A&W move to grass-fed beef gets mixed reaction from beef sector

A commitment by A&W to exclusively source and serve Canadian grass-fed and finished beef in all its restaurants was greeted with both optimism and skepticism in the beef sector.

The restaurant chain, a major buyer of Canadian beef, said last week that it plans to buy millions more pounds of Canadian grass-fed beef in 2020. However, it will take time to meet its stated goal of serving 100 percent of that product in all restaurants, said Susan Senecal, president and chief executive officer of A&W.

“We’ve been working on this for quite a while. It’s been about three years, I guess, since we started thinking about, talking about and engaging with some Canadian producers (and) starting to understand what kinds of opportunities we might have.

“All of our existing suppliers have indicated their willingness to participate and their ability to participate, which is great, but we’ve also expanded that to producers that haven’t necessarily been part of our program because they’re already in grass-fed or because for them we provide a bit of an easier path to market.”

Cattle producer Sean McGrath of Vermilion, Alta., is among those who see opportunity in the A&W announcement, although he questions its ability to find enough grass-fed and finished product for its needs.

“I actually see it as an opportunity for the industry but I question how they’re going to scale it and how they’re going to scale it fast enough. And maybe it means that they’re going to focus on direct purchase of cull cows, for example. A lot of the meat they’re selling is going to be grind and trim, so I’m wondering if they’re going to source through direct purchase of cull cows.

“I think if they went after that grind or that lean trim on the cow side, I think there’d have to be some certification done but I think there’s probably something of a supply there.”

Rachel Herbert, who operates Trail’s End Beef with her husband, Tyler, near Nanton, Alta., also questioned the supply side of A&W’s plans. Trail’s End has been producing grass-fed and grass-finished beef for about 15 years.

“There is very little supply of grass fed finished beef in Canada,” Herbert said. “I’m just speculating they’ll be using cull cows for their ground beef.”

That said, she suggested interest in the commodity from a business as large as A&W might boost demand and capacity for grass-fed and finished product.

“We need to be having those discussions as an industry. The industry seems to be blocked, doing an amazing job on the cow-calf end but not so much the finishing end,” she said.

As for the speed of obtaining needed supply, Herbert said it’s a long game.

“If they’re wanting grass-finished beef, they’re really going to be having to look three years down the road. That’s what we do with our production. By the time you have a calf born and you see it through to the age where prime beef is finished on grass — we’re slaughtering around 26 to 29 months and that’s fairly industry standard as far as the grass-fed industry.”

A&W has been criticized in the past by some in the beef industry because of its advertising of beef free of antibiotics and additional hormones and the implied suggestion that other beef lacked quality.

However, Senecal said the company has found beef producers interested and enthused about its latest approach, which relates to regenerative agriculture and the value of having cattle graze the landscape, help maintain the fragile native grassland ecosystem and assist in carbon capture of soil, while also converting grass into beef.

“We focus a lot on beef and we’ve always invested in our beef and I think as we keep seeing what’s going on in the marketplace, what opportunities there are for us and our producers, grass-fed beef and the idea of regenerative agriculture really stood out,” she said.

“I think we’re big enough to make a difference when it comes to supply chain but small enough be able to meet the needs of smaller producers.”

Herbert said regenerative is the latest buzzword and the practice of raising cattle on grass has always focused on animal and environmental health.

“What raises the skepticism with a lot of us grass-fed producers is, is this just another greenwashing of the same product… which compromises the really hard work that so many of us have been doing for years.”

Senecal said there will be a certification process for those supplying product to A&W to ensure it is from cattle raised on a grass and forage diet and which have access to pasture for as much of the year as possible to retain the regenerative focus.

A&W will also pay a premium to obtain the desired beef.

“It’s an important point,” Senecal said. “One of the things that’s nice about it is we not only want to have more Canadian grass-fed beef, we want to pay more for it. We know that it costs more to raise cattle this way and we want to reflect that in the prices that we pay for the beef.

“We’ve already got existing agreements with some of the bigger beef suppliers as well as some of the smaller ones, so it feels like our premiums are in the right range to attract a lot of interest and provide further incentive for people to really take advantage of this opportunity.”

McGrath, who has supplied beef to A&W in the past, said it appears the chain has taken an improved approach to producer engagement with its latest initiative and its sales growth in the last five years indicate it has made some smart decisions.

“I know they’ve burned a lot of social equity in the industry but from an objective perspective, if you step back and look at it objectively, it’s a niche.

It’s another way to market beef. It’s targeting a bit of a different demographic and if it increases demand and raises prices… have at ‘er, truth in advertising aside.”

The Alberta Cattle Feeders Association responded to A&W’s plans for grass-fed product with pleasure at seeing an all-Canadian beef commitment but concern about how the chain will promote it to consumers.

“We want to ensure consumers recognize that grain-finished beef is just as nutritious and, actually, more environmentally beneficial than grass-fed,” said ACFA chair Greg Schmidt.

The ACFA noted about 98 percent of beef eaten in Canada is grain-fed, not grass-fed, although all cattle start their lives on grass and forage. As well, the ACFA said because grass-fed cattle take longer to finish, they produce more methane, a greenhouse gas, during their lifetimes. That longer lifespan also means they consume more water and require more land per pound of beef produced.

If A&W’s new plan increases demand for beef of any kind, McGrath said he’s supportive.

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