National Meat Case Study 2010 Overview with Packaging National Turkey Federation 2/10/11

22010 NMCS Research All Rights Reserved National Meat Case Study Objectives To take a comprehensive look at the U.S. fresh meat case. Build science-based trend analysis over time. Identify changes in today’s meat case. Reveal areas of opportunities. To supplement other industry research.

NMCS Research All Rights Reserved 2010 National Meat Case Study Methodology Audit Team Texas Tech University, Cryovac, National Pork Board, National Cattleman’s Beef Association Sample Major Supermarket Chains All continental US geographic areas Northeast, Southeast, Midwest, Mountain and West Coast. 72% repeated 2007 Study Supermarkets. Scope Physical Count of all Beef, Pork, Veal, Chicken, Turkey, and Lamb, including Sausage, Heat & Serve, and Value-Added. Self-Service & Full Service Linear Feet Counting and Description of SKUs for the Portion of the Meat Case Where Packages Were Not Counted. Merchandising Practices and Point-of- Purchase Materials. Procedures Data gathered in first quarter Visited supermarkets at various times of day and each day of the week. Goal. To be representative of major supermarket chains and major metro markets.

The Audits Yielded Large Package Counts to Draw Conclusions The 2002 Sample did not include Heat and Serve, Smoked Offal, Corned Beef and Sausage and the 2004 Sample did not include Heat & Serve and Corned Beef. The 2007 and 2010 sample included these additional items. Club Store information was first collected in NMCS Research All Rights Reserved 4

5 Self-Service Non-Fresh Meat Linear Feet Gained Share in 2010 Percent of Linear Feet  Fresh Meat: Beef, Pork, Lamb, Veal, Chicken, Turkey and Other.  Non-Fresh Meat: Processed, Sausage, Ham, Seafood, Heat & Serve, Value-Added and Non-Meat NMCS Research All Rights Reserved

6 Ground Beef Gained Share in Linear Feet in Fresh Meat Percent of Linear Feet Beef (Whole Muscle) and Ground Beef Combined in NMCS Research All Rights Reserved

7 Beef SKUs Increased in the Average Supermarket Supermarkets Stocked Fewer Lamb and Veal SKUs SKUs were assigned if any of the following factors changed: Product, Bone Content, Value-Added, Enhanced (Moisture Added), Case Ready, Printed, Exact Weight, Nutritional Information, Cook Information, Average Package Weight, Tray Color, Tray Type, Brand, Natural or Organic. Average SKU’s for Supermarkets Displaying Items 7

8 Seafood Linear Feet Led the Full Service Meat Case Total Beef and Chicken Increased Share Percent of Linear Feet Fresh Sausage and Ground Beef were collected as separate categories for the first time in NMCS Research All Rights Reserved

9 Species/Category (% of Supermarkets Displaying Species in Full Service Case) Roast Steak Chops Ground Patties Ribs Tenderloins Whole Value-Add Heat & Serve Offal 07Beef (51%)63%95%11%53%19% 2%5% 10Beef (56%)60%96%6%46%16%59%3% 07Ground Beef (44%)94%40% 10Ground Beef (48%)93%71% 07Pork (50%)45%10%92%15%2%48%28%15% 3% 10Pork (56%)50%9%87%1%47%26%19%64% 07Lamb (12%)20%7%67%7%13%20%0%33% 0% 10Lamb (10%)41%8%75%17%8%25%3% Full Service Cases Displayed Variety % of Supermarkets Displaying Selected Categories within Each Species % of Supermarkets with Full Service Cases: 2010 (77%), 2007 (79%), 2004 (70%), and 2002 (67%) NMCS Research All Rights Reserved

NMCS Research All Rights Reserved Species/Category (% of Supermarkets Displaying Species in Full Service Case) Steak Ground Patties Ribs Tenderloins Whole Value-Added Heat & Serve Breast Parts Offal Fillets 07Chicken (44%)0%8%4%0%30%19% 4%75%19%2%0% 10Chicken (52%)2%20%21%72%78%22%2% 07Turkey (8%)0%50%0% 10%0% 20%10%0% 10Turkey (9%)64%18% 07Seafood (75%)0% 62% 25%0% 98% 10Seafood (77%)78%74%92% In 2010, the following categories were in significantly fewer supermarkets than in 2007: Other Fresh Meat9%2% Fresh Sausage27%8% Non-Meat12%2% Veal6%3% Full Service Cases Displayed Variety % of Supermarkets Displaying Selected Categories within Each Species NMCS Research All Rights Reserved % of Supermarkets with Full Service Cases: 2010 (77%), 2007 (79%), 2004 (70%), and 2002 (67%).

NMCS Research All Rights Reserved Percentage of Packages Per Species Was Consistent Fresh Meat or Poultry Category Self-Service Only Percent of Packages Counted Point Change Chicken29%28% 29%+1% Beef (Whole Muscle)29%27%25% 0% Pork20%22% 20%-2% Ground Beef13%14%15% 0% Turkey6% 7% 0% Lamb2% 0% Veal1% 0% Other<1% 1%0% Total100% This analysis excludes Sausage, Smoked Offal, Heat & Serve, and Corned Beef.

NMCS Research All Rights Reserved Percentage of Pounds Per Species Was Also Consistent Fresh Meat or Poultry Category Self-Service Only Percent of Pounds Counted Point Change Chicken35%36% 0% Beef (Whole Muscle)24%21% 0% Pork22%23%22%21%-1% Ground Beef12%13% 0% Turkey6% 0% Lamb1% 2%+1% Veal<1% 1%<1%-<1% Other<1% 1%+<1% Total100% 0% This analysis excludes Sausage, Smoked Offal, Heat & Serve, and Corned Beef.

NMCS Research All Rights Reserved Percentage of SKUs Per Species Was Consistent Fresh Meat or Poultry Category Self-Service Only Percent of SKUs Counted Point Change Chicken20% 21%+1% Beef (Whole Muscle)38%36%34%35%+1% Pork22%25%23% 0% Ground Beef9% 10% 0% Turkey6% 7%6%-1% Lamb3% 0% Veal2%1%2%1%-1% Other<1% 1% 0% Total100% 0% This analysis excludes Sausage, Smoked Offal, Heat & Serve, and Corned Beef.

NMCS Research All Rights Reserved Average Pounds Per Package Remained Stable in 2010 Pounds Per Package This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked.

NMCS Research All Rights Reserved Average Weights of Beef, Ground Beef and Pork Packages Were Stable Pounds Per Package This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked.

NMCS Research All Rights Reserved Average Chicken and Turkey Packages Were Maintained Average Weights Pounds Per Package This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal.

NMCS Research All Rights Reserved Average Packages Per Foot Declined Again in 2010 Packages Per Foot This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal.

NMCS Research All Rights Reserved Ground Beef and Pork Had Fewer Packages Per Foot Packages Per Foot Beef (Whole Muscle) and Ground Beef Were Combined into One Category in This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal.

NMCS Research All Rights Reserved Turkey and Veal Had Increased Packages Per Foot Packages Per Foot This analysis excludes Sausage, Heat &Serve, Corned Beef, and Smoked Offal.

NMCS Research All Rights Reserved Boneless Share Grew in 2010 Percent of Packages This analysis excludes Ground Meat and Poultry, Sausage, Offal, Ingredients, and Miscellaneous cuts, in addition to Sausage, Heat & Serve, Corned Beef, and Smoked.

NMCS Research All Rights Reserved Boneless Beef and Pork Grew Modestly Boneless Turkey (Excluding Ground) Declined Percent of Packages This analysis excludes Ground Meat and Poultry, Sausage, Offal, Ingredients, and Miscellaneous cuts, in addition to Sausage, Heat & Serve, Corned Beef, and Smoked.

NMCS Research All Rights Reserved Enhanced Packages Increased in 2010 Percent of Packages Enhanced was defined as Moisture Added Product with or without flavor. This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal..

NMCS Research All Rights Reserved Enhanced Profiles on Fresh Red Meats Were Similar to 2007 Percent of Packages Enhanced was defined as Moisture Added Product with or without flavor. This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal.

NMCS Research All Rights Reserved Turkey Increased Flavor Added Enhanced Product Decreased Enhanced Only Product for Each Species Percent of Packages Enhanced was defined as Moisture Added Product with or without flavor. This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal.

25 Chicken is Still the Leader in Heat & Serve, but Beef and Pork Gained Share Percent of Packages Package Count data was collected for Heat and Serve products in the meat case area in 2007 and 2010 only. Excludes Sausage Packages 2010 NMCS Research All Rights Reserved NMCS Research All Rights Reserved

26 Pork is the Leader in Value-Added Again Percent of Packages Excludes Sausage Packages. Includes Smoked Items (Chops, Drumsticks, etc.) comparable to the Value-Added Packages in 2004 Study NMCS Research All Rights Reserved

Country of Origin (COOL) by Country Within Species. Codes for Country of Origin included: A = USA (Only) B = USA and Other C = Other and USA D = Other For B and C: The first country listed refers to where the animal was born. The second code refers to where the animal was raised. Some Supermarkets had more than one code. Information was not recorded in several supermarkets as shown below NMCS Research All Rights Reserved 27 % of Supermarkets without COOL informatio n BeefChickenGround BeefLambPorkVeal 8%15%9%8%12%11%

Ground Beef Had the Largest Percent of Bilingual Packages Percent of Packages 2010 NMCS Research All Rights Reserved Was the First Year to Gather this Data

Production Claims Were Led by Minimally Processed and Hormone Free Percent of Packages Production Claims Beef Ground BeefPorkChickenTurkeyVealLambTotal Minimally Processed 2.6%21.5%11.8%57.1%45.1%25.5%33.5%27.2% Hormone Free 2.8%5.7%2.7%42.6%7.3%5.0%6.6%15.5% Antibotic Free 2.8%5.8%0.7%8.3%1.9%1.4%5.0%4.7% Vegetarian Fed 2.4%2.7%0.8%8.4%1.3%1.4%4.0%3.9% Never Ever 0.8%1.8%0.6%2.1%0.5%3.5%3.1%1.4% Free Range 0.0% 1.3%0.7%0.0%2.2%0.5% Animal Welfare 0.4%0.3%0.0%0.6%0.1%1.4%0.3%0.4% Grass Fed 0.5% 0.0% 0.2% Antibiotic Residue Free 0.0% 0.1%0.0% 2010 NMCS Research All Rights Reserved Was the First Year to Gather this Data

NMCS Research All Rights Reserved Nutritional Labeling on Package Expanded Again in 2010 Percent of Packages This analysis excludes Sausage, Heat & Serve, Smoked Offal, and Corned Beef.

NMCS Research All Rights Reserved Nutritional Labeling on Package Expanded in Each Major Species Percent of Packages This analysis excludes Sausage, Heat & Serve, Smoked Offal, and Corned Beef.

NMCS Research All Rights Reserved Nutritional Labeling on Package Expanded in Each Species Percent of Packages This analysis excludes Sausage, Heat & Serve, Smoked Offal, and Corned Beef.

NMCS Research All Rights Reserved Cooking Information on the Package Increased in 2010 Percent of Packages This analysis excludes Sausage, Heat & Serve, Smoked Offal, and Corned Beef.

NMCS Research All Rights Reserved Cooking Information Increased Beef, Ground Beef and Pork Percent of Packages This analysis excludes Sausage, Heat & Serve, Smoked Offal, and Corned Beef.

NMCS Research All Rights Reserved Cooking Information Increased in Chicken, Turkey and Lamb Percent of Packages This analysis excludes Sausage, Heat & Serve, Smoked Offal, and Corned Beef.

NMCS Research All Rights Reserved Natural Meat Products Grew in 2010 Organic Meat Products Still Small Percent of Packages Natural: If the word “Natural” used on the package. Organic: If package had an Organic seal. This analysis excludes Sausage, Heat & Serve, Smoked Offal, and Corned Beef.

NMCS Research All Rights Reserved Natural Products Saw Significant Gains in Beef, Ground Beef and Pork Percent of Packages Based on Natural Claim on Packaging. This analysis excludes Sausage, Heat & Serve, Smoked Offal, and Corned Beef.

NMCS Research All Rights Reserved Turkey, Lamb, and Veal Had Large Increases in Natural Product Packages Percent of Packages Based on Natural Claim on Packaging. This analysis excludes Sausage, Heat & Serve, Smoked Offal, and Corned Beef.

NMCS Research All Rights Reserved Organic Product Was Still a Small Percentage of the Case Percent of Packages Chart includes Only Packages with Organic Seal. Other includes Buffalo and Bison. This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal.

NMCS Research All Rights Reserved Store Branding Gained Significantly in 2010 Percent of Packages This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal.

NMCS Research All Rights Reserved Beef, Ground Beef and Pork Increased Store Branding in 2010 Percent of Packages This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal.

NMCS Research All Rights Reserved Chicken and Turkey Store Brands Gained Against Supplier Brands Percent of Packages This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked.

43 Exact Weight Percent of Packages 2004 is the baseline data set NMCS Research All Rights Reserved

44 Case Ready Increased for the Total Fresh Meat Case Percent of Packages This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal NMCS Research All Rights Reserved

45 Case Ready Increased Again in Beef, Ground Beef and Pork Percent of Packages This analysis excludes Sausage, Heat &Serve, Corned Beef, and Smoked Offal NMCS Research All Rights Reserved

46 Poultry Case Ready Share Was Consistent with 2004 and 2007 Studies Percent of Packages This analysis excludes Sausage, Heat &Serve, Corned Beef, and Smoked Offal NMCS Research All Rights Reserved

Consistency for In-Stock Position in Case Ready, but Not Store Wrapped, Packaging Percent of SKUs In-Stock is 5 or more packages per SKU displayed. This analysis excludes Sausage, Heat & Serve, Corned Beef, and Smoked Offal NMCS Research All Rights Reserved 59

48 PVC, Vacuum and Chub Packaging Have Gained Share Overall Percent of Packages 2010 NMCS Research, All Rights Reserved

49 Black, Pink Trays and No Tray Made Gains in Overall Share Percent of Packages 2010 NMCS Research All Rights Reserved

50 Rigid Trays Lost Share to Foam Trays and No Tray Packages in 2010 Deep Foam Was Recorded in 2007 and 2010 Only Percent of Packages 2010 NMCS Research, All Rights Reserved

Thank You for Your Time. Questions & Follow Up Research Supplier Audit Team 2010 NMCS Research All Rights Reserved

National Meat Case Study™ Copyright Information All rights reserved. No part of this research may reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of authorized Cryovac / Sealed Air Corporation personnel, in cooperation with partners; the Beef Checkoff, and the National Pork Board. P.O. Box 464, Duncan, S.C NMCS Research All Rights Reserved 12/2/10