Saturday, June 16, 2012

Coop Farmer-owned USDA slaughterhouse

Note and disclaimer:  I went to this organizational meeting,and here's the writeup.  This writeup is solely my opinion, based on the notes I took at the meeting and the materials they presented at the meeting, and may or may not reflect the views of North Cascade meats; if you'd like to contact them directly you can do so at  I have no connection of any sort with them other than as an interested meat producer. 

Update:  They've posted a video of the meeting on youtube.  You'll find it here

North Cascades meats the name of a group of meat producers in the north part of the state that wants to start their own USDA slaughterhouse to process their beef, pork and lambs.

 The meeting itself was done in an auditorium, and a slide presentation was done by the board of the proposed group.  The audience was a mix of farmers and meat retailers, with a few consumers here and there.  I'd guess that around 100 people attended.

Background information:  
There are three ways for an animal to get to your table in Washington State right now:

1) You own the animal and process it yourself
2) You contract with a custom slaughter/farm kill guy, and then send it to a meat shop for cut-and-wrap
3) the meat is slaughtered at a USDA plant and cut-and-wrapped at an inspected facility*

if you choose option 1, you can't legally sell or give away the meat.
If you choose option 2, as a farmer, you can sell a whole or half animal (or a quarter, with beef) to someone, but nothing less than that, and you cannot sell individual cuts, but you cannot do any value-added with the meat.  (sausage, bacon, ready-to-eat, etc)
If you choose option 3, you can sell individual cuts and have the possibility of doing value-added products.  

What this coop would like to do is make option 3 easier for small producers, allow the small producer to realize a better price from their production, and ensure that the ability to bring animals to market won't be cut off** at some point in the future, and to provide an outlet for the entire production  by cooperatively pooling. 

The meeting
It seemed like these guys are doing two separate things.

  The first thing that they'd like to do is start their own slaughterhouse to ensure their ability to reach their markets, and to have the cost of that slaughter be as reasonable as it could be.

  The second is to establish a brand name and produce that can be used to increase the value of the products that they sell.

Both of these goals are good, and both are doable, but the meeting suffered a bit because there was some confusion on the audiences; I know that it wasn't clear to me what was being proposed until the meeting was pretty much over and I talked directly to a couple of the board members.

Rancher concerns
The audience was a mixed bag of producers.  I'd say that the cattle guys were probably the largest group, and I think the most vocal, too, and had the hardest time with the branding aspect of this proposal.  The proposed brand that they'd like to have for their beef is for a grass-fed beef market; which raised many concerns from the audience about the standards that would be maintained.  How much grain could be fed?  (simple answer:  None)  Is corn silage considered grain?  What if I train my cows to be led around with a bucket of feed for ease of handling -- does that disqualify me?   What am I allowed to feed my cows in the winter?  Do I really have to finish cows in January?  There were lots of questions like this.  

My opinion is that they could have made this much simpler by presenting it like this:

"We propose to pay $xxxx per cow that meets our specs.  If you'd like to get that price, here are our specs.  If your cows don't meet them for some reason, that's fine, we'll still process your cows and you can still be a member, you just can't sell under the brand name.  We may establish many brand names in the future, but we're going to start with grass fed initially.  "

What having a brand does for the ranchers long-term is it provides a consistent supply for larger customers.  If I produce 10 cows that' won't keep a steakhouse busy for more than a month; so we need 11 other producers to cover the other months.

In addition, there is a need to be able to sell the non-steak portions of the cow, and to provide a consistent supply meat to our larger customers -- year-round supply.  

It sounded like, from the Q&A, that there would be several ranchers who would have to change the operations in order to supply the coop.

Pig and Lamb producer concerns
There appeared to be no general agreement on what could be fed to pigs and qualify for the north cascades brand; some people said no commercial grains; others said pasture access was key; other people talked about husbandry standards.  I did not come away from this meeting with the feeling that I understood what it would take to have my pigs conform to their brand standard.  I don't feed the majority of my pigs commercial grains, but I do from time to time buy feed.  And if you've read this blog you know that I'm skeptical about anyone who claims to raise pigs on pasture alone.

I'll be interested in seeing what happens with this proposal.   

 A local steakhouse owner got up and talked about how he really liked the idea of a local beef coop, and that the brand would sell well, as did the general manager of a local food coop, who sells $3 million in meat a year and has 13,000 members.  There is clearly a market for a local brand.

*Inspected facility:  You can produce value-added products in either a county-inspected facility such as a restaurant or commercial kitchen or farm kitchen,  or a USDA inspected meat-packing facility.  If you are producing these items in a county-inspected facility you can only sell the products on your premises.  If you're in a USDA inspected facility you can sell across state lines or retail.  

**Cut off:  Small-scale USDA slaughter is not a very profitable business; it's not very sexy, and it's not got a high enough margin to attract people who aren't in the industry to it.  As a result there's very little new investment in capacity, and when one of these slaughterhouses come up for sale it's often very difficult to sell them.  Some of them never get sold; the equipment is auctioned and the plant closes down.  When they do get sold, it's often to people who use them to provide only their own production, and as a result it reduces capacity even further.

1 comment:

Frank said...

Thanks so much for the update! Sounds like a good initiative, with quite a few issues to sort out.

If they slaughter small quantities for third parties with reasonable prices it's something that will help all kinds of producers that sell directly to market.

I am not sure how useful the own brand will be for small producers; though the fact that there's definitive interest from local parties seems rather positive.