Tuesday, November 30, 2021

Unhappy with prices, ranchers are building their own meat processing plants.

DE MOINE, Iowa. Like other ranchers across the country, Rusty Kemp grumbled for years about the minimum prices he paid for the livestock he raised in central Nebraska, even as the cost of beef in grocery stores continued to rise.

He and his neighbors blamed the consolidation of the meat industry back in the 1970s, which resulted in four companies slaughtering more than 80% of the country’s livestock, giving processors more power to set prices while ranchers struggled. make a living. Federal data show that for every dollar spent on food, the share of ranchers and farmers has fallen from 35 cents in the 1970s to 14 cents in recent times.

This prompted Kemp to pursue an ambitious plan: to raise more than $ 300 million from ranchers to build the plant on his own, leaving his future in his own hands.

“We’ve been complaining about this for 30 years,” Kemp said. “Probably, it’s time for someone to do something about it.”

Crews will get to work this fall, building a nearly 400-acre organic beef plant near North Platte, Nebraska, and other groups are taking similar unexpected moves in Iowa, Idaho and Wisconsin. Businesses will be testing whether it is indeed possible to financially compete with the industry trend that has swept American agriculture and played a role in meat shortages during the coronavirus pandemic.

The move is timely as the USDA is currently taking a number of steps to encourage a more diversified offer in the meat industry.

However, the challenge is hard to overestimate when faced with huge, well-funded competitors that operate high-efficiency factories and can sell beef at prices that smaller operators will struggle to match.

The question is whether smaller businesses can pay the ranchers more while still making a profit. The average 1370 pound steer costs about $ 1630, but that cost needs to be divided between the slaughterhouse, the batch of feed, and the rancher, who usually has the biggest costs of raising the animal for over a year.

David Briggs, CEO of Sustainable Beef, acknowledged the difficulties but said his company’s investors remain confident.

“Livestock people love risk and are willing to take risks,” Briggs said.

Nation World News Deskhttps://nationworldnews.com
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