Issue No. 36
1. Avian Influenza
2. Breeder Valuation
3. Pricing Ostrich Meat
4. Ostrich Meat Grading
5. Developing WOA Logo for Marketing
6. Contributions
H5N1 Avian Influenza continues to be making the news as new outbreaks continue to be spread in the wild bird population. Many of you may have heard reference to Ostrich being slaughtered in Nigeria. These ostrich were on a very large poultry farm, that it is believed introduced the infection through importation of day old poultry chicks on a regular basis, over a number of years, from China. The ostriches were not confirmed as infected, they were culled as part of a mass control culling procedure.
We remind all our members to be vigilant and follow strict biosecurity measures as outlined on our web site. http://www.world-ostrich.org/avianinf.htm. We also remind our members of the need to liaise closely with your own government veterinary department. Please communicate your local situation or concerns with us either through the list at [email protected] or [email protected] if you would like the message to be private. Please encourage as many people involved in ostrich as possible to join the WOA to enable the WOA to be an effective means of communication and support throughout our industry. This is especially important while this Avian Influenza virus is active and this is new ground even for the established poultry industries.
A reminder of the information on vaccinations provided by our Vet – Dr. Alan Benyon:
Quote: There are three companies producing vaccines being Intervet, Merial and Fort Dodge. The most used vaccines are inactivated i.e. dead virus and are in an oil based medium so must be injected into the bird and this need two injections two weeks apart. They take three weeks to protect the bird completely but a lot of protection is available in around one week. The vaccine is relatively cheap to use but any EU Country must apply to the EU for authorisation and this is done by the Government vets
We do not know how AI works in Ostriches and we do not understand how effective the vaccine is in Ostriches but I do know it has been used in South Africa and I have contacted a vet there to find out more. In any case in all other species the vaccine will offer protection to the bird and will reduce shedding of virus so will be a good thing to do. What we do not know is to what level this protection and reduction in shedding will be.
Many companies are using vaccine all over the world and are setting up monitoring to assess the effectiveness. If a Government will use vaccine such as in Italy we ought to encourage your members to contract myself or the vaccine Company and we can take bloods to get more information. There is a massive amount of work being done in many areas of AI but there are not enough people looking at it and there are more cases all the time!
The vaccine covers H5 and this will protect against all H5 viruses irrespective of the N component. Many vaccines are bivalent and hold H5 and H7 subtypes and this works well to cover all your options. End quote
Last week saw the first outbreak of H5N1 in farmed poultry in Europe. The outbreak was in a turkey farm in France in the same area that the infected wild Swans had been found. France is culling and using the Intervet H5H7H9 vaccine.
The latest EU directive has given a special dispensation to rare and exotic birds that have exceptional genetic material to be vaccinated. Ostrich may qualify under this directive and the European industry needs to apply as quickly as possible to their individual governments to have them accepted. Individual European producers are advised to request supplies of the vaccine from their respective government veterinary departments.
Note: Members operating in European Union countries need to observe European directives and also communicate directly with their local veterinary departments as each member country will have its own regulations as well.
2. Breeder Valuation
We have been asked by a member for our thoughts on how to value Ostrich breeders. One reason this becomes important is when compulsory culling becomes essential and governments are required to pay compensation. Governments are therefore seeking guidelines on how to value breeders. It is also an extremely important subject when purchasing new breeders and establishing a commercial price.
In order to accurately value a production breeder it is essential to have production records. A report entitled “Determining Poultry Indemnity Values: Examples and Lessons Learned from Poultry Disease Outbreaks in Canada and the United States” [1], published jointly by the USDA and Agriculture and Agri-Food Canada, discusses the issues related to valuing poultry for compensation during a recent Avian Influenza outbreak in the United States and Canada (not H5N1). In this report reference is made to a cull that took place in the Fraser Valley in British Colombia and the problems of valuing these specialty birds, which included Ostrich.
Quote: “The breeder birds were valued similarly to the breeding chickens and turkeys, except the value of these birds are much greater than is allowed under the Health of Animals Act. The meant that the majority of breeder specialty birds were not compensated for at their full market value, but were capped at the maximum value allowed under the act.” End quote
Another aspect to bear in mind with Ostrich is the difference in Ostrich breeder production period by comparison to poultry. Ostrich breeders can be productive for up to 10 years and many reported productive for longer. By comparison a chicken layer has a laying period of around 60 weeks.
Avian Influenza is a real threat and I am sure all our members will agree that we need to put our industry onto a proper commercial footing as quickly as we can. Maintaining good records is an essential part of developing methods of valuing livestock – both meat animals and breeder stock. Also required to value livestock accurately is a strong commercial environment where producers are making fair profits. To date our industry has been achieving substandard production figures that have left most producers uneconomic.
The only method currently used for valuing Ostrich is the “WPWP” system (“What People are Willing to Pay”). Anyone who has owned ostrich in a country after their breeder market has collapsed will have experienced prices that were several thousand dollars or even 10s of thousands of Dollars and finally having difficulty giving their birds away.
Your directors will develop some guidelines. Their recommendation for now is to put in place systems that reverse the causes of current poor production, support the WOMRAD [2] initiative to work collaboratively to develop markets and establish good records. Then should your operation be in the unfortunate situation of compulsory cull for whatever reason, there is a fair basis for valuing your livestock.
Most importantly there is a fair method to evaluate the purchase price of breeder stock when buying and selling. This is good for both the buyer and the seller. The seller of excellent proven stock can achieve a fair price and the buyer can have a mechanism to establish a fair value that will yield a positive return on investment – provided of course the correct management systems are utilised.
3. Pricing Ostrich Meat
How to price the meat has long been an issue for discussion and a situation aggravated by low volume, fragmented production selling to the same markets and inexperience - the inexperience of new producers and processors as well as buyers.
There are a number of factors that influence price and these include such things as:
- Volume – economies of scale
- Cut (e.g. muscle degree of tenderness, size, usability)
- Degree of preparation (e.g. whole muscle demembraned, muscles portioned to individual steaks)
- Quality/Grade
- Age
- Market (eg. wholesale, retail, restaurant)
Why is grading meat important as a mechanism to support meat pricing and marketing initiatives? A web search on meat grading comes up with some useful clues as to why it is an extremely important marketing tool, especially when there is significant variability of product as is currently the case with Ostrich. Any one with the opportunity to stand on an Ostrich slaughter line has seen the very significant variations from producer to producer.
One benefit of marketing under different grades is that the customer can differentiate between one supply and another and will have a better idea of what to expect, provided all participants have systems in place that grade their meat accurately. Different grades carry different price structures. Therefore working to produce high grade product, graded to recognised and agreed standards, is one method to achieve product differentiation in the market place and benefit from higher prices.
The WOA has created a grading system [3]. A maximum age of 16 months has been applied to Prime Grade. Individual companies can set their own standards even higher and produce birds slaughtered in less than 300 days, producing a very tender meat. In time this may become an industry standard to achieve Prime Grade. For grading to be an effective marketing and pricing tool in a developing market place, such as ostrich at this time, it requires a large percentage of producers to be operating to these standards. This is particularly important while in excess of 60% of world's production remains supplied by a single source.
4. Ostrich Meat Grading
Many of our members have not attended conferences or training courses where the Grading system has been explained. To develop a better understanding, this section will discuss the main points of the system and their relevance:
There are 5 Grades: Prime, Choice, Select, Utility and Non-Food
Prime, Choice and Select Grade:
Prime grade is the best quality meat and will carry the highest market value.
Choice grade is a young cull breeder or bird held too long before slaughter. Some muscles will be less tender and lower value than Prime
Select is a cull breeder of any age over 24 months. Provided the breeder has been fed a good diet all her/his life - the meat will still be good tasting and a good colour. It will be tougher and therefore carry a lower price than Prime or Choice
To qualify for the relevant Grade a bird must satisfy every definition. The only difference with Prime, Choice and Select is bird age all other definitions are the same:
Bird Age - Prime
Definition: Less than 16 months.
Comment: As referenced above individual companies may choose to improve on this and only allow birds up to 300 days as their top grade to give additional competitive advantage. Perhaps this can be called Prime Plus?
Bird Age - Choice
Definition: 16 to 24 months of age
Comment: This category picks up birds that were not slaughtered prior to 16 months but still young enough to have some quality tender muscles
Bird Age - Select
Definition: 25 months of age and older
Comment: This will be all cull breeders that have been well raised and meet all the other criteria laid down for this category
Fat Pan Colour:
Definition: White Fat Pan Colour only
Comment: Birds can produce fat from Pure White to very deep yellow colour. Fat colour is a key indicator to bird health. When yellow fat is present, very often other negative factors can be seen on the bird that will influence the overall taste and appearance of the meat. The picture below is the Japanese Beef Grading and has been published as part of the marketing by a number of companies producing Beef as part of their marketing program. This web site is one such company: http://www.blackgoldfarms.com.au/grading.html Note how they not only discuss fat marbling they also have this colour chart for Fat Colour and Meat Colour - Figure 1. Ostrich fat is often seen very much more yellow that the lowest score given in this example. In this example of the Japanese Beef Grading system the higher the grade the more desirable the meat and the fat and colour chart, the lower the score the more desirable. The more desirable attributes will achieve the highest price.
Ideally an Ostrich slaughter bird should carry a fat pan of approximately 32-35mm thick. Too little fat is also a sign of malnutrition that can lead to variable tasting and poorly textured meat.
Figure 1 – Japanese Beef Grading
Muscle Colour:
Definition: Even red muscle colour throughout
Comment: Variable colour within the same muscle is a nutritional inadequacy and therefore controllable. The most common known variable colouration in single muscles is White Muscle Disease. If you ever see muscles of differing colour or some very pale or white muscle - corrective action needs to be taken. Apart from the affect on bird health and therefore economic performance, consumers are influenced by the colour and appearance of meat.[4] Muscle with the appearance of the Ostrich muscles in Figure 2 are not attractive to the consumer and commonly seen in our industry at this time. During one presentation an ostrich meat processor informed me that meat looking like this photograph was all he ever saw, he believed it to be normal. Meat from birds producing one or more muscles such as figure 2 will not qualify for Prime, Choice or Select Grade.
Figure 2 – Multi-Coloured Muscles
Heart Condition:
Definition: Heart of normal size, colour and texture, with no damage
Comment: A small heart, a heart surrounded by yellow fat, a heart that is a poor texture are all key indicators to malnutrition and it is commonly seen in ostrich today.
Liver Condition:
Definition: Mid-brown colour with no abscess/ulcerations
Comment: Many, if not all, slaughter plants that have slaughtered ostrich will be able to report extremely variable liver conditions - more variable than is commonly seen in mainstream livestock specie. When any abnormality of the liver is seen, the bird must be downgraded. The liver is a blood filtering organ and when the liver is not functioning to the optimum, there will be odd tastes in the meat.
Disease Condition:
Definition: No disease symptoms or evidence
Comment: This bird will be downgraded to Non-Food
Other Condition:
Definition: No Oedema or "jell" substance on heart, thigh or sternum
Comment: These conditions are also symptoms of mal-nutrition. When mal-nutrition is present the meat will usually be more variable in colour, taste and texture.
Utility Grade:
A Utility grade bird will be any bird that does not meet the standards set out for Prime, Choice or Select grade, but is fit to eat. The meat will be inconsistent in taste, colour and texture and this grade is to be discouraged for retail sales while our industry is working to establish a place in the market and achieve good prices. Utility grade meat should only be used for further processing into value added products. The following are the definitions for Utility Grade. A bird will be Utility grade if it has any one of the conditions referenced:
Bird Age:
Definition: Any age of bird
Comment: When a bird has any of the conditions defined below, the meat is likely to be variable in flavour and less attractive to market due to darker meat colour.
Fat Pan Colour:
Definition: Yellow Fat Pan colour
Comment: As referenced above, fat of a more yellow colour is a key indicator to the overall health of a bird. Yellow fat also has a poor aroma that is indicative of the impurities in the fat. Although Ostrich meat is sold free of fat, the presence of yellow fat on the carcass is an indicator of variable tasting meat of variable degree of tenderness.
Muscle Colour:
Definition: Multi-colouring of muscles (pink to dark red)
White colour areas in some muscle
Comment: Multi-colouring is not attractive to the consumer and the meat will be variable in taste.
Heart Condition:
Definition: Small, damaged or spongy texture hearts
Comment: A poor heart will be caused either by mal-nutrition or disease.
Liver Condition:
Definition:
Yellow, Green or Black Colour
Liver abscesses or ulcerations
Comment: All above definitions are key indicators to liver damage of some degree. Livers unable to function adequately are unable to filter the blood adequate and may result in toxins and/or heavy metals remaining in the muscle and/or fat. Depending on the severity of the damage, these conditions can result in off tasting meat and meat with a poor aroma.
Disease Condition:
Definition: No disease symptoms or evidence
Comment: Disease can result in infection in the birds that may cross contaminate good meat and/or infection may be passed onto the consumer if the meat is not handled correctly.
Other Condition:
Definition: Oedema or "jell" substance on heart, thigh or sternum
Comment: These conditions are also symptoms of mal-nutrition. When mal-nutrition is present the meat will usually be more variable in colour, taste and texture.
Non-Food Grade:
Non-Food is a polite way to say condemned carcasses that are not fit for human consumption. A condemned bird will display one or more of the following conditions.
Bird Age:
Definition: Any Age of Bird
Muscle Colour:
Definition:
Muscles with abscesses or channels in meat
Muscles with light or dark spots
Liver Condition:
Definition: Spotty or infected livers
Disease Condition:
Definition: Any disease symptoms or evidence
The greater the number of members who utilise the grading system as part of their marketing program the greater the opportunities for all to benefit. Clearly a membership fee of $100/annum cannot provide the funding required developing this, but through communication the membership can come up with a plan.
5. Developing WOA Logo for Marketing
Taking the above discussion a step further, last month we reported that a member is using the WOA logo on their product packaging, but without seeking permission. The member clearly sees that as a benefit to their marketing. Working together to establish systems and protocols that ensures the right standards are followed, we can all make the WOA logo a meaningful quality mark - but to establish that value does require an investment in the infrastructure required to ensure all standards are strictly adhered to.
Are there other members who would like to pursue this approach to support them in their marketing approach? If so, can we invite you to take the discussion to the member's list.
6. Contributions
As always we ask for contributions. Communication is particularly important at this time while H5N1 Avian Influenza is spreading and Ostrich producers are asking for information. The WOA offers channels of communication for all participants to enable our fledgling industry to share experiences and develop strategies.
[1] - http://agecon.lib.umn.edu/cgi-bin/pdf_view.pl?paperid=16682&ftype=.pdf
[2] - Newsletter No. 22: http://www.world-ostrich.org/member/news22.htm
[3] - World Ostrich Association Ostrich Meat Grading can be downloaded from: http://www.world-ostrich.org/woacarcass.pdf
[4] - See Item 4 Newsletter No. 22: http://www.world-ostrich.org/member/news22.htm
Any comments or suggestions, please post either to the members list [email protected] or Craig at [email protected]
Ask not only what the WOA can do for you but also what you can do for the WOA.
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