The DecisionNext team just came back from an energizing trip to the Annual Meat Conference in Nashville. We met with leaders from all corners of the food and ag industry, and were inspired to see how Artificial Intelligence came to the forefront in many of the presentations and discussions. It confirms the critical role technology will continue to play in shaping the future of the meat industry.

Our friends from Midan Marketing recently posted an AMC 2024 Top 10 Takeaways article. It does an awesome job distilling the three days down to the most insightful points. Click here to read the full article posted on their website.

Here are two key observations from Midan that really struck a chord with our team. We’ll also dive deeper into these insights with some additional reflections:

Takeaway 1

Begin to Harness the Power of Artificial Intelligence in the Meat Value Chain

Artificial intelligence (AI) has the potential to dramatically transform retail meat departments and processing plants. Three key areas offer growth opportunities:

• Efficiency: automate to work smarter
• Optimization: make better decisions to get more bang for your buck
• Creativity: reimagine creative functions to become more productive

While data and technology are necessary for any AI transformation, people and process changes are proven to be the most critical factors for success.

AI technologies will also continue to be rolled out at the consumer level, in areas like dynamic personalization for meal planning, predictive grocery shopping and improved traceability via smart labels.

(The Use and Application of Artificial Intelligence – How to Make This Advanced Technology Work for Your Business: Matt Schwartz, Afresh; Alicja Spaulding, Rastelli Foods Group)

DN Reflections: 

In the rapid evolution of the meat value chain, people and process changes will be the critical factor determining the success. Without a doubt.

That said, we heard a common refrain at the conference: it’s getting harder to attract candidates with the required experience to run a meat business. And many of those currently in these roles—with decades of experience—are rapidly aging out of the workforce. 

This is where data and technology need to step in. Properly leveraged, they can ease this transition and empower those less experienced to get up to speed quicker and function at a high level.

AI won’t replace meat traders anytime soon—or ever. The crucial thing is for people to embrace technology and adapt their methods. Because with the right tools, upcoming professionals can easily access industry knowledge and set new standards for the future of the meat businesses.

Takeaway 2

Multiple Factors Affecting the Market Outlook for Meat and Poultry

Pork: In Recovery Mode

2023 was the worst year for pork producers since 1998; however, there have been positive developments in recent months: production costs are lower (and may continue to drop), demand has improved (particularly at wholesale) and is being driven by strong exports, and consumer-level demand has also recovered sharply. Expect consumer-level demand to remain near pre-2021 levels, which were historically good.

Poultry: Profitable Again but Still Facing Headwinds

While lower feed costs have helped poultry regain profits, the industry still faces production challenges: labor and logistics costs remain high, regulatory pressures and sustainability requirements are ramping up and HPAI is still a concern. Despite these headwinds, poultry is well-positioned for 2024. Anticipate strong demand at retail, as boneless breast prices relative to ground beef/loins are favorable.

Beef:  High Quality Drives Consumer Demand

Despite economic challenges, consumer demand for beef remains strong. Much of the credit for this goes to the beef industry itself for its commitment to ongoing, increased production of high-quality meat, evidenced by sustained growth in USDA Choice and Prime grading over the last several years.¹ Furthermore, 92% of shoppers agree that meat/poultry can be a great price, but if it did not taste good, they will not buy it again.²

¹ USDA, Projection CattleFax
² Power of Meat 2024

(Market Outlook for Meat and Poultry, Randy Blach, CattleFax; Steve Meyer, Partners for Production Agriculture; Christine McCracken, Rabobank)

DN Reflections: 

We’re experiencing a time of unprecedented volatility across the protein sector. The old trusted methods that were used to help us understand market dynamics have gone by the wayside. And new approaches are rapidly becoming table stakes for any protein buyer or seller.

Uncovering insight into history and trends is only half of the puzzle. The rest lies in the ability to forecast volatile markets based upon the changing factors that drive volume and price.  We’ve seen this play out across all proteins as our world gets smaller. The data points become more dispersed and intertwined internationally. 

For example, the traditional relationship between Cattle price to Beef Cut values has been  flipped on its head. It started to break down a few years ago as consumer demand for specific grades became more important than beef supply. A new way to forecast beef cuts was needed, so we developed and deployed one. Our solution is detailed in this white paper outlining the new Cut to Graded Cut-out ratio model. Check it out.

This year’s AMC was one to remember. The team made new connections and were able to reconnect with old friends and colleagues as well. More importantly, the discussions around how AI will impact and inform the future of the meat industry took center stage. It’s all about embracing the technology and tools so you’re in position to make better business decisions. And big thanks to Midian for putting together their insightful 10 takeaways article. We can’t wait to see what the next year will bring and we’re looking forward to the next conference.