The Economics of Eating Beef from a Small Local Farm

June 28, 2018

I believe options are good.  Everyone has the God given right to choose. One of those choices we all have is to consider where we purchase our meat, specifically our beef.

So where does that leave us in the battle of choosing to acquire our beef from small local farms versus large Agribusiness (your typical grocery store)?   My thoughts are small farms produce less volume but are more likely to grow, consistent, tasteful healthful foods and might be more environmentally friendly, while large Agribusiness are sometimes environmentally unfriendly but raise large amounts of food that are cheaper in price and quality.  

1. “Big Beef” (large Agribusiness, industrial beef producers) makes food more affordable. Industrial beef producers are larger and focus on weight gain, even through non-natural means to produce high volumes quickly. The cow –calf producer wants genetics that produce strong, fast growing calves and some use steroids to enhance those genetics. It is not about culinary outcomes, health, or the taste. Industrial beef rewards the seller based on weight, and weight alone.   The feedlot buyer that purchases these calves never gives the cow-calf producer information about the eating quality of the beef, so there is nothing for him to base his genetic selection on when he breeds next year’s calves. It is impossible to improve the eating quality of US Cattle genetics when there’s that disconnect.
2. Large Industrial food systems use concentrated animal feeding operations (CAFOs) which have misguided outcomes. Concentrated animal feeding operations (feedlot), which house hundreds or thousands of animals in close quarters and produce most of the beef consumed in the United States, receive subsidies to their feed and pollution cost while leaving behind staggering bills for taxpayers.  The Union of Concerned Scientists estimate that these costs include $26 Billion in reduced property values from odor and pollution problems, up to $4 billion in drug-resistant infections attribute to the overuse of antibiotics in livestock production, and $4.1 billion in soil and groundwater contamination.  Whatever efficiencies feedlots add to the livestock sector would be quickly outstripped if the operations were made to internalize these costs.
3. Small local farms are making a relatively minor dent on the US food economy “at large” and need to scale up. Today, many beef producers are marketing the fruits of their labor close to home --- via direct markets, like farm stands, farmers markets and Community Supported Agriculture programs – and helping money to circulate in their communities.   In 2015, direct market sales rose 29% percent reaching $3.7 billion from their 2002 level of $812 million. This growth demonstrates a clear and growing consumer preference for local beef produced from family farms. While trend is promising, direct marketing accounts for just a little less than 1% of the total Beef sales and are generally accessed by the smallest farms.  At the same time, the largest, industrial beef producers are still getting bigger, with just four (4) US companies now producing 83.5% of the beef market. Hence these two sectors – one direct and local, the other large industrial and global – coexist side by side, without creating the transformative change in the way we consume meat we so urgently need in this country.
4. The case for small local beef producer and ripple effects of a local farm economy. Shipping food thousands of miles and internationally is bad for the environment (duh).  Pretty sure this is self-explanatory. It’s a safe bet that buying local is the “greener” choice simply because it had to travel less far to get to you. Think how long a boat ride, then a truck ride an Australian piece of beef travels to your grocery store. Not all beef is created equal.  The local farmer’s use of cattle herd genetics that consume local grasses and grains gives the smaller farmer the opportunity for feedback data he needs to achieve beef that is superior in taste and sustainable.  Researcher Viki Sonntag analyzed the local multiplier effect of food related businesses in Central Puget Sound region of Washington State and found that shifting 20 percent of food dollars in “locally directed spending” would inject nearly $1 billion into the region’s economy each year.  This impact exemplified in the restaurant sector, where Sontag found that spending $100 at a chain restaurant results in $31 of income for local businesses. Yet, the same $100 spent at a locally owned restaurant would offer $79 for local businesses. By the same token, food grown by local farmers for export earns $1.70 in community income for every dollar of sales.  But a dollar spent at a farmers market can generate $2.80 for community’s economy. There are many studies across the country echoing Sontag’s findings. The critical takeaway, however is the power of local spending in promoting more stable and prosperous economies and communities.

In conclusion it is not just about growing more good beef.  The structure of today’s food economy is not inevitable; rather it is a reflection of choices.  The future we seek is a matter of making a choice to create and strengthen local and regional markets that support family farmers, and in turn fortify the health and prosperity of all Americans.  I argue that both Industrial farming and small farms have a place in our society. For the conscious consumer, I’ll just say this: I still stand by my belief that supporting small, local farms is best-when possible.  You can easily audit the local farm on their standards such as Grass Fed, intentional genetics and their water sources, no use of hormones or antibiotics, no concentrated animal feeding operations, and how the animals are cared for daily.  The beef produced from a local farm will be more consistent in taste and quality. I know some are impressed with “$4 a pound hamburger” and realistically, local farm beef is not affordable for everyone, and no one should feel bad if they can’t make that choice.  All we can do is make the best choice available to us and our families. What will you choose?