Beef Quality Grading, Yield Grading and Pricing

Beef Quality Grading, Yield Grading and Pricing

Slaughter

By-Products ($/cwt)

$66/cwt $109/cwt

Fab/Processing

Credit Items:Fat $8.50/cwtBone $5/cwt

CH $161.32/cwtSE $154.82/cwt

Dressing % YG & QG

J. D. Tatum, 2000

Dressing Percentage:Hot Carcass Weight, lb

Live Weight, lb

X 100

Beef Carcass Terminology• Muscling

RibeyeRoundSirloinRibChuck

• QualityMarbling, colorTexture,

firmness

• TrimnessRibeyeRoundSirloinShort loinLoin edgeRibChuckKPHCod/udder

USDA Beef Quality Grades

• Quality grades are an estimate of beef palatability

• Tenderness• Juiciness• Flavor

Sex Classes of Beef Carcasses

• Essential for Quality Grading because only Heifers, steers and Cows are Quality Graded.

• Heifer• Steer• Cow

• Bullock• Bull

Graded Not Graded

USDA Quality GradesBased on consideration of two general

factors:1. Physiological Maturity

• Skeletal Maturity• Lean Maturity

2. Marbling (Intramuscular Fat)• Amount• Distribution

USDA Beef Grades• USDA Maturity Scores:

– A, B, C, D, E (young to old)• USDA Marbling Scores:

– Abundant, Moderately Abundant, Slightly Abundant, Moderate, Modest, Small, Slight, Traces, Practically Devoid, Devoid (most to least intramuscular fat)

USDA Quality Grades• Grades of Youthful Carcasses (< 42 mos.)

PrimeChoiceSelectStandard

• Grades of Mature Carcasses (> 42 mos.)CommercialUtilityCutterCanner

Relationship between tenderness and USDA maturity

scores

A B C D E

Maturity

Shea

r For

ce V

alue

s

Physiological Maturity vs Chronological Maturity

• The physiological maturity of the carcass is an estimate of the actual chronological age of the animalUSDA Maturity Score Estimated chronological age

A 9 to 30 months B 30 to 42 months C 42 to 72 months D 72 to 96 months E 96 or more months

Physiological Maturity• Skeletal Maturity is determined by

evaluating the condition of the cartilage in the vertebral column, with heavy emphasis placed on the cartilaginous buttons at the end of the thoracic vertebra

• Lean maturity is determined by the color and firmness of the ribeye at the 12th 13th rib interface

Skeletal MaturityA B C D E

Sacral Distinct separation

Some separation

Fused Fused Fused

Lumbar No ossification

Partial ossification

Mostly ossified

Ossified Ossified

Thoracic* 0-10% 10-35% 35-70% 70-90% 90% +

*Average ossification of first three thoracic vertebra

Determining Lean Maturity

Determining Overall Maturity

• Composite of Lean and Skeletal• Within 40 degrees avg.• More than 40 degrees avg. and then

move 10 degrees toward the skeletal

• Skeletal old and lean young cannot:• Bring to overall back to young if

older than C20

• Cannot move more than 100 degrees from skeletal

Marbling

Slight00 Small00 Modest00

Moderate00 Moderately Abundant00Slightly Abundant00

Degrees of Marbling A*** B C D E

Degrees of Marbling

Slightly Abundant

Prime Slightly Abundant

Moderate Commercial Moderate

Modest Choice Modest

Small Small

Slight Select Utility Slight

Traces Cutter Traces

Practically Devoid

Standard Practically Devoid

Commercial

Utility

Cutter

Prime

Choice

Select

Standard

USDA Quality Grades

Additional Factors that Affect Quality Grades

Ideal

Discounted

Odds of an Unpleasant Eating Experience

USDA Quality Grade

Odds of Having an Unpleasant Eating

Experience

% Steers/Heifers in National Consist

(NBQA, 2000)

Prime 3% (1 in 33) 2%

Upper 2/3 Choice 10% (1 in 10) 17%

Low Choice 16% (1 in 6) 32%

Select 27% (1 in 4) 42%

Standard 50% (1 in 2) 7%

Quality Grade Distribution in 1991 and 1995

Standard Select Low Choice Upper 2/3 Choice

Prime0

10

20

30

40

50

5

47

36

11

16

37 37

18

2

NBQA 1995NBQA 1991

%

Additional Factors that Affect Value

USDA Yield Grades

Beef Yield Grades

• USDA Yield Grades predict the percentage of carcass weight in boneless, closely trimmed retail cuts from the round, loin, rib and chuck

Slaughter

By-Products ($/cwt)

$66/cwt $109/cwt

Fab/Processing

Credit Items:Fat $8.50/cwtBone $5/cwt

CH $161.32/cwtSE $154.82/cwt

Dressing % YG & QG

J. D. Tatum, 2000

Dressing Percentage:Hot Carcass Weight, lb

Live Weight, lb

X 100

USDA Yield GradesYield/Cutability estimates are

determined using four criteria– Hot Carcass Weight, lbs– Adjusted Fat Thickness, in.– Ribeye Area, in2

– % KPH

USDA Yield Grade

USDA YG %BCTRC

12345

52.3 % or More52.3 - 50.0%50.0 - 47.7%47.7 - 45.4%45.4% or Less

%BCTRC =51.34 – 5.784(Adj.Fat) – 0.462(KPH) + 0.740(REA) – 0.0093(HCW)

Yield Grade Basics1. Fat Thickness – 12th Rib2. Rib Eye Area to Hot

Carcass Weight adj.3. Kidney, Pelvic & Heart

Fat

Step 1 Ft thickness 12th rib

Known at PYG (Preliminary Yield Grade)Step 1. Estimate Fat thickness ¾ the distance around the ribeye.

• Measured in inches.Step 2. For every 0.1 inches add .25 to the base 2.00.

Example: FT= 0.6 0.6/0.1 = 6 6 x 0.25 = 1.5 adjustment 2.0 + 1.5 = 3.5 PYG

Yield Grade Basics

1. Fat Thickness – 12th Rib2. Rib Eye Area to Hot

Carcass Weight adjustment3. Kidney, Pelvic & Heart Fat

HCW to REAStep 1. Estimate the REA between the 12th and 13th rib.•Measured in square inches.Step 2. Find the difference between the actual and the ribeye needed for the

weight. Base 600 needs 11.0 and for every 100 lb change in HCW the ribeye area needed changes 1.2 sq. in.

Example: Actual REA= 15.6 HCW= 725 15.6 - ? = ? (diff. in REA x .3)= ??

HCW REA HCW REA600 11.0 825 13.7

625 11.3 850 14.0

650 11.6 875 14.3

675 11.9 900 14.6700 12.2 925 14.9

725 12.5 950 15.2

750 12.8 975 15.5

775 13.1 1000 15.8800 13.4

Ribeye to HCW adjustments

HCW to REAStep 1. Estimate the REA between the 12th and 13th rib.•Measured in square inches.Step 2. Find the difference between the actual and the ribeye needed for the

weight. Base 600 needs 11.0 and for every 100 lb change in HCW the ribeye area needed changes 1.2 sq. in.

Example: Actual REA= 15.6 HCW= 725 15.6 – 12.5 = 3.1 (3.1 x .3)= .93REA adjustment = -0.93

To estimate REA Live

Yield Grade Basics

1. Fat Thickness – 12th Rib

2. Rib Eye Area to Hot Carcass Weight adj.

3. Kidney, Pelvic & Heart Fat

KPHStep 1. Estimate the KPH fat as a % of the Carcass.• Do this by estimating the # of lbs. and dividing by HCW.• Estimate lbs. of fat by estimating the # of softballs of fat are present. 1 softball

weighs about 1 lb.Step 2. Minus the percentage from the base (3.5%) and then for every 0.5%

change in KPH you adjust 0.1 to the Final Yield Grade.Example: HCW = 725 Lbs. of KPH = 36.25 lbs36.25/725= 5% 5% - 3.5% (base)= 1.5 % 1.5/.5 = 33 x .1 = .3 KPH adjustment + 0.3 to the Final Yield grade

KPH of Live Animal

Step 1. Fat thicknessFT= 0.6

0.6/0.1 = 6 6 x 0.25 = 1.5 adjustment

2.0 + 1.5 = 3.5 PYG

Step 2. Ribeye to HCW Actual REA= 15.6 HCW= 725 15.6 – 12.5 = 3.1 (3.1 x .3)= .93

REA adjustment = - 0.93

Step 3. KPHHCW = 725 Lbs. of KPH = 36.25 lbs

36.25/725= 5% 5% - 3.5% (base)= 1.5 %1.5/.5 = 3 3 x .1 = .3

KPH adjustment = + 0.3FINAL YIELD GRADE= 2.87

3 step method Summary Carcass

Step 1. ESTIMATE Fat thicknessFT= 0.6

0.6/0.1 = 6 6 x 0.25 = 1.5 adjustment

2.0 + 1.5 = 3.5 PYG

Step 2. Determine Muscling and Adjust accordingly. For heavier muscled animals subtract from the Yield Grade. For lightermuscled animals add to the yield grade.

Step 3. KPH

Usually an animal will have 2.0 -3.5 % the fatter the animal

normally the more KPH. Adjust after a guess. Or use a standard

of – 0.2 adjustment.

3 step method Summary LIVE

Adopted from: R.E. Taylor. Scientific Farm Animal Production. 4th Ed. 1992.

Yield Grade 2

Adopted from: R.E. Taylor. Scientific Farm Animal Production. 4th Ed. 1992.

Yield Grade 5

Yield Grade 2 Yield Grade 5

Yield Grade 2 Yield Grade 5

Yield Grade 2 Yield Grade 5

Yield Grade 2 Yield Grade 5

Beef Carcass Terminology• Muscling

RibeyeRoundSirloinRibChuck

• QualityMarbling, colorTexture,

firmness

• TrimnessRibeyeRoundSirloinShort loinLoin edgeRibChuckKPHCod/udder

Sample Questions on Beef Carcasses

1. Largest Ribeye?2. Highest Marbling Score?3. Trimmest over lower rib4. Between __ & ___ displayed the most fat over the

round?5. Darkest Lean?6. Plumpest Round?7. Which carcass was displayed trimness, muscling and

quality to the highest degree?8. Between __& __ had the highest degree of marbling?9. Which was the fattest opposite the ribeye?10.Which carcass was the trimmest?

Beef Value Determination

Carcass Cost Basis• Carcass cost basis is the price per cwt of

carcass necessary to realize the same amount of money that was paid for the live animal.

• Carcass cost basis = (Live price per cwt / Dressing %) x

100

Example:

Live Price = $83 / cwt

Dressing Percentage = 62%

($83 / 62) x 100 = $133.87 / cwt carcass cost basis

Simple Carcass Cost BasisRail Pricing Grid

• This method is used by plants when cattle are sold on the rail or by there carcass merit.

Maximum Price BasisThe method used to determine how much

should be paid for the live animal based on:

1) The potential revenue to be received for the carcass.

2) The potential revenue to be received for the by-products, and

3) The cost of converting the live animal into a carcass and by-products.

Example:GivenUSDA Choice Carcass = $105/cwtUSDA Select Carcass = $100/cwtUSDA By-product Value = $8.18/cwtSlaughter cost = $30 per head

A 1250 pound steer that is estimated to grade USDA Choice and dress 63%.

1250 x 0.63 = 787.5 lbs of carcass

787.5 x 105/cwt = $826.88 carcass revenue

1250 x 8.18/cwt = $102.25 by-product revenue

$826.88 estimate carcass revenue+$102.25 estimated by-product revenue-$30 slaughter cost

$901.13 estimated income minus expenses

$901.13 / 1250 lb. Live weight = $72.09/cwt Maximum Price Basis

Carcass Pricing Grid ($/cwt) for March :

Yield Grade

Prime Premium Choice

Choice Select No-Roll

1.5 +$27.73 +$13.08 +$11.35 +$9.25 +$8.60

2.5 +$20.04 +$6.31 +$4.69 +$2.72 +$2.12

3.5 +$14.28 +$1.53 $94.11Base

($1.88) ($2.45)

4 ($15.00) ($15.00) ($15.00) ($15.00) ($15.00)

5 ($20.00) ($20.00) ($20.00) ($20.00) ($20.00)

Terms

• Choice/ Select Spread• Yield Grade Spread

• By-product value = $ 7.73 / cwt Live Weight

• Kill Cost = $ 30.00 / head

• Fabrication Cost = $ 65.00 / head

• Acceptable Carcass Weights = 550 to 950 lbs.

Determine the adjusted carcass and live values ($/cwt) for each of the

following:1) 1100 lb., Dress = 64.0%, Choice- YG 2.5

Drop Credit = $7.73/cwt x (1100 lb./100) = $85.03Carcass Weight = 1100 lb. X .64 = 704 lb.Carcass Price = $ 94.11 (Ch3.5) + $4.69 (Ch.2.5) =

$98.80/cwtAdjusted Carcass Value = $98.80 x (704/100) +

$85.03 (Drop) - $95.00 (Kill & Fab Cost) = $685.58 / (704/100) = $97.38/cwt Carcass Weight

Adjusted Live Value = $685.58 / (1100/100) = $62.33 / cwt Live Weight

2) 1100 lb., Dress = 64.0%, Select YG 2.5

Drop Credit = $7.73/cwt x (1100 lb./100) = $85.03Carcass Weight = 1100 lb. X .64 = 704 lb.Carcass Price = $94.11 (Ch.3.5) + $2.72 (Se2.5) =

$96.83/cwtAdjusted Carcass Value = $96.83 x (704/100) + $

85.03 (Drop) - $95.00 (Kill & Fab Cost) = $671.71 / (704/100) = $95.41/cwt Carcass Weight

Adjusted Live Value = $671.91 / (1100/100) = $61.06 / cwt Live Weight

3) 1200 lb., Dress = 64.5%, Prime YG 1.5

Drop Credit = $7.73/cwt x (1200 lb./100) = $92.76Carcass Weight = 1200 lb. X .645 = 774 lb.Carcass Price = $94.11 (Ch3.5) + $27.73 (Pr1.5) =

$121.84/cwtAdjusted Carcass Value = $121.84 x (774/100) +

$92.76 (Drop) - $95.00 (Kill & Fab Cost) = $940.80 / (774/100) = $121.55/cwt Carcass Weight

Adjusted Live Value = $940.80 / (1200/100) = $78.40 / cwt Live Weight