Evaluating the economic impact of MSA

Summary

Meat and Livestock Australia and the Cooperative Research Centre for Cattle and Meat Quality funded a major R&D program in the mid 1990s to investigate the relationships between observable beef and cattle characteristics, cooking methods and consumer appreciation of beef palatability.  Out of this R&D program grew the Meat Standards Australia Australia (MSA) voluntary meat grading system which was aimed primarily at providing an accurate prediction of beef eating quality for the domestic market.  The MSA system commenced operations in 1999/2000. The gross benefits associated with using the MSA system was quantified by using data on the number of carcases graded, a survey of retailers and wholesalers based on prices for MSA graded beef (3 star or better) versus ungraded beef, and market reports of prices paid for MSA quality cattle versus non-MSA quality cattle.
Over the period 2004/05 to 2010/11, beef consumers across Australia were prepared to pay on average $0.30/kg extra for MSA branded beef on a carcass weight equivalent basis to guarantee tenderness. This beef is primarily sold through independent butcher shops. These retailers kept about $0.06/kg and paid their wholesale suppliers the remaining $0.24/kg to source MSA compliant cattle and MSA graded carcasses. About $0.15/kg was passed back to cattle producers on average.
​The cumulative retail-level economic benefit of the MSA system to 2010/11 is estimated to be around $503 million, with a current annual benefit of around $77 million.