Mike Callicrate | No-Bull Food News

Will new meatpacking investment serve people or corporations?

Walmart announced this week that they were buying a minority interest in the proposed North Platte, Nebraska slaughter plant, Sustainable Beef.

The $325 million dollar project with the support of Walmart, and now projected to cost more money, plans to break ground next month, but is this the right direction for the industry and cattle producer investors?

The pandemic taught many painful lessons about the fragility of highly concentrated supply chains, dangers that many of us old enough to remember a more decentralized and competitive marketplace, with many buyers and many sellers, warned against.

Big retailers and food service companies got caught in the price gouging of the big-four meatpackers, losing the fat margins that years of concentrating the retail and food service sectors had given them.

Cattle producers make the investment, Walmart gets the returns.

The current administration laid out a post pandemic plan for rebuilding a more resilient and sustainable meat supply chain, but will the plan have a chance if it doesn’t serve the interests of Big Food?

For the last fifty or so years, the industrial “big is better” mentality ruled. Early warnings came from the highly respected economist, Harold Breimyer as he, “… sketched the possibility that all production and marketing might be integrated up to the retailing level: Carried to a distant and perhaps never-to-be-realized but still logical extreme, present trends could well mean that competitive independence may one day be restricted basically to the retailing segment.” Breimyer, pp 287-288.

Perhaps never-to-be-realized? Well, we have arrived.

Chris Clayton summarized the various meat plant projects, including Sustainable Beef, in his recent article, Walmart and Beef’s Vertical Integration. Of concern to me was the massive amounts of investment by both government and private investors in facilities that depend on a low wholesale price while failing to recapture the lost retail share of the consumer dollar for producers.

Additionally, the cost per head of daily production is many times higher compared to a more decentralized local/regional infrastructure like Callicrate Cattle Co.

Unlike the large plant projects designed for national distribution, Callicrate Cattle Company is designed to serve the needs of Ranch Foods Direct and local producers. RFD is a small local/regional direct-to-consumer meat company in Colorado Springs, Colorado  delivering up to 79% of the consumer beef dollar back to the farm and ranch gate, while selling at big box prices. This is compared to approximately 37 percent producer share through the existing highly concentrated and extractive system, and 65% in 1975, the last time the finished cattle market was competitive.

If the industrial model is so low cost and efficient, why does the producer receive so little of the consumer retail dollar?

Consider some of the other differences:

Callicrate processes animals onsite, lowering stress levels and improving meat quality. Shipping to distant slaughterhouses is expensive. A 200 mile trip will cost the producer around $35/hd. with today’s shipping rates.

Callicrate ships carcasses, rather than live animals, essentially eliminating the cost of boxing beef:

Why box the beef? Instead of putting primal cuts into boxes, hang and age longer and cut directly into higher value retail cuts.

Slaughter waste becomes valuable soil nutrients in the onsite Callicrate composting system.

Workers at the Callicrate facility are higher skilled and more efficient than the unskilled, often refugee, workers at the large plants. In 1980, journeyman level butchers at G&C Packing Co. in Colorado Springs, with a four person crew, could hang up ten head of beef per person per day in a simple low cost cradle system. Today, according to published capacity and employment figures, unskilled workers at Tyson’s Dakota City and Holcomb beef plants average less than 1.6 beef animals per worker per day.

Callicrate Cattle Co., invests in and retains more dollars in the St. Francis, Kansas and Colorado Springs communities.

I think it’s clear that the smaller plant approach better serves producers, consumers, and communities, is more sustainable and resilient, while being far less expensive to build. We should give up the idea that everything must be scalable to suit companies like Walmart.

For more:

Let’s say goodby to Smithfield and Big Food

What Could $300 Million Dollars Do?

The names may have changed over the years, but psychopathic business leaders continue to consolidate power around the world’s food supply and means of production.

Will Harris with White Oak Pastures hits the mark on why people like Bill Gates should not be allowed landlord status.

“These technologies have made it possible for a small number of multinational corporations to have control over the entire planet’s food supply. Further, the centralization of food production impoverishes our rural communities …” – Will Harris

The elimination of small farms has been deeply ingrained in policy for decades, led by The Committee for Economic Development. Many of the biggest corporations in the country organized the effort and legislated agriculture policy to move “excess” labor from the farm to the city to provide cheaper labor for manufacturing and industrial growth. Women were also moved into the workforce.

Secretary Earl Butz, under Nixon, implemented the Committee’s policy of “Get big or get out.” Reagan removed even more anti-trust barriers, allowing today’s full blown food monopoly and loss of food security for people around the globe.

Excerpt from the The Committee for Economic Development report:

“We regard direct help to farm people in finding better opportunities in the nonfarm labor force as necessary and desirable, because we believe that a small fraction of the funds now spent on agricultural subsidies would, if spent in ways that tended positively to induce the needed movement of human resources out of farming, result in higher national income and lower national outlays on subsidies.”

“4. As we emphasized in the early portions of this statement, it is the very heart of the farm problem that a massive adjustment needs to be made in the human resources now committed to agricultural production. Small adjustments in the farm labor force will not suffice.

“What we have in mind in our program is a reduction of the farm labor force on the order of one third in a period of not more than five-years.

This, we think, would be large enough and fast enough to offset the effects on farm output of new technology and investment. It would thereby contribute to the basic goal of a net reduction of the resources — human and other — now employed in farming.”

Why our Founding Fathers feared powerful landlords and believed farmers should own their land:

The Irish Land War was an organized campaign of civil unrest in Ireland that lasted from the 1870s until the 1890s.

 Rigged markets and concentrated power continue to force farmers and ranchers to sell their land to the new landlords.

Are we really hoping Bill Gates will feed us?

The Committee for Economic Development carefully planned the farm policy that’s left us with a global food cartel, bankrupted farm and ranch families, and many starving people.The complete report that’s led to the current food system debacle follows:

The true efficiency of the current industrialized food system …

The news about the Vernon, California Smithfield pork plant closing should be met with celebration, not panic. The departure of the Chinese owned pork giant from the state, along with their abusive, extractive, and fragile supply chains, should make way for new more efficient and sustainable local/regional meat plants, but only if the new plants can be assured fair market access.

Building safe and profitable farm to consumer connections – A farm & ranch, small business partnership …

Grant and loan programs should invest in more direct producer to consumer community-based infrastructure outside of and separate from the failed Big Food system.

Any new infrastructure that doesn’t connect directly with independent retailers, restaurants, and the consumer more directly will be a waste of time and money in the current predatory and concentrated marketplace.

Consider building new community based models that connect local/regional producers to consumers via independent food related business like we’re building in here in Colorado Springs.

A handful of powerful companies are getting rich mining the Earth’s precious resources at the expense of planet and people everywhere. Why are we allowing it?

Cargill shutters Avery Island salt mine after fatal roof collapse

Recent news out of Louisiana announcing the closure of the Avery Island salt mine, reminds us of the dangers in dealing with big corporations like Cargill.

In January 2013, Cargill announced the Plainview, Texas slaughter facility that employed 2,000 workers would be closed. Cargill claimed it was due to tight cattle supplies. This came after decades of below cost-of-production prices paid to livestock producers, resulting in a shrunken U.S. cow herd, compliments of Cargill, the other members of the meatpacker cartel, USDA, and meatpacker friendly courts. The Plainview plant remains closed and gutted of the infrastructure and machinery to process cattle. Economic development experts now feel the region would have been better served with many small locally owned businesses.

A bigger reason to close the Plainview plant.

Cargill is the largest privately held corporation in America in terms of revenue. Known for well-informed long-term planning, Cargill leadership knew water from the Ogallala Aquifer was being pumped out in excess of the recharge rate. Like salt, the precious life sustaining water is literally being mined, and in places like Muleshoe, Texas, it’s already gone. Nearly everything Cargill owns depends on abundant and free water.

DAY ZERO is a documentary about the impending global water crisis and how that is one of the most serious and pressing issues of our lifetime.

The Ogallala Aquifer is in steep decline. Since the 1950s, the precious water has been systematically extracted and converted to corporate cash through crops and livestock.

Cargill is the modern-day version of the East India company – the much feared commerce-controlling corporation of Franklin’s day.

For decades, Cargill, known as The Worst Company In the World, has surrounded farmers and ranchers from input to output, stealing the fruits of their labor, buying crops and livestock at below-cost-of-production harvest prices to sell later in the year at higher prices, often much higher. This year, Cargill is raking in nearly double the harvest price, while people around the globe go hungry.

Honestly, why should Cargill care about Avery Island, Plainview or Muleshoe Texas, or even the Ogallala Aquifer? Like a strip-mining shovel looking for coal, Cargill searches the world for resources to convert to shareholder cash and equity, draining countries and communities of their critical life sustaining resources, including as majority owner of the largest grain terminal in resource-rich Ukraine.

So, why do we continue to allow a handful of global corporations of exploit planet and people? Perhaps the U.S. Senator from Cargill’s home state, Amy Klobuchar, could help answer the question? Although the Senator didn’t mention Cargill in her recent book, Antitrust: Taking on Monopoly Power from the Gilded Age to the Digital Age, wouldn’t Minnesota’s biggest multinational corporation be a top choice for breakup?

What do you say Senator Klobuchar?