Western beef co-op mixes fellowship with independence

January 13, 2003

By Candace Krebs


At the annual profit conference of Western Ranchers Beef Cooperative in Reno last week, area ranchers heard an invigorating program on marketing and production-related topics. In a general sense, the presentations reemphasized why animal health management and herd sire selection are so important. Farmers love to consider ways to improve production, just as journalists like myself thrill to workshops on perfecting the craft of writing. Still, I found myself musing that no amount of savvy management can make up for the pressures mounting on a shrinking production agriculture sector, much the way that artistic ability alone doesn't insure success in journalism.

Sometimes, as an industry, we are unreasonable about what better production practices can really do. Chad Ellingson, the beef sire procurement manager for Genex, Inc., a semen service, attributed 80 percent of profitability to 20 percent of any given herd. Similarly, 80 percent of profitability is attributable to 20 percent of farmers, but that doesn't necessarily mean we are better off to eliminate the other 80 percent and start over with new ones or foist all of the production responsibilities on the "best performing" 20 percent.

This is where our indoctrination in numbers and measurements and obvious progress runs up against the realities that people and animals are complex living organisms, not machines. Likewise, when veterinarian Nancy Martin admonished producers to "cull like a predator," I was uncomfortable with the idea that producers should feel guilty if they ever act "sentimental." If so, we should also accept big corporations like IBP operating their procurement and sales strategies like "predators" too. In the socialization process, and in business, we're taught a survivalist mentality, a variation of "cull or be culled," but it makes for a lot of conflict and insecurity in human relations. Meanwhile, there seems to be a hidden gift in "nonconformists" and even "underperformers."

Oddly enough, on this same program, Don Nelson, the livestock specialist for Washington State University, presented a topic entirely unorthodox at these sorts of farm production meetings. He called it "holistic decision-making." The point of his talk was that living organisms are "irreducible," meaning they are more than the sum of their parts. As separate wholes, they can't be reduced to anything more partial than that. He also asked the question that is probably most relevant to the agricultural industry right now: "How do you bring a diverse group of people together who are fiercely committed to their independence?"

The current strategy of preference seems to be to form a cooperative. Value-added beef co-ops had a prominent place on the program agenda. But as Nelson presented the steps and objectives of his unique management approach, his input might help explain why those initiatives so often fail.

Marketing co-ops seldom bring people together before the business plan is written or include those with "veto power" in the planning process, which Nelson recommends. And they can restrict the purchasing and selling choices of the individual members in subtle but significant ways. I have argued in the past that efforts like U.S. Premium Beef, which is part owner of Farmland National Packing Company, actually contribute to captive supply arrangements, adversely affecting prices paid for all cattle and feeding into a monopoly system. "Bundling," or dictating the use of certain service providers, is something that Cargill, WRB and many other companies do, but it is a practice that distorts the competition among products and services.

As a tool for furthering the interests of farmers and ranchers, co-ops are "neutral," as Nelson points out. So it's important for potential cooperative members to recognize and appreciate the differences. Not surprisingly, Western Ranchers Beef is a band of independent Western cowboys who solidly respect the individual freedoms of its membership. They aren't affiliated with any of the oppressive monopoly power players. They aren't being too heavy-handed in imposing their vet-med protocol on participants. They have a modest common sense approach to advertising and business growth. And they actually brought the group together before launching a series of marketing initiatives, which include a certified feeder calf program, as well as retailing branded natural and grass-fed beef. After six years together, they've established their staying power.

While the presentations seemed to exaggerate the prospects for beef-related marketing co-ops in general, the WRB profit conference reflected a diversity of opinions and a genuine vitality. They did a good job of counterbalancing traditional production improvement information with sophisticated planning tools that accommodate the complexities introduced by quality-of-life and ecological considerations. This is proof that cooperative endeavors are strengthened when they involve strong-willed, determined, independent-minded individuals. WRB seems as committed to producer education, idea sharing and mutual support as to quick financial returns, and maybe for that reason, they appear to be succeeding.

Candace Krebs is a freelance agricultural writer and communications consultant from Enid, Okla. She was raised on a family farm in central Kansas and earned a bachelor's degree in ag journalism from Kansas State University.