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JOHN C. PIERCE
The Federal Grading System
for Animal Products
This chapter will deal with what the market grading system for animal
products is supposed to do, how well it performs its function, and the
possible role of grades in changing the fat composition of animal
products. Within the red-meat category, active grading programs exist
for veal, calf, beef, lamb, and mutton. Virtually no pork is federally
graded. Primary emphasis will be on beef, since it constitutes about
98% of the tonnage of grading performed. Also, the basic approach to
developing standards and carrying out the grading function can be
illustrated by beef.
The first consideration is the basic objective of the grading system.
The legislative authority for grading gives some insight into its function
in the marketing system for agricultural commodities. The most recent
applicable legislation relating to this function is the Agricultural Market-
ing Act of 1946, which authorizes and directs the Secretary of Agricul-
ture to develop and improve standards of quality, condition, quantity,
grade, and packaging and to recommend and demonstrate these stan-
dards to encourage uniformity and consistency in commercial practices.
It also authorizes and directs the Secretary to inspect, certify, and
identify the class, quality, quantity, and condition of agricultural
products and to collect such fees as may be necessary to cover the cost
of the service rendered to the end that agricultural products may be
marketed to the best advantage, that trading may be facilitated, and that
consumers may be able to obtain the quality of product they desire. The
Act provides further that a grading service shall be financially self
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JOHN C. PIERCE
supporting, that its use shall be voluntary, and that no one shall be
required to use such a grading service. Thus, the basic role of grading
is to expedite the marketing process.
Grading can be defined broadly as a method of classifying or group-
ing units of a commodity so that the variation in characteristics affecting
market acceptability and value is smaller within a grade than over the
entire range of the commodity. The number of grades for a particular
commodity generally differs with the range of variability to be measured.
The width of a grade should be sufficiently broad to contain a workable
or marketable supply and yet sufficiently narrow so that the units within
are relatively interchangeable in the marketing process.
A brief background on the evolution of beef grading may serve to
illustrate its basic purpose. In our present era of consumerism, one
might assume that beef grading was instituted at the request of con-
sumers or others directly involved in the buying and selling of beef,
such as retailers or meatpackers. However, the U.S. Department of
Agriculture was urged to begin a federal grading program for beef by a
group of some 250 producers, known as the Better Beef Association,
who felt that grade identification would increase consumer confidence in
beef, stimulate increased sales of preferred grades, and indirectly en-
courage the production of improved beef cattle. In effect, they were
looking for a system that would reflect consumer preferences back
through the marketing channels to the producer and serve as a guide in
his production plans and actions.
Beef grades are not based on nutritive values or specific fat levels.
More likely, consumers purchase beef and other meat products pri-
marily because of their palatability because they like them.
Market value differences in beef are associated with the palatability
of the lean and with the proportion of the carcass weight that the lean
represents. To reflect these two considerations, we nave two kinds of
grades for beef: quality grades and yield grades. The quality grades
identify beef for differences in palatability-tenderness, juiciness, and
flavor. Eight grades are used to identify the quality range of beef
marketed-Prime, Choice, Good, Standard, Commercial, Utility, Cutter,
and Canner.
The available research on beef palatability indicates that marbling
(the flecks of fat within the lean) and maturity (roughly the age of the
animal at time of slaughter) are the two most important factors affecting
beef palatability that can be used in grading. This research indicates
that increasing maturity, from young to old, adversely affects overall
palatability; additional marbling is associated with improved palat-
ability.
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The Federal Grading System for Animal Products
185
The yield grades, numbered 1 through 5, identify beef carcasses and
cuts on a quantitative basis. They measure differences in the yield of
trimmed retail cuts from the carcass, regardless of its quality grade.
These variations are predicted by using measures of fatness and
muscling. Although the yield grades have significant effects upon carcass
value, these differences are important primarily in trading between the
producer, the meatpacker, and the retailer. The identification does not
carry through to the consumer-buyer, as do quality grades, because the
consumer normally purchases trimmed, ready-to-cook cuts.
How well do the beef grades serve their purpose? How accurately do
they measure differences in eating quality and differences in the yield of
salable meat from a carcass? The principal criteria used in the quality
grades, as already mentioned, are marbling and maturity. Differences
in eating quality in beef are very pronounced. However, the identifica-
tion of factors affecting tenderness, juiciness, flavor, and overall palat-
ability has proved to be difficult. Marbling and maturity have con-
sistently proved to be the two most useful characteristics, but additional
indices are needed to more accurately account for the variability in
eating quality. Since cattle coming to market vary greatly in genetic
makeup, feeding, and management, it is not surprising that character-
istics that can be quickly and subjectively evaluated in a grading pro-
gram have not provided as precise a measure of eating quality as would
be desired. Accordingly, there is an overlap in the eating quality of the
various grades, but also a pronounced trend for higher palatability
ratings in the higher grades. Hopefully, research will eventually identify
other characteristics that may be useful in a grading program for pre-
dicting eating quality.
Yield grades are based on the research results of Murphey et al.
(1960), which indicate that about 80% of the variability in cutting
yields can be explained by the criteria used in the grading system. The
practical usefulness of yield grades for identifying differences in cut-
ability is enhanced by the fact that most of the factors used to determine
yield grades can be readily measured by objective means to substantiate
the accuracy of their application.
Grading merely provides product identification. The importance of
the characteristics being identified and the effectiveness of that identifica-
tion in expediting the marketing process are measured to an extent by
trade usage. Meat grading is a voluntary service and is supported by
The fees charged the users. Consequently, meatpackers and other users
pay to have beef graded only when they can sell it to better advantage
with a grade stamp than without one. Beef grading has grown sub-
stantially since about 1950. This, of course, has been paralleled by a
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JOHN C. PIERCE
period of greatly increased beef production, particularly fed beef. An
increasing proportion of beef produced since 1950 has qualified for the
Prime and Choice grades. Per capita beef consumption has doubled
since 1951, and the volume of beef graded has increased more than
fivefold. We estimate that 80%-85% of the fresh beef cuts sold at
retail are federally graded. The volume of Choice beef steadily increased
in recent years and became the dominant grade; about 6% of the beef
quality graded has been Prime, 80% Choice, and 12% Good. Lower-
quality beef is primarily used in processing or manufacturing, and very
little of it is graded.
Beef grades have made their most important contribution in establish-
ing essentially a national market for beef. They serve as a common
denominator for transmitting signals about demand, which makes
possible more precise production planning. The grademark also serves
as a basic guide for consumers in selecting beef, but it should be pointed
out that many consumers are still unfamiliar with the grade terminology.
Yet, through retailer reliance on them, grades play an important role in
satisfying consumer demand for a consistent, uniform quality of meat.
Consumers tend to purchase beef in a store that supplies a consistent
quality at competitive prices. The ability of retailers to buy graded beef
nationwide without the necessity of personal selection not only reduces
a direct marketing cost but also contributes to making the market for
beef national in scope. Federal grading opens sales outlets to packers on
a national basis virtually from the day a plant begins production. This,
in turn, provides additional competition for the producer's cattle from
new, as well as old, and from small, as well as large, packers. Thus,
beef grading has proved to be workable and useful in expediting the
marketing process.
What about reducing the fat content of our meat? Fortunately, not all
consumers prefer beef of the same composition. It is rather clear,
however, that consumers generally have shown an increasing aversion
to excess fat on meat for several years. The production of excess fat has
made it necessary for retailers to trim larger and larger quantities of fat
from meat cuts in order to satisfy discriminating buyers. For 1973, it
was estimated that the cost of producing, shipping, and trimming the
excess fat on beef alone was more than $2 billion.
Most of the wide range in total fat composition of beef carcasses is
caused by trimmable fat, and much of it is removed in preparing retail
cuts. The yield grades provide a useful measure of this variable. For
example, the fat trimmings necessary to make closely trimmed retail
cuts vary from 7~/2% in Yield Grade 1 carcasses to 28% or more in
Yield Grade 5. Although differences in fat content of the lean are sub
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The Federal Grading System for Animal Products
187
stantial, they are of considerably less magnitude. The fat content of
different muscles varies and, as reported by Doty and Pierce (1961),
the fat content of different locations within the same muscle varies. The
studies of Garrett and Hinman (1971) indicate that most carcasses
graded low Choice and Good typically contain less than 5% fat in the
large, trimmed, uncooked muscles from the rib, loin, and round. Un-
published data of the Livestock Division, Agricultural Marketing Service,
U.S. Department of Agriculture, indicate that about two thirds of the
beef qualifying for the Choice grade would be classified as low Choice.
The fat composition of beef can be reduced in many ways. Fat both
external and intramuscular-is considered to be the result of high-
energy rations. The economic situation in recent months has drastically
changed the meet: "rain price ratio. If these conditions continue for an
extended period, they undoubtedly will influence the fat content of beef.
To date, they seem to have had little effect on the total fat content of
beef, although there has been some reduction in the proportion of
the supply that qualifies for the Prime and Choice grades.
Reducing the fat content of beef by changing breeding stock has
considerable potential. Many carcasses in coolers qualifying for the
Prime and Choice grades that have only a thin, external fat covering
are thickly muscled and require little trimming in making retail cuts.
On the other hand, there are Good and Standard grade carcasses with
an inch or more of outside fat that must be trimmed to make acceptable
cuts. Therefore, there is a broad opportunity to select cattle with the
genetic ability to produce thickly muscled carcasses with little excess fat
but with the marbling and other characteristics associated with tender,
juicy, flavorful beef. Accurate market identification of these character-
istics in both cattle and beef and equitable price incentives for producing
meatier cattle would speed the improvement of cattle. Such identification
would bring more sharply into focus the wide differences in fatness and
muscling in beef supply. To assist in cattle-improvement efforts, the
USDA provides a beef-carcass data service that makes it relatively easy
for breeders and feeders to get detailed carcass information on the
cattle they produce.
The potential use of grades particularly nonmandatory grades-
to arbitrarily reduce the fat content of beef has very practical limitations.
Since the grades are voluntary, the extent of their use would vary with
their precision in providing the identification that is important to those
using grades in the marketing and merchandising of beef. Pronounced
consumer preference for lower fat composition of beef would likely
evoke an equally pronounced effort of cattlemen to produce more of
this type of beef particularly under present conditions with relatively
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JOHN C. PIERCE
high feeding cost. Thus, a change in the grade standards would be
logical if a pronounced change in consumer preferences or a general
change in the type of beef marketed was evident. However, a drastic
change in fat content of the various USDA grades appears unlikely in the
short range. A USDA proposal is under consideration that would ac-
complish slight reductions in the average fatness of the Prime and
Choice grades. Comments on the proposal from both consumers and
those selling meat directly to consumers appear to be predominantly
in opposition to the change.
In the longer range, economic and nutritional considerations can,
and likely will, lead to a reduction in the overall fat content of our
beef. Grades can help in this transition by filling their traditional role
of providing useful market identifications. But they are not likely to
exercise a direct effect and lead the way to reduced fat levels. Rather,
the identification that grades provide makes it easier for other market
forces to produce the change.
REFERENCES
Agricultural Marketing Act of 1946. 7 U.S.C. 1621-1627.
Doty, D. M., and John C. Pierce. 1961. Beef Muscle Characteristics as Related
to Carcass Grade, Carcass Weight, and Degree of Aging. USDA Tech. Bull. No.
1231.
Garrett, W. N., and N. Hinman. 1971. The fat content of trimmed beef muscles
as influenced by actuality grade, yield grade, marbling score and sex. J. Anim.
Sci. 33:948.
Murphey, C. E., D. K. Hallett, W. E. Tyler, and J. C. Pierce, Jr. 1960. Estimating
yields of retail cuts from beef carcasses. J. Anim. Sci. 19:1240. (A)
Representative terms from entire chapter:
yield grades