An Overview of YOUR Brand: Certified Angus Beef ® Mark McCully Director of Supply Development

Increase the demand for registered Angus cattle… The Brand’s Mission Increase the demand for registered Angus cattle…

Angus Registrations

How? … through a specification-based, branded beef program to identify consistent, high quality beef with superior taste!

Certified Angus Beef ® Brand Structure Owned by the American Angus Association Not-for-profit marketing organization Only own brand – NOT product Licensing agreements with all production and distribution channels Revenue derived from commissions paid by packers and processors 85% of US packing base producing CAB®

Licensing Scope Feedlots Packers Fabricators Ground Beef Processors Further Processors Portion Cutters Food Service Distributors Retail Distributors Restaurants Grocery Stores

USDA Certified Beef Programs- In 2006*– 63 programs *USDA G-Schedule last updated Nov-05

USDA Certified Beef Programs- 2006 63 total programs 48 have a breed in their name (46-Angus; 2-Hereford) 25 have Modest or higher marbling 14 are “Angus” with Modest or higher marbling 19 are USDA Select 8 are “natural” or have natural extensions 2 are USDA Standard/Commercial

Certified Angus Beef ® Brand Product Specifications Live specification – “Angus-type” At least 51% black hide OR AngusSource® tagged - NEW Eight carcass specifications evaluated by USDA/CBGA Graders: Modest or higher degree of marbling Medium or fine marbling texture “A” maturity Consistency: 10-16 in2 REA; < 999 lb HCW - NEW Moderately thick or thicker muscling characteristics No hump on the neck exceeding 2-inch height Practically devoid of internal hemorrhages No dark cutting characteristics

Certified Angus Beef ® Brand Growth Million Pounds

Pounds Sold by Division Why has the miscellaneous category grown? Quantum Foods and others are cutting/re-fabricating and marketing as non-CAB. Grinders Fiscal 2005 *Cannot be assigned to a specific division

Delivering on a promise with… Superior eating satisfaction – flavor, juiciness, and tenderness Consistency Integrity Availability Marketing and Customer Service

Marketing Your Brand Dominate the 80/20 category Promote the “Build a Better Burger” program. (Stop & Shop) ( Sarah - Have several to pass out to the Board) Price Chopper’s ground meat program - Flavored Patties and value added items Fresh Brands went to an 80-/20 program with great success Ray’s offer 80/20, 85/15, 90/10 in CAB Also CAB Natural grind Fred Meyer- 91% CAB grind Roth’s grinds grew 21 % last year. “Fresh ground in the store” QFC to begin grinds in 2005- About 1,000,000 pounds potential Food City- 85/15- kick-off in October Buehler’s five varieties CAB grinds including chubs Giant Eagle CAB fresh flavored patties 12 varieties  

Marketing Your Brand Dominate the 80/20 category Promote the “Build a Better Burger” program. (Stop & Shop) ( Sarah - Have several to pass out to the Board) Price Chopper’s ground meat program - Flavored Patties and value added items Fresh Brands went to an 80-/20 program with great success Ray’s offer 80/20, 85/15, 90/10 in CAB Also CAB Natural grind Fred Meyer- 91% CAB grind Roth’s grinds grew 21 % last year. “Fresh ground in the store” QFC to begin grinds in 2005- About 1,000,000 pounds potential Food City- 85/15- kick-off in October Buehler’s five varieties CAB grinds including chubs Giant Eagle CAB fresh flavored patties 12 varieties  

Marketing Your Brand Dominate the 80/20 category Promote the “Build a Better Burger” program. (Stop & Shop) ( Sarah - Have several to pass out to the Board) Price Chopper’s ground meat program - Flavored Patties and value added items Fresh Brands went to an 80-/20 program with great success Ray’s offer 80/20, 85/15, 90/10 in CAB Also CAB Natural grind Fred Meyer- 91% CAB grind Roth’s grinds grew 21 % last year. “Fresh ground in the store” QFC to begin grinds in 2005- About 1,000,000 pounds potential Food City- 85/15- kick-off in October Buehler’s five varieties CAB grinds including chubs Giant Eagle CAB fresh flavored patties 12 varieties  

Marketing Your Brand Dominate the 80/20 category Promote the “Build a Better Burger” program. (Stop & Shop) ( Sarah - Have several to pass out to the Board) Price Chopper’s ground meat program - Flavored Patties and value added items Fresh Brands went to an 80-/20 program with great success Ray’s offer 80/20, 85/15, 90/10 in CAB Also CAB Natural grind Fred Meyer- 91% CAB grind Roth’s grinds grew 21 % last year. “Fresh ground in the store” QFC to begin grinds in 2005- About 1,000,000 pounds potential Food City- 85/15- kick-off in October Buehler’s five varieties CAB grinds including chubs Giant Eagle CAB fresh flavored patties 12 varieties  

Marketing Your Brand Dominate the 80/20 category Promote the “Build a Better Burger” program. (Stop & Shop) ( Sarah - Have several to pass out to the Board) Price Chopper’s ground meat program - Flavored Patties and value added items Fresh Brands went to an 80-/20 program with great success Ray’s offer 80/20, 85/15, 90/10 in CAB Also CAB Natural grind Fred Meyer- 91% CAB grind Roth’s grinds grew 21 % last year. “Fresh ground in the store” QFC to begin grinds in 2005- About 1,000,000 pounds potential Food City- 85/15- kick-off in October Buehler’s five varieties CAB grinds including chubs Giant Eagle CAB fresh flavored patties 12 varieties  

Marketing Your Brand Dominate the 80/20 category Promote the “Build a Better Burger” program. (Stop & Shop) ( Sarah - Have several to pass out to the Board) Price Chopper’s ground meat program - Flavored Patties and value added items Fresh Brands went to an 80-/20 program with great success Ray’s offer 80/20, 85/15, 90/10 in CAB Also CAB Natural grind Fred Meyer- 91% CAB grind Roth’s grinds grew 21 % last year. “Fresh ground in the store” QFC to begin grinds in 2005- About 1,000,000 pounds potential Food City- 85/15- kick-off in October Buehler’s five varieties CAB grinds including chubs Giant Eagle CAB fresh flavored patties 12 varieties  

Demand for High Quality Beef? A Target: Mid-Choice or higher beef for the upscale domestic and export trade; must have superior eating qualities (tenderness, juiciness, and flavor). Future demand for this product will be approximately 25-30% of the market. Dr. Harlan Ritchie, Distinguished Professor

The challenges ahead….. A branded beef category – many with “Angus” in their name SUPPLY!

Angus Registrations by Year

Angus-type Cattle Identified 12.7 million Angus-type cattle identified in fiscal 2003 Supply continues to grow through our partnerships with feedlots and producers Fiscal Year (October 1 - September 30)

Carcasses Certified 2.2 million carcasses met the Certified Angus Beef ® brand’s high standards in fiscal 2003 Programs help producers better manage cattle to qualify for our brand Fiscal Year (October 1 - September 30)

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