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Romance vs. Reality: Hard Lessons Learned in a Grass-fed Beef Marketing Cooperative

HDRider

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Read the entire story at https://www.extension.iastate.edu/AGDM/ ... 5-220.html

A few snippets...

Editor’s Note: Tallgrass Prairie Producers Co-op
operated from 1995 to 2000, raising and marketing
grass-fed beef from ten Kansas ranches. It ceased
active operation in 2000. Below is the story of why
and how. While the cluster continues to explore ways
to work together, former business manager Annie
Wilson offers the following as their lessons learned
in the hopes that others will benefit from what
they’ve learned.

The purpose of this article is not to discourage other
producers from niche marketing, but to share our
experiences in our five years of marketing grassfed
beef. The variables in any business effort are so
endless that we cannot conclusively pronounce what
will or won’t work for others. Times change and
undoubtedly some of the production and marketing
realities we faced are different now. A new and different
formula may work today. We only know what
happened to us, and will try to communicate our
perspective here.

First we will give a general overview of our history,
followed by what we saw as the critical elements of
success, some of which we unfortunately lacked.

Business history
Tallgrass Beef is a product produced by ten ranch
families in a marketing cooperative called Tallgrass
Prairie Producers Co-op. Our original mission was
“to produce and market meat products from livestock
raised in a way to maximize conservation of
natural resources and minimize use of fossil fuels
and farm chemicals.” We decided to raise cattle that
spent their entire lives on the pasture, never in the
feedlot, avoiding the grain and feedlot production
model and producing a unique lean, grass-fed beef
product raised without hormones or sub-therapeutic
antibiotics.

Catch-22 or barriers
Barriers we encountered were numerous. Many
we were able to overcome through hard work and
determination. Others had become insurmountable
by the time we perceived them clearly, and we found
ourselves caught in a vicious cycle.

Our volume was too low to obtain processing of our
product at an economically viable, competitive rate
(our costs were triple those of other high volume
suppliers
). Yet even managing the volume of orders
we had was exhausting our members and employees.
We lacked adequate supply to access the markets we
needed to reach the volume we needed to obtain affordable
processing and transportation. Additionally,
we did not have the capital to acquire professional
management to guide our company in these directions.
 

uplandnut

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Interesting article, especially with the grass fed movement we all keep hearing about nowadays. This type of thing was just talked about at our local cattlemans meeting last month. We had a speaker come in and talk about how he runs his grass fed business. All sounds good but I still question the viability of it. Being pretty green to the cattle industry I wonder if there attempt was a little to early as I don't remember anyone really making a big issue out of grass fed beef 15 to 20 years ago?
 

HDRider

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There are a few that raise and process their own beef, which is a very expensive proposition.

Like - Patricia Whisnant, DVM - http://www.americangrassfedbeef.com/
Our cattle are finished on the highest quality forage available that is in a green growing state. This practice insures the best quality grass fed beef possible that is consistent in its clean beef flavor and tenderness.

Our cattle are harvested in our own processing facility under our direct supervision. This assures that each individual animal is treated humanely and without stress.Skilled butchers who take pride in their art of cutting beef

Our family is passionate about providing our customers with the healthiest, safest and highest quality beef on earth.




A list by state - http://www.americangrassfed.org/produce ... -by-state/
 

Ojp6

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I know one guy that sells some "grass fed" beef. He buys 8-900 lb heifers and finishes them on grass and markets it as grass fed. The problem being that he buys them at the sale barn and has no idea if they've been on a creep feeder half their lives. He just wants something he can turn over pretty fast
 

Stocker Steve

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Some people make it work. They seem to have marketing genetics in the family, and grass fed genetics in the pasture. Initially we tried using steers and they were under finished. Now we direct market a couple grass fed heifers each year but no one here is excited about going much farther. I believe WS still has a grass fed feeder sale. That may work better for some folks, rather than trying to manage the entire growing and finishing and processing and marketing thing.
We looked hard at supplying Thousand Hills a couple years ago. It did not pencil out for us at the time. I think it would look better during a commodity crash. One issue here is that there is a lot of GMO by products used for supplements. One could plant more annuals and feed better balage but that all costs.
Now the big dogs have jumped into this fight, and are using imported grass fed beef. Don't see how the small guy can compete with that, outside of focusing on a locally grown and good tasting niche.
 

mwj

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If you are going into a niche market competition will pick you off pretty quick.
 

HDRider

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mwj":1snb22nb said:
If you are going into a niche market competition will pick you off pretty quick.


Appears to me we are being picked off now...

****

Tyson Foods Springdale, Ark. - U.S. market share 25 percent

Cargill Meat Solutions Corp. Wichita, Kan. - U.S. market share 21 percent

JBS USA Greeley, Colo. - U.S. market share 18.5 percent

National Beef Packing Co., LLC Kansas City, Mo. - U.S. market share 10.5 percent

About 35 million cattle are slaughtered in the U.S. annually by 60 major beef-packing operations processing around 26 billion pounds of beef. Four firms control over 80 percent of all the beef slaughtered.

http://www.hcn.org/issues/43.5/cattleme ... tpackers-1
 

mwj

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HD I was talking about trying to split a small local niche market. One person could make money parting out 20 head a year. When 7or8 more jump in with 20 head apiece, the market will be a disaster and you will sell those ''premium'' cattle for a poor price.
 

HDRider

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mwj":1k842yyu said:
HD I was talking about trying to split a small local niche market. One person could make money parting out 20 head a year. When 7or8 more jump in with 20 head apiece, the market will be a disaster and you will sell those ''premium'' cattle for a poor price.
I see what your saying..

It is true now. But, why does it have to be that way? If you sold at retail price, competing with mainstream markets, then there should be plenty of room. Th reason that doesn't work is because processing cost is so expensive for the little guy. The economy of scale favors the monsters, and the cost to comply with government regs kills the little guy.
 

Turkeybird

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Heard on radio yesterday that 1/3 of the workforce in u.s. Processing plants were Hispanic workers. Trump will throw a monkey wrench in their lap
 

talltimber

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HDRider":2wtlh2ng said:
There are a few that raise and process their own beef, which is a very expensive proposition.

Like - Patricia Whisnant, DVM - http://www.americangrassfedbeef.com/
Our cattle are finished on the highest quality forage available that is in a green growing state. This practice insures the best quality grass fed beef possible that is consistent in its clean beef flavor and tenderness.

Our cattle are harvested in our own processing facility under our direct supervision. This assures that each individual animal is treated humanely and without stress.Skilled butchers who take pride in their art of cutting beef

Our family is passionate about providing our customers with the healthiest, safest and highest quality beef on earth.




A list by state - http://www.americangrassfed.org/produce ... -by-state/

I've heard of them. PM me if you want any additional info concerning their business practice.
 

HDRider

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Turkeybird":1aebhxql said:
Heard on radio yesterday that 1/3 of the workforce in u.s. Processing plants were Hispanic workers. Trump will throw a monkey wrench in their lap
I forget what company, but they put a processing plant in Wilson, or Nash County NC and could not get workers. They wound up bringing in folks from Haiti or somewhere to work there. Crazy...
 

Bigfoot

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I'm not sure where a person would have to live to make that grass fed beef thing work. I just know it wouldn't be here. You could never part out an entire calf crop here to people wanting grass fed beef. Then you factor in to the equation the amount of land you'd have tied up in holding a calf crop over for almost another year, if not a year. Feed cost would be non existent, but land cost (with lost cow/calf production factored in) would be astronomical.
 

Lazy M

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Visited a grass fed beef operation a few years ago. Around 40 hd of feeders that they would buy at 3-400# and finish on grass. I believe that the farm was 150a. Their pastures looked like carpet and their cattle looked very hungry. They purchased high quality alfalfa mixed hay and supplemented with hay year round. They said that it took them around a 12-15 mos to finish them after purchase. Claimed that they had a waiting list for their beef. Not sure if they are still in business, but at the time they indicated that they were pleased with their bottom line.
 

jedstivers

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Bigfoot":3vk4a4kn said:
I'm not sure where a person would have to live to make that grass fed beef thing work. I just know it wouldn't be here. You could never part out an entire calf crop here to people wanting grass fed beef. Then you factor in to the equation the amount of land you'd have tied up in holding a calf crop over for almost another year, if not a year. Feed cost would be non existent, but land cost (with lost cow/calf production factored in) would be astronomical.
Then add in the fact of what grass fed taste like.
Give me good corn fed beef.
 

Lazy M

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jedstivers":3lmtshiz said:
Bigfoot":3lmtshiz said:
I'm not sure where a person would have to live to make that grass fed beef thing work. I just know it wouldn't be here. You could never part out an entire calf crop here to people wanting grass fed beef. Then you factor in to the equation the amount of land you'd have tied up in holding a calf crop over for almost another year, if not a year. Feed cost would be non existent, but land cost (with lost cow/calf production factored in) would be astronomical.
Then add in the fact of what grass fed taste like.
Give me good corn fed beef.
+1.
 

Stocker Steve

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jedstivers":r20e3dvj said:
Then add in the fact of what grass fed taste like. Give me good corn fed beef.

You need to eat venison for a while to train your palette. Then transition to grass fed. :nod:
 

jedstivers

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Stocker Steve":3bik6d5j said:
jedstivers":3bik6d5j said:
Then add in the fact of what grass fed taste like. Give me good corn fed beef.

You need to eat venison for a while to train your palette. Then transition to grass fed. :nod:
I do like venison but they are goats. We're talking cattle here. I want corn fed beef.
 

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