Kentucky is one of the largest beef cattle producers in the U.S., but the state is still struggling to develop the resources to process its beef in-state. (Chris Fryer/Farm to Fork)
By Amanda Loviza/Farm to Fork
Kentucky is the biggest beef cattle producer east of the Mississippi River, raising 800,000 head of cattle each year. But the odds of finding a steak that is 100 percent Kentuckian—born, raised, slaughtered and processed in the state—are slim. Only four percent of the beef consumed in Kentucky was actually processed there, according to Bill Clary, director of public relations for the Kentucky Department of Agriculture and brand manager of Kentucky Proud Advertising.
As the “local” movement picks up speed and the Kentucky Department of Agriculture tries to bring more value back to farmers, Kentucky, like other states, faces a variety of obstacles that prevent the development of a large-scale, affordable local food network. Some of the challenges regarding the supply of local beef include unpredictable weather, a lack of slaughterhouses and the need for a comprehensive distribution network.
The Kentucky Proud program , an initiative to promote products grown or processed in Kentucky, came under fire when it decided last year to contract PM Beef to oversee the finishing, slaughtering and processing of Kentucky beef. PM Beef is a Minnesota-based company. Through the PM agreement, investors buy Kentucky cattle at auction and ship them to feedlots in Iowa. PM contracts with the feedlots, finishes the cattle with a high-corn diet and ships them to Minnesota to be slaughtered, processed and packed. The beef is guaranteed by affidavits throughout the process to be the same Kentucky line. Then the beef is shipped back to Kentucky to be sold in grocery stores.
Bruce Brooking, the executive vice president of sales and marketing at PM Beef, and also a resident of Kentucky, said that his company is trying to increase demand for Kentucky cattle.
“Demand is going to create higher prices,” Brooking said. “I think this will be a very good program for the farmers of Kentucky.”
Billy Ray Smith, a beef farmer with the Green River Cattle Company in central Kentucky, agreed that the PM Beef line could be a very positive thing.
“We’re getting Kentucky beef back here,” Smith said.
Amy Sipes, who runs John’s Custom Meats with her husband, was furious when she heard about the PM Beef agreement. As a small local meat packer, Sipes said she thinks that Kentucky could process all its meat in-state if a local system was set up. But she said the distribution network is the downfall for small local meat processors.
Without a distribution network that will transport a small local meat producer’s product to stores across the state, the little guys just can’t compete with larger companies’ prices, she said. By shipping the cows to the Midwest, where all the cheap corn and large feedlots are, PM can keep its prices down. Low prices and a big name appeal to large distributors. Small meat processors struggle to develop a distribution network, but the Kentucky department of agriculture helped PM develop a distribution network through Critchfield Meats, Southern Foods and Brown Foodservice.
Warren Beeler, the director of value-added animal agriculture production for the Kentucky Department of Agriculture, credits PM Beef for the fact that Kentucky beef products are now being offered in grocery stores across the state.
“Kentucky Proud wouldn’t have any beef products at all in the grocery stores if it weren’t for PM Beef,” Beeler said.
Clary said that with the creation of the PM Beef contract and its distribution network throughout the state, other Kentucky Proud products are being transported as well, such as jams and sauces. This is the first time Kentucky Proud is being distributed cost-competitively, he said.
Sipes doesn’t think PM Beef should be labeled “Kentucky Proud,” since a lot of the production occurs out-of-state.
“Honestly, it’s kind of a slap in the face to farmers who are selling a local product,” Sipes said.
Sipes is not the only one to be offended by Kentucky Proud’s agreement with PM Beef. Clary said the department of agriculture has heard “very vocal” complaints from some people who object to labeling PM Beef “Kentucky Proud.” The PM contract led to Kara Keeton’s Business Lexington column in January, “Is it time for Kentucky Damn Proud?” Keeton does not object to the PM contract, but she discusses the difference between Kentucky Proud and the idea of “Kentucky Damn Proud,” which would mean a product was grown and processed in Kentucky.
The Kentucky Proud program has never claimed that all of its products have remained in the state from conception to sale. In order to be labeled Kentucky Proud, a product must be produced or processed in the state. Clary says the objective of the program is to bring value back to the farmer, in whatever way.
“Kentucky Proud is a very very diverse movement, and at the end of the day we’d like to feed all of Kentucky from our farms,” Clary said. “But that’s not going to spring forth like Venus from the head of Jupiter. We hope this program will help get us to that point.”
But Beeler said that he understands that the Kentucky Proud label can be misunderstood by consumers.
“We’re not intentionally misleading people, but I think unintentionally I think we are, and that’s not good,” Beeler said. “We need to make sure people understand.
Beeler said there are good reasons why Kentucky Proud includes products produced or processed in Kentucky, but he said maybe a two-tiered system would be beneficial to consumers.
But as far as being able to offer Kentucky beef to Kentucky consumers, PM Beef is helping, Clary said. Including the PM Beef as Kentucky beef, the contract will double the amount of Kentucky beef that is sold in-state, he said.
The concept of building enough facilities in Kentucky to process all 800,000 head of cattle that are produced in the state is not going to come to fruition any time in the near future, Beeler said, although it could happen eventually. Today Kentucky has 16 small USDA-inspected processing plants, and no large cattle processors, Beeler said.
The small plants do not process enough animals to sell the blood or other byproducts, so instead of having an extra avenue for profits from the cattle, small processors lose money getting rid of waste, said Mary Hendrickson, director of the Food Circles Networking Project and a rural sociology professor at the University of Missouri. Like in many areas of the country, consolidation in the slaughter industry has limited the availability of slaughterhouses in Kentucky, but the plants that are in the state have increased their capacity over the last 10 years, according to Beeler. Beeler said three plants are in the planning stage.
And along with the lack of slaughterhouse facilities, there is also a lack of feedlot facilities. But the lack of feedlots is not an accident. Kentucky’s unpredictable and often rainy weather is not conducive to the finishing stage of beef cattle production, Clary and Beeler said. Feedlots are more confined than grazing, and rain makes them messy. Most large feedlots are farther west, where there is less rain and the smell will not intrude on towns.
Both PM Beef and Kentucky Proud say that it makes economic sense to ship the cows west when they are small and less costly to transport, and then take advantage of the cheap corn feed and the wide open spaces. Beeler said since the feed is cheaper out west, processing plants also set up there. One is leading to the other, which is also why PM Beef’s processing plant is in Minnesota.
Beeler said he “can’t imagine” that the PM Beef line would hurt small Kentucky processors, because it is a different market.
But whether PM is taking business away from local processors or not, Sipes said she thinks there is a different option for the Kentucky department of agriculture to help market Kentucky beef. She said she thinks if the ag department would help small processors develop a distribution network, they could process the beef in-state.
“It can be done on a local system,” Sipes said.
Amanda Loviza
Amanda Loviza is a senior news/editorial journalism and Spanish major at WKU and will be pursuing a career in magazine writing after graduation.
Great article. My concern is that the small local farmers that process their meat in state will suffer as people start buying the “Kentucky Proud” meat. There very well may need to be a two-tier system for Kentucky Proud.
One key question is transparency. I think it’d be pretty easy to prove that the buyers of a product using the Kentucky Proud logo and stating that the beef is “raised on Kentucky family farms” would expect that beef to be from Kentucky, not Kentucky via Iowa and Minnesota. Few people like to feel snookered. Critchfield would do itself and all a favor by stating clearly that the beef originated in Kentucky but was finished elsewhere. Let the customer decide whether this is important or not. As Alex notes above, a two tier system for Kentucky Proud would also go a ways toward providing consumers, chefs, and institutional buyers the transparency they deserve.
The other reason to provide transparency is because it allows people to buy beef that appeals to their personal taste buds or values. After all, as with wine or whiskey, beef flavor and texture will vary depending on the farm, breed, crossbreed, growing & finishing regions, specific diet, husbandry practices, pharmaceutical interventions, aging time & technique, and talent.
Thanks for the article. Good information.