the dollar and forward the other 50 cents per head to the Cattlemen’s Beef Promotion and Research Board, which administers the national checkoff program, subject to USDA approval. # # #

mybeefcheckoff.com

Operating Committee Recommends Fiscal 2006 Beef Checkoff Budget

Operating Committee Recommends Fiscal 2006 Beef Checkoff Budget