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How to Start a Premium Beef Business

Offer your farm customers high-quality beef by raising registered beef cattle that will sell for a pretty penny upon slaughter.

By Victoria Van Harlingen


How to Start a Premium Beef Business - Photo by Rachael Brugger (HobbyFarms.com)
Photo by Rachael Brugger

Raising registered beef cattle for show and breeding stock sales can have many rewards, from the thrill of winning in the show ring to the challenge of choosing just the right bull for each cow. For the hobby farmer, it can also be expensive. You can overcome some of the red ink on your ledger by taking advantage of the growing market for premium packaged beef sales.

Purchasing registered stock and cattle-handling and -showing equipment, along with show fees, travel expenses, insurance and advertising, make breeding and selling registered cattle an expensive and risky business, especially if you live near a growing suburban area, where farm customers might be few and far between. One way to add profit to your beef-cattle hobby farm is to sell your animals as premium packaged beef. Many larger beef and dairy cattle producers have traditionally supplemented their farm incomes by raising and selling inexpensive freezer beef. Hobby farmers with registered, high-quality, purebred animals have the opportunity to sell superior packaged beef and make a good profit.

Plan Your Production
Starting a premium packaged-beef business takes planning and research. If you’re like most hobby-farm breeding-stock producers, your herd is small: fewer than 12 head on average. You’ve worked hard to produce outstanding calves, and they’re all wonderful in your eyes. Then comes the day you face a pasture full of yearling bulls that didn’t sell and you have no choice but to send them to the sale barn. This moment is your opportunity to turn those calves into double—sometimes even triple—the profit you would receive from the stockyard.

Evaluate each calf according to your breed’s standards and rank them. The bottom two or three are your candidates for slaughter. In most cases, your farm will benefit from this culling. Castrate the bulls, and decide if you will finish them on grain or grass.

With the increase in GMO corn, there is a growing market for all-natural grassfed beef. It takes longer to finish a grassfed animal, up to 36 months, and it will be very lean but commands a premium price. Grain- or corn-fed beef can be finished in 16 to 22 months. Animals fed costlier certified organic and non-GMO grain or corn can command a higher price than standard grain- or corn-fed beef. Angus or Hereford grain- or corn-fed beef will also have more fat content than grassfed beef.

The goal of grain or corn feeding is tender, well-marbled beef. This means the animal needs to be confined to a small space to limit exercise and, hence, muscle tone. If you finish the animal on grain, select at least two bull calves to confine—it’s unwise to confine a single healthy animal, as cattle are herd animals and will try desperately to rejoin the herd if confined alone, producing stress hormones. Keeping two animals together provides a herd-type social atmosphere and keeps both animals happy. The grassfed animals can remain with your herd their entire lives, getting plenty of fresh air and exercise while living their natural herd-based existence. This will produce a less tender beef because the muscle is worked more, but your animal will get the best life possible.

Next, contact your county’s health department to find out what licenses, if any, are required by your state and county to sell beef. Call your insurance agent to discuss liability insurance costs. Talk with your county extension agent to learn of other beef producers in your area, and check with your state agriculture department for lists of slaughter facilities and marketing outlets for beef.

Choose Your Market Approach
With today’s interest in healthy, humane, locally grown food, you can choose to raise and market your product as all-natural, grain-finished, pasture-raised or a combination of these practices. Keep in mind the time it takes to raise and finish each type of product. Grain-finished animals are ready for slaughter at 16 to 22 months of age, but expect to keep pastured beef 24 to 36 months.

The cattle breed can help determine how you will raise your slaughter animal and when you will send it for processing. Any of the beef breeds can be finished on corn, but traditional British breeds, such as Black Angus and Hereford, can provide prime- or choice-grade cuts when finished on corn or corn-based feeds. The leaner Continental breeds can also be finished on corn and grain, but with their naturally lean meat, you might want to tap into the all-natural grassfed market.

The most straightforward way to sell beef is through shares of the slaughtered animal. Offer a whole, half or split half (quarter) to your customer at a set price per pound of its hanging weight. (A split half is the best way to sell a quarter. The customer receives an equal portion of all the cuts in a side, not just the back quarter.) On slaughter day, you deliver the animal to the slaughterhouse and invoice your customer. Your customer then pays the butcher for cutting and packaging separately. This method requires no special licenses or fees, but it might be more difficult to find customers who have the financial means and freezer space to buy in large quantities.

You can add value to the sale by charging your customers a higher price per pound of hanging weight and settling with the butcher yourself, then delivering the packaged beef personally. The customer only has to call the butcher to provide cutting and wrapping instructions. This is a good option if you’ve chosen a slaughterhouse that’s an hour or more away from your customer base. It’s also a good way to add profit to the sale, but be sure to figure your time and travel expenses into the cost.

Selling individual packages of beef requires the animal be slaughtered in a facility that provides, at a minimum, state inspection of the process and the meat. In most counties, you must have a license to sell beef by the package and a county-inspected commercial scale for weighing each package. You will also need to label each package with your farm name, the weight of the package and the name of the cut.

Select Your Butcher and Packaging Preferences
Do some research to find the right private butcher or slaughterhouse for your product. Most private butchers and slaughterhouses are busy year-round. You’ll need to choose one that provides a finished product wrapped to your specifications, but you might have to wait six months or more for a slaughter date.

Visit farmers’ markets or check out other premium packaged-beef sellers to see what cuts are popular in your area and what packaging style sells best. Ask other farmers, feed-store managers and the county 4-H advisor for slaughterhouse recommendations. Visit several slaughterhouses and tour the facilities, asking questions that are important to you about the slaughter process, such as:

  • When should you deliver your animals to the slaughter house?
  • How soon after delivery are they slaughtered? (Holding animals less than two hours before slaughter is preferable because most animals will smell the blood, which will cause them stress.)
  • How will the animal be killed? (Most private slaughterhouses prefer a clean shot to the head versus the stun and throat kill.)

Also ask to tour the hanging and cutting facilities to observe cleanliness, and ask if your beef can hang for at least 10 days. Hanging is important to develop tenderness and flavor. If you’re satisfied with the operation, ask the butcher about cut and packaging; some old-time butchers only cut a few types of steaks and roasts. Traditional ­double-wrapped paper packaging is good, but you might consider the clear, vacuum-sealed, heavy-plastic packaging for improved freezer storage.

Good farmers have always known the value of diversification and more registered breeding-stock producers are finding real opportunities to fill a niche market for high-quality, humanely raised and carefully managed premium beef.

About the Author: Victoria Van Harlingen has spent most of her life as a part-time hobby farmer raising cattle, chickens, bees, and occasionally sheep and goats. She currently lives with her eight cats on a 120-acre farm in southwestern Ohio.

 

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How to Start a Premium Beef Business

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Reader Comments
We raise Galloway/Angus cross for direct sales to customers. the Galloway provides the marbling of fat throughout the beef and the Angus provides a bit more tenderness which is important when raising and selling all grass fed beef. our customers are by word of mouth and we now have a waiting list. We are small herd ranchers but customers will wait for great beef that are raised humanely and happily.
kim, Garfield, WA
Posted: 2/17/2014 7:56:23 PM
We have begun the switch from selling feeder calves to farm raised Angus on our farm. There has been considerably more expense , but our customers are pleased with the quality and tenderness of our finished product . We look forward to providing quality beef for local families.
Alice, Alto Pass, IL
Posted: 1/30/2014 8:11:21 PM
I have a 40 acre farm in central mn. I also own the meat market in town. I've always thought about raising a few cattle for butchering. Any suggestions?
Greg, Hutchinson, MN
Posted: 1/30/2014 7:04:55 PM
Interesting! I hope that everyone's weekend was both great and safe,having a good week and has another good weekend!
Mike, Columbia, TN
Posted: 1/30/2014 5:20:15 PM
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