377 - Beef In The 21st Century

American consumption of beef — contrary to predictions otherwise — has held up amazingly well, despite beef prices outpacing the rate of general food inflation. 85% of that beef is processed by the “Big 4” packers. Looking ahead, what changes are coming for beef? Will smaller meat processors, backed by federal grants announced a few years ago, change the landscape? Will food inflation, environmentalist’s lobbing, or the marketing of synthetic meat decrease beef consumption? What about direct-to-consumer beef production and niche beef companies — can they reach scale in a marketplace dominated by legacy producers? Jeff and Kara Smith with Colorado Craft Beef join Damian Mason in this lively discussion about the future of America’s favorite meat.

The Business of Agriculture Podcast with Damian Mason is Sponsored by:
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Redox Bio-Nutrients redoxgrows.com
Truterra truterraag.com

This content is protected. ©Damian Mason, all rights reserved. Not available for AI.

 

Episode Transcript

(00:06):
Beef in the 21st century.
What lies ahead?
What mistakes are we making now?
What corrections will we make?
And where does this whole thing end up?
Beef.
We're talking about
in this episode of The Business of Agriculture.
Hey, Damian Mason here with a question
before we hop into this episode
of The Business of Agriculture.
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(00:27):
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(00:48):
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(01:31):
Hey there.
Welcome to another fantastic episode
of The Business of Agriculture.
It's me, your host, Damian Mason.
You knew that
because you heard that in the introduction.
I've got some awesome guests here.
I've got Jeff and Kara Smith,
husband and wife ranching
entrepreneur, business team out of Colorado.
They have a direct to the direct
to consumer beef business,
business background, academic background.
The smart kids, you'll hear from them in a second.
We're talking about beef in the 21st century.

(01:53):
You know what?
We're eating about 57, 58 pound of beef last
I look, of course, these prices are very, very high.
The direct to consumer thing
continues to see growth.
There's an infusion of outside
money coming into this.
A couple of years ago,
there was money thrown
at the whole packing industry.
We were going to create smaller packers
to compete with the big four.
Is that really happening?
It wasn't even significant.

(02:14):
We've got a lot of changes afoot.
Also, beef prices are really, really high.
Beef herds at a historic low level.
We've got the whole beef on dairy.
We're breeding
Holstein cows, to Angus bulls,
to beef up the beef herd, lots of things going on.
And we got two experts
that are going to share their thoughts
on as we look ahead for
what is going to happen in the world of beef.
If you like steak, if you eat cheeseburgers,

(02:35):
or even if you don't,
you need to listen to this episode.
So thanks for being here, Jeff and Kara Smith.
Kara, you got an academic background,
your ranching background, your Colorado,
and give me the give me the 30 seconds on you firm.
So where I'm sitting right now
is actually a half mile
from our family's original homestead.
So, yeah, our large homestead act.
My family came out here,

(02:56):
found a piece of ground that they liked.
The grass is about Billy Height
and my great great grandfather's horse.
And he decided that he was going to stop here.
So he did.
And this is where we've been ranching
ever since the early 1900s.
So I have a history course in the beef industry.
But also I decided to take that a step further,
and my education is in it as well.
Bachelors in animal science,

(03:17):
Masters, ruminant nutrition,
always been fascinated with the
the interface
between health and nutrition
when it comes to to cattle, especially calf health.
So experience in the feed yard space
then went into animal health.
Had experience
on the business side
there and then exited animal Health

(03:37):
and started on the entrepreneurship track
of where Jeff and I are today.
When we launched Colorado Craft Beef in 2017,
where and Colorado was a big,
huge square, rectangle, square, where are you?
We're in the northeast corner of the state.
Thank you.
If you you've met up with this ranch woman
somewhere along the line,
and you come from a business background,

(04:00):
give us the 30 on you.
So I was born and raised in Pendleton, Oregon.
So Pendleton Woolen Mills, Pendleton whiskey,
very ag centric Hills and or Pendleton Rodeo.
Yes, sir.
The Pendleton roundup, right. I'm sorry. Area.
Yeah.
Went to school at Colorado State
University, got a degree in ag business

(04:20):
because I like math.
And I figured if I could do
math and AG would be in pretty good shape.
I was a Cargill manager for a while,
went into heavy
construction and project management
across AG and other verticals.
Spent some time
working for a company out of the Midwest
by the name of the Brandy company,
where I was a technical sales
manager for people like land O'Lakes

(04:41):
and Coors on robotics and grain processing.
Before doing about a four year stint
in private equity,
where we started to transition into our stuff.
So I bring a very odd mix of operations
management, sales
with, you know,
topping of private equity knowledge
that, well,
I think when you put Kara and I skill set together,

(05:03):
it creates a
very interesting dynamic in the ag space.
It indeed.
Okay,
so you've got a direct to consumer beef business,
and I want to get into that.
But before I do, I opened the topic
by saying beef in the 21st century.
And I went along a lot of different lines.
I mean, we can talk about any of these.
You know, it's obviously
you guys both are knowledgeable.

(05:24):
You work in it certainly is raised in it.
What have you. Okay.
Whichever one you know, it's almost like,
you know, pick a topic here.
Let's just go with the one on,
the Packer situation.
It was,
if I'm not mistaken, two years ago,
a bunch of federal money
now, a bunch compared to you and I.

(05:45):
And what we have in our in our in our bank account,
but not a bunch compared to what
Cargill, Tyson, JBS, you know,
and those big ones have
a boatload of money
was flowing
from the federal government out here,
or it was set to be flung to create
an opportunity for smaller beef packers.

(06:06):
Did it happen?
Is it happening? Did you guys capitalize on that?
We were going to set up
sort of a tier two Packer or a tier three packer
system, and I'd I'd say, well, I thought I was
I did a recording about it
with, someone in the hog business,
and I'm not sure that anything's come of it.
Unfamiliar with a couple of plants that were built.

(06:28):
They actually just announced
a USDA grant for a plant in Craig, Colorado.
That's somewhere in the neighborhood
of 8 million bucks.
But I'm also familiar
with some of those plants that were recently built
that are already shutting down.
If because they didn't exist,
because the economics are hard.
And, we can say that because we own our own small

(06:48):
harvesting facility.
Yeah.
The economics are not conducive to commercial ag
and those challenges, I think,
were outweighed by an
emotional response that is giving people pause.
Even in the bigger Packer
sector, when you see some of the,
what I would say
mid-level packers
and the 1 to 2000 head range going up,

(07:11):
that is still a mathematical problem
when you're competing
against the Goliath of the Big four.
By the way, Kara,
to the person I was prime herself.
You know, I've got my investor buddy
that went to college
with not an ag guy listens to this
and it gets shared around to non ag circles.
So to the person
that listen to this that I would say,
you know they might be in the cranberry
processing business.
They're saying what the hell is he talking about.

(07:32):
So real quickly
since you were raised within it, explain kind
of how it's typically worked.
There's cow calf operators like your parents were
and your grandparents were.
They have a cow that has a calf.
The calf gets to a certain weight.
Usually it's weaned.
And then it goes maybe to a background
that takes them from 600 pounds to such and such

(07:52):
kind of just give us.
And then then it bleeds into how most beef
that's on the grocery store
shelf, most beef is
consumed is processed by the four big packers.
So just give me the
fill in where I didn't right there
with your experience, please. Sure.
And that's one of the big differentiators in the
the beef industry is we are so heavily segmented

(08:13):
because everybody has different resources.
So you have different land.
You know, maybe like you said,
you're a cow calf producer.
Historically, my family has been yearling stocker,
depending on what part of the world
that's the definition. Or we have grower cattle.
So we're taking them from the time
that they leave their mom
and we take them to the next stage,
whether they're on the way to the person.

(08:33):
Again, it's the cranberry processer
5 to 600 pounds probably.
They get birth,
they weigh,
they weigh 75 to 100 pounds when they're born.
And, you know, they're on the calf.
They're out there grazing around
and sucking the mama's, udder.
And then they take them to.
And then from 5 to 600 pounds,
I would call them feeders.
You'd call or stockers, right? You'd call them. Yep.
Stalkers or a growyard.

(08:55):
You know, we we function in all facets of that.
So yes, from that 5 to 700 pounds.
So either go into in our area typically a grow yard
or to stocks or,
you know, something to grow them to that next stage
to where they in
where we live, we'll go to summer grass.
So they'll go to grass from April
till typically August time frame.

(09:16):
And then they'll go into the feed
yard to be finished.
And then of course,
typically the commercial chain
will go into the big four packers from there.
After the finished cattle.
To a person that's not familiar, it's
I know that the person that's losing suburbia,
you know,
outside of Chicago, thinks that this is all Farmer
Brown with his bib overalls that's got Bessy and

(09:37):
and which is more of a dairy cow name,
I think, historically, anyway.
And that
there might be four different entities
that touch this calf after it leaves the mama
and before it gets to your plate.
And that's not even counting the packer.
So I mean, kind of just touch on that.
How the system tip, I'd say for what the
that since the 1950s has essentially

(09:58):
been this system.
Yes. Yeah.
So you'll have the cow calf producer
then typically to the stage of stocker backgrounder.
So then you'll have another set of hands,
then you'll move into the feed yard.
Sometimes they're the same that,
you know by that point you could have that's
that's the third set of hands
that these cattle have changed
by the time they get there.
Then they go to a packer

(10:19):
one typically one of the big four,
and then they'll go to could go to food service.
They could go to retail.
You know, with us, of course,
we're going direct to a consumer.
So we're taking out two of those steps.
But I mean, you could get to 6
or 7 steps of the cattle,
whether they're live cattle or beasts
that have changed hands
before they end up on your plate.
Jeff, when you and I prepped for this,

(10:41):
You threw out the number 600,000 per week.
I think that's a dizzying number.
So again,
always bearing in mind that many, many people
from many different corners of
AG listen to the business of agriculture,
watch the business of agriculture.
And so I've gotten I know people do.
It's just speak to that 600,000 a week.
That's essentially the the capacity
of the big for meat processing companies.

(11:04):
In a week they'll
kill.
And I know we say harvest,
kill and butcher
600,000 head of fat cattle per week.
Yes. Yeah.
On average nationwide
that's going to be what they hit.
In something else for the listeners.
You know, in the hog industry, it's 3 million.
And then annually we process, per week conference.

(11:26):
Yeah, per week.
And annually
we process 2 billion chickens in this country.
So when you start thinking about that
on a mathematical level, probably the most fun math.
I did this for a podcast
we did in Las Vegas about a year ago.
I did the math on how many cattle a day
are consumed in New York City proper.

(11:47):
If you use the average math of the U.S.
and it's about 6000 head a day
just for the beef consumption
needs of New York City. Yeah.
And when people think about that from,
oh my goodness.
Like how many things are moving to make that happen?
The the easy answer is a lot.
The easy answer is a lot.
So that's funny.
2 billion broiler birds get slaughtered

(12:11):
to be
for consumed
per year in the United States, 3 million fat pigs,
fat hogs per week, 600,000 beef per week.
The big four came under pressure.
And by the way,
the big four,
for those that don't know, go ahead and say
I said Cargill already.
JBS, go ahead. Give the rest of them. Tyson.
Tyson and National.

(12:31):
Yeah. National.
Those four came under pressure
and Kara,
your whole
you've got a whole history of dealing with them.
And and one of the people on here
even worked for Cargill,
which is one of the companies that obviously
the differentiated AG, company that it is
they get under pressure every couple of years.
Cory Booker, the senator out in new Jersey,

(12:54):
has a thing for the
the processing meat processing business.
He's like the
I think he visions himself
as the Upton Sinclair of the Senate.
I don't know, but, we've got this thing.
Wait a minute, dear listener.
You're saying,
what the hell is Damian talking about?
Don't do it now. Continue. Listen.
But look up Upton Sinclair, the jungle

(13:14):
famous lit work of literature.
That, actually,
the author's in an interview
says he set out to actually,
write a really good book
to promote really socialism.
And,
it turns out he changed the meat industry instead.
So anyway,
every, every couple of years, the meat industry
as it is, gets,
the word media, media overuse the word attack.

(13:36):
So I won't say attacked,
but shall I say put the screws to him a little bit.
Remember, Tyson had to run a bunch of ads,
like in the Wall Street Journal
and USA today a couple of years ago,
sort of as a mayakoba and all that,
but nothing ever changes.
Yeah, I think, Jeff.
Yeah, I think the issue you run into is
it is so big.

(13:57):
Actually Temple Grandin
had an article about this during Covid.
She said, you know, Covid exposed how
deficient yet fragile our food system is.
The very.
And it's a very accurate statement, by the way.
It's it's efficient. It's low cost.
It provides the hell out of protein.
I mean, look around.

(14:17):
We're eating 220 pounds of animal protein per year,
per American, roughly in the year 2024.
Almost 100.
That's chicken 58.
But as I said is beef,
you know, no, 50 or 52 of it's pork.
And and and for a few months
when we had that crazy stuff
going on because of economic shutdowns, Covid, etc.,
it's always there.

(14:38):
You talk about efficient, but the fragility.
I want to,
you know, Cara, it's been a while since you talked.
Is it fragile?
Is it fragile from your perspective,
not talking about your direct to consumer?
We'll get to that in a minute.
Is it for sure? Yes it is.
But what I will say,
we know from the big four perspective, we,
we talked about it
in about every meeting that I went to
for the past ten years of being in industry.

(15:00):
And I looked around and I was like, well,
what are we going to do about it?
So that was part of why we started
our direct to consumer company, was that thought
process of,
we need to have a direct line to our consumer.
That was really where my head was at with
that is we need to have that conversation.
We need to be able to capture the value

(15:21):
of what we're creating.
And we were not able to do that.
When we're going through the large system,
we're so segmented from it.
But I want to
I want to do a couple more wrap up on the big four,
and then I want to talk about the movement
to direct to consumer and and its viability.
Certainly you guys are doing it.
But also I think it's got a I think it's got a cap.
But anyway, before I do that, I want to,
talk to my listeners and viewers here about Redox.

(15:42):
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(16:03):
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(16:23):
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The big
four happens not just in beef.
It's in grain handling
the ABCD Archer, Daniels
Midland Bungie Cargill Dreyfus.
It happens and the airlines the big four airlines
American, United, Delta and southwest carry 82%

(16:47):
of every traffic passenger ever
passenger traffic in the United States.
Big four and banking basically big four
and sell you for cellular phones. Okay.
Once you get past Verizon and,
you know, T-Mobile and US cellular,
you get that's it.
It's reasonable that there's
the big four in everything.
Why would it change?
And,

(17:08):
and maybe it's
because the cost of infrastructure is so massive.
Go with the airlines
or go with great handling
or go with beef and and meat.
The margins are actually not very good.
Like if I gave you $10 billion.
Jeff, you're a
former and former,
private equity kind of guy, investor kind of guy.
If I give you $10 billion,

(17:28):
would you invest it in beef processing?
Other than the fact that this is
what you do with your bride, you say, hell no.
I can get better margins with $10 billion
going a lot of places, am I right?
Yeah.
It's not that we don't love the industry,
but it has to make financial sense.
And I think that is the the hiccup.
Everybody's missing.

(17:49):
And I think if there is an opportunity
to disrupt the big four, it probably comes
with some technology updates
where they have to retool the big plants.
And if there becomes some big capital
expenditure that you know
well into the billions of dollars,
you may see a bit of a shift away from the Big four.
But they are so impossible to compete against.

(18:13):
They also they provide really low cost protein
for a lot of people.
I don't think we want to take that away
as a as a country.
I'm not sure how to get out in front of them,
even if every direct
to consumer person in the country
rallied on that stand, if you will.
Yeah. Kara, your thoughts.
And again, I'm throwing this out there.

(18:35):
I've discussed it before
about the viability
of, you know, being
the big if you broke up the big four.
I mean, this had before
some of us are old and remember,
they broke up marble.
Okay. Yeah.
You know, broke up was the know the
the the phone system back you

(18:55):
I think they made 72 subsidiaries out of that.
Now what is it.
But now there's no landlines
or nobody
even wants to operate a company
that operates landlines
because there's no money in it.
And instead
we have cellular businesses and there are four,
right.
Three.
So, Kara, from your standpoint,
does it ever change?

(19:18):
I think we can make movements.
And we can have an impact
at our local level, at our consumer level,
we can raise awareness,
we can have more conversations,
we can have our consumers because of course
that's where we kind of come from.
Is that for process of our consumers,
of being more knowledgeable about these things.
But at a scale, especially from

(19:39):
an economics perspective,
there's a reason they exist.
And, and I think that is is a part
is the, as Jeff mentioned,
being able to produce our, our protein
for people to consume
because beef is already high costs enough
so that we have a ceiling especially now.
I mean, absolutely,
I mean, we're trading 26 to $2800 fat cattle.

(20:02):
That's unheard of.
I mean, that is crazy.
So, and and the demand is staying,
so we need to look at it
and I would say we gotta look at it
both both directions. Right.
But from a business perspective, there is a reason,
as you mentioned, that there's
the big four in a lot of industries.
So there's also then there's tier two,

(20:22):
just like there's
Spirit Airlines,
Corsair going bankrupt
or there's Allegiant Airlines or whatever, just like
there are as a tier two.
And and I don't know, I can't name them.
I mean, you probably can that are, that are like
you said, Jeff,
they're butchering a thousand
a week
as opposed to whatever the hell
they're you're gonna go to Dodge City, Kansas.
And there's more.
There's more critters getting slaughtered every day.

(20:42):
You just can't imagine.
But anyway, there's a tier two level
that are doing some.
And like you said, they're in that bad purgatory.
They're not big enough to be Cargill
and have economies of scale
and also control markets.
And they're not small not to be niche there.
I think that's like
it's like being a dairy farmer
and being a conventional dairy farmer.

(21:02):
Now milking 100 cows, like, I'm
not big enough to be a commodity
and I'm not smaller to have an a niche
where I'm organic, grass fed
all my all my cows are named Molly
and they get petted by a rabbi or whatever the hell
I think is a terrible place to be in the middle.
Am I right?
Yeah.
It's a scale of economy question.
I mean, that exists.
But side note for some of the viewers,

(21:23):
that scale of economy in the winery
industry is 10,000 cases.
And below is niche
40,000 cases and above is commercial,
and it exists in every side of ag.
Yep.
And I think the issue you run into,
we've ran into this with our company,
even though we own our entire supply chain.
But we find a restaurant,

(21:43):
they want 300 pounds of ribeyes a week.
They don't want the rest of it. Yeah.
That's. Yeah.
So where do you
where does the burger go
and where do the arm roasts go.
You were the Chuck's go right.
Yeah.
And that's I think that's the hardest part is
everybody wants the convenience of the big four
because they can get exactly what they want

(22:03):
at the cheapest price possible, but
they want the feel good of buying
from somebody like us.
And not to say anything negative on the big four.
It's just a different model.
But when you look at that,
there's just a mismatch in consumer expectations.
And that is
you know,
one of our taglines
with the company is we're here to engage
with the consumer,

(22:24):
not educate, engage
so that they have someone to talk to.
I appreciate that, by the way.
I have a
I have a almost a problem
with that whole educate the consumer.
I think your girl Catherine ...
And I did an episode about educate the consumer
because I was proud.
Would you ag people quit with this
educate the consumer thing?
What if the consumer doesn't want to be educated?

(22:46):
You know, but Apple I've got this iPhone.
I paid $1,200 for it.
I use the shit out of it.
It makes my business more successful
when I'm on airplanes getting ready,
go down the runway.
I'm still texting out stuff and emailing clients.
I can get on here and take videos.
I just shot a podcast with it.
I don't know how it works.
I don't know where it was made.

(23:07):
I don't give a shit.
That's where I think
I always had to explain to my consumers,
you know what?
If they care about your story, tell them the story.
But we pretend
that they want to be educated about how look like.
Are you educated on how your cell phone works?
no. educate them where it came from?
no. Do you care? Nope.
Anyway, here's the thing that you do have.

(23:28):
You have consumers
that don't necessarily care about
how the beef, embryos are inserted into
or all the stuff
that Kara knows inside now because of her vast
educational background.
But you have customers that care about a story,
and that's why they buy direct from consumer.
Is that why they buy?
Is because a story, or is it because the quality,
or is it
because the feeling

(23:49):
that they get that they're supporting
a local coloradoans?
What is the reason?
I know why I bought my iPhone.
Why do your customers, I would say
all of those, frankly, from our perspective,
because we do stand on the mantra
that our customer is our hero.
I mean, we're we're the guy.
It's kind of like Luke Skywalker
and Yoda,
like the customer is what what matters in our story.

(24:11):
Because even in the beef production chain,
I've had numerous conversations
across this country with beef producers.
I ask them what they produce,
and I historically always get
why I raise a 600 pound calf
that I sell the second week of October,
and I have to look and be like, no, you raise beef
like we're in the beef business.
And if we do not have a consumer who's eating beef

(24:32):
and knows it, trust it,
likes it, loves it, continues to come back.
The viability of our industry is
is it's short, it's shortcomings.
I mean, it's it's on the it's on the downhill slide.
So, I would say that's what we heavily
focus on is all three of those,
there's different producers

(24:52):
from different types of beef.
You want to talk grass fed grass.
Finished that. People buy it for different reasons.
But I do feel like it's still a win
when people are buying these.
I'm gonna go ahead and just, piss off at least,
half the people in your industry
because I'm, give them some truth,
and I'll hold up a little mirror right here.
And I think my man Jeff is going to probably
actually have to look away and snicker,
because he's got to realize, I'm being honest.

(25:14):
I've worked for every, every corner of agriculture
you can imagine doing speaking engagements
and various work that I've done.
And I'm from a dairy background.
Obviously, my education is in agriculture.
I got it the most bullheaded.
You ain't going to tell me what to do.
Corner of agriculture in the friggin country

(25:36):
is beef.
The most bullheaded, I'm going to stand here.
I'm a cowboy boots, my cowboy hat.
You ain't going to tell me what to do.
I'm telling you the most. I will change.
Piss on you.
I'll do what I want, however I want to do it.
People are in beef.
My right.
I couldn't agree more,

(25:56):
by the way.
It's debilitating
because I remember
asking somebody in the feed yard bowls.
But them taking carcasses up to 6000, a hoof
weights up to 600
pounds, and carcasses
at that point would be, what, 11?
The 1100 probably or so. Right.
And I said to the consumer, as there's no
what they said.
No, they said what I said the consumer,

(26:19):
the person that buys your product.
Did they ask you for burger?
Well, no, you know about it.
It's about what we can,
you know, get through the feed yards better. Well.
And what the Packers. Why is it.
Never once was it
when you say there's the consumer want this
the and the reply was what was its look.
Oh, never even thought of that.

(26:39):
Oh, I've said it
on a couple of different engagements.
I said, you know, the thing I love
about the ag
industry is everybody is so fiercely independent.
And the most infuriating
part of the ag industry is that
everybody is so fiercely independent.
And because of that lack of
understanding of the process, and,

(27:00):
you know,
obviously some that we're being
or ganging up on your,
your people, which we're not,
you know, and I've had a hobby beef business,
you know, all that kind of stuff.
And I'm all about steak and whatnot.
If you told the
soybean grower in Illinois,
hey, listen,
I know that you're a conventional grower,
and I'm not trying to ask you to do something
organic, you know, tree hugging stuff.
But there's an extra $0.48 a bushel

(27:23):
if you can make the
if you can grow
these people
like soybeans,
you're not going to take a yield hit,
but you're going to make this change
between now and the time
they got to the end of the driveway,
they'd have already made the change and say,
I'll do what I can to pick that up. $0.48.
If you told the beef people,
you're going to make an extra $0.48.
And it's to do this,
they they would dig their heels in

(27:43):
and to try and spite you.
That's my that's my experience with the beef people.
I couldn't agree more.
And I grew up in this industry and I love it dearly.
Yet that's why Jeff and I are doing
something different,
because we looked around and we're like,
this ranch won't look the same for us.

(28:04):
Our our skill sets different.
Our what we
what we bring to the table is incredibly different
than, you know, my dad,
which he's wonderful at what he does.
And and he's made an incredible business out of it.
Yet we have a different skill set.
It's a different time.
It's I didn't want to fall into the trap of
what we're going to keep doing it this way,

(28:24):
because it's the way grandpa did it.
And that is historically
the trap is a lot of industries,
but the beef industry for sure.
I've talked about the inconsistency of product
before with, with beef. I'm sorry.
I want to get into that before I do
I want to remind my listeners about Truterra.
Truterra has been a business partner.
They're, they're helping the farmers
make the sustainability plan work.

(28:46):
In other words,
if you own acres,
if you farm acres, you're going to figure out a way
to diversify your income.
Commodity prices are at a low.
You know this. You obviously live it every day.
So why don't you look at diversification of revenue
through a program with true terror?
You can figure out how to get sustainability money.
Maybe it's by cutting back on your fertility inputs.
Maybe it's by capturing nitrogen
rather than applying more cover crops.

(29:07):
Reduced tillage.
These are the kind of things
that probably,
I think
you're eventually going
to have to do per USDA rules,
because sustainability
and nutrient management plans are going to become,
I think, a component of all USDA programs.
That's just where I think things are going
from an environmental standpoint.
Get ahead of the game, go to to TruterraAg.com
to learn more about applying
for some sustainability programs,

(29:27):
which are the future of diversification of revenues.
There's something about the inconsistency.
And I brought this up once and I said,
you know what?
I just said this
yesterday, on stage to an ag audience,
if you eat a banana,
I give you both a banana.
And at the end I say, how was your banana?
He's like, what the hell you talk about, it’s
a banana?

(29:47):
I mean,
unless it's green or overripe,
there's no variation between a banana.
But if I said, how was your steak?
And that speaks to the lack
of consistency in the product.
I'm not saying the feed yards produce a bad product.
I'm not saying that
the big four produce bad product,
but there is a variability and an inconsistency

(30:09):
in beef that might be greater
than almost any other food category
that I can think of.
Am I anchored in my perception on that?
I would say that in a lot of facets, yes.
But, you know, my kids are a prime example.
They they know our beef.
Yep.
Frankly, they won't eat any other beef

(30:30):
they just won’t Right.
But also they're the same way
with like a raspberries.
There's times that I bring home
a set of raspberries that they love
and they eat the whole carton.
And there's other times
where some of them are sour
and they're like, oh, I don't
I don't know about that.
But if you get a box of Cheez-Its,
they taste the same every time.

(30:51):
So there is something about that across industries
that that consistency.
The back to your question.
Yes, there are a ton of inconsistencies
within the beef industry.
One of the nice things
and I want to throw it out there.
Then we hear Jeff's on this
because he's more like me,
maybe a little bit more of an outsider from you.
While we have the big four processors
that almost every beef that is, every,

(31:11):
what, 90% of the pounds of beef that are consumed
United States goes through the big four.
Is that roughly a good number? Even more probably.
I think it's 85 is the last number I saw.
But if I excess of every pound of beef
that an American consumes comes from the big four,
they they are all the same.
But I think the inconsistency comes about from
we got the average cow

(31:32):
calf operation is 31 cows or something.
And it's a part time job for the guy and his wife
that have jobs in town.
They've got 80 rough acres or 120 rough acres
and they want to keep.
So what I attribute it to,
and I want the experts like you to tell me
the inconsistency
is derived by the fact that there's
a whole bunch of small players

(31:52):
that aren't even really in it for the money.
They've got 27 cows,
and so they're not going to all of a sudden
get on the same genetic plan as you are.
And so therefore there's all these different small,
small operations that feed into the system,
and they're not on the anywhere
close to the same playing field.
That's one of the reasons I think.

(32:13):
I think there's definitely
genetic variability and care.
And I've talked about that.
What I think really back to your original point
about the starkness of some of the beef people
to be very,
close minded in their thoughts
within our within our system.
Kara has implemented genetic testing,

(32:37):
genetic tracking
all the way through the harvest facility,
where we could offer that
back to the cow calf producer as a value add to them
so they can make management
decisions based on what we're seeing.
Generally speaking, they're not interested.
So you could Kara he just said the exact thing.
Hey, we've got genetic testing

(32:58):
and we're looking at quality attributes,
and we are now a processor. You are.
What's the company going good.
Colorado, Colorado, craft beef, Colorado craft meat.
And you could go to a supplier
because you don't supply all of your own stuff
or even
let's say I'm down the road, I'm
I'm ten miles down the road.
And I say, hey, I'd like to get an upcharge
and I'd like to put my stuff to you.
And you say, great,

(33:18):
bring in one of your best steers.
And then you look at it and you say,
you know,
this is an okay steer,
but we can make it better with these, changes.
Yeah, I am interested.
That's like saying I want to give you more money.
Well, I don't want any more money.
Well, the the what?
What happens
is we say,
hey, do you want to retain some ownership?

(33:39):
Would you like an opportunity to earn a premium?
We can give you the data back.
And they said no, these are great cows.
Just pay me because they all raise the best calf.
Yeah. Every one of them.
Right? Right. Yeah. They they they great.
They great Prime and, there's nothing
there's nothing quite like them. Right. Yeah.
And they all gain. Great.
And then every sick, every sick,

(33:59):
they operate on 3.8 pounds per day, of gain.
And they,
they all great, of course, but that's not true.
I will be I will be right back Damian.
That's fine.
What about, Kara,
the the the direct to consumer growth?
You grown up in it generationally
when your grandparents were around.

(34:20):
Yeah.
They butchered for themselves
and the neighbor's butchered for themselves.
And maybe your cousin in town
got beef off of you because they were from the farm.
Then obviously,
we kept getting more and more urbanized
or suburban ized.
And I do direct to consumer.
I did it for 30 years.
My hobby beef
is I still grab a few steers from my buddy and
and parcel them up between me

(34:41):
and, you know, 6 or 8 of my friends,
because that's how we like to have.
Or I always want to make sure
that a quarter beef in the freezer,
we went away from that
and now we're going back to that.
So
the direct to consumer as it looks
now is even different
than it was just ten years ago.
20 years ago,
it was this guy's going to buy
this guy and his wife and kids

(35:01):
are going to buy a half a beef off me.
Now it's direct to consumer, as in, you can buy
40 pounds of burger. You can buy,
you know, eight steaks, whatever.
Talk to me about the evolution of this
from your perspective is very different now
because it was as you mentioned,
you're like,
I really want to have,
you know, a quarter
or a half in my freezer at all times.

(35:21):
So I know that I have the highest quality beef.
It's right here. I can always go get it.
The consumer now
is seeing that very differently
because most of them, you know,
whether you live in a high rise
and you may have about this much,
you know, a very small freezer space for beef.
I still want to have that connection.
Yet it is a very different reason to purchase

(35:42):
that way.
Now, you know, it was more security
knowing what you're feeding your family
kind of a different thought process
to a consumer today of knowing
that they have that convenience or,
however you want to, to talk through that.
And I saw a we saw a massive shift during Covid
because of course, everybody was like,

(36:03):
oh, we just go to the grocery store.
We know it's always there.
And all of a sudden it wasn't.
And our generation has never seen that.
So a lot of the generations grew up,
you know, in times of famine
or war
and wanted to make sure
they had beef in their freezer.
And now that a consumer saw that,
it is much more forefront of mind of,
oh, I may not be able to get this,

(36:24):
let me make sure that I have a direct line
to the people who's producing it,
because I'm not and I don't have a grandpa
who does it anymore,
or I don't know, the guy down the road
who's selling beef.
It's it has kind of circled back to that.
I would do they.
Jeff, do you have any additions to that.
Yeah.
The the direct to consumer I love it.
I mean, first off

(36:44):
I've been preaching it to my people.
We live in an era more than more than ever.
Consumers didn't buy food on the internet
when the internet came out in the 1990s.
Then they started, what,
ten, 15 years ago buying shoes online or some,
you know, innocuous thing, a sweatshirt, whatever.
And we started buying food online.
And in the whole Covid thing,

(37:06):
like you said, changed it remarkably.
You can max, you can add value.
You can, as you said,
retain, some now of the value chain on your own.
You've got a better opportunity
than you've ever
had to do this,
but it still caps out at a certain amount
to Jeff's point.
10,000 cases of wine and below.
Yeah, you're a you're a niche player,

(37:27):
but if you're not at least 40,000,
you're also not in the big leagues.
You can't be out of a certain level of
direct to consumer. I think.
I think in a lot of
areas you may,
but it's going to be based on harvest capacity.
Can you get slots etcetera, etcetera.
Or are you in a region
that you can only ship so much,
you know, if you're in a really heavy

(37:48):
shipping region
and you constantly get bumped on ups,
for some other manufacture or,
you know, maybe it's a,
yeah, a goods manufacturer, like, or,
automobile manufacturers up in Ohio
and you're trying to ship out of Ohio
and you're competing with that freight,
you're going to have a problem.
I think that's the biggest issue is UPS, Fedex.

(38:11):
Any of the shipping companies
have seen such an expansion of shipping
from all the direct to consumer products or Etsy
or any sort of other marketplace.
That's not brick and mortar.
Those systems are flexing in a way they've
never had to. And
I don't know that
I think we
will run into a capacity issue,

(38:32):
but I think that's quite a ways out.
I think I would say the capacity is less your issue,
meaning me,
the ability to produce or harvest or package,
I think it's going to be the consumer
runs out before your capacity does.
There's only going to be so many consumers
that want to buy direct
to from producer and pay a bit of a premium for it.

(38:54):
So it seems to me the limitation is more on.
There are plenty of consumers
that want to spend more.
I point this all the time to my
my ag people that are commodity minded.
They only care about cheap.
Well, if that's true,
they wouldn't pay for bottles of water
because water's free, right?
So I don't agree with that.
Am I thinking right here?
I think the limitation is eventually
what 10% of the marketplace is.

(39:16):
People like us that will pay a premium
because I sure as hell would pay a premium.
And I'd drive up to Northeast Colorado
if I had to just eat, the Kroger, meats, beef.
I would say you
would get to, a price point threshold.
But that is where beef is always played
in a different market.
You know,
it's a lot of the other
proteins do get to a price point

(39:38):
that people will shift away.
But beef is one of those
that continues to stay strong.
Joke
we've made before,
which I still think is very valid,
is there's no such thing as a chicken knife.
I mean, there's a reason we have a steak knife.
And that's the the piece of it
that as, as people continue to

(39:58):
have more expendable income.
I mean, we already spend
such a low percentage on food in this country
compared to other countries.
I'm not sure I could say even with the last four
years of rampant food inflation, we're still well,
we're more
than we were getting around around 8.9,
I think, percent of median income.
I'm not talking about the poorest
among us on the top of the richest

(40:18):
among us, but on average, because it's always tough.
You know, the rich people don't spend hardly
anything on food on a percentage basis,
and the poor people spend an outsized
I think we're around 9%.
And now this food inflation has made it.
I think we're more like
we're spending 12 or something
percent of our on average of our income on food.
So
but which is significant cause
we hadn't seen a food price

(40:39):
increase year over year over year
like we have the last several, since the 80s.
I think the other thing that's really opening
the minds of consumers,
especially in the food front,
not just beef, but food in general,
during Covid.
Restaurants were shut down,
people invested in cooking,
they invested in learning.

(40:59):
Gordon Ramsay
has so much content out there, you can.
Bake, you know, osso buco at home out of a very low.
And that level of data sharing and information
sharing in the marketplace.
And people that have invested in a $1,200,
you know, kamado style
grill have realized
that I can get a better steak at home.
And I don't need pants.

(41:20):
So there's a market shift,
I think, in how people want to consume the product,
where the ultra high end restaurants do really well.
But I think some of the median level restaurants
are being surpassed by people cooking at home.
You know, and that may be short lived too.
So I well, I, I'm not a normal consumer.
I mean, I've grown beef

(41:41):
I've and I'm different than many. Yeah.
And also from a socioeconomic background etc., etc..
I would if I'm traveling and I have no choice,
I might eat and, an Applebee's steak,
but meaning, would I leave my house
and drive to our Mr.
A steak,
or just get myself a good one and cook it myself?

(42:03):
There's not a
there's no chance that, yes, I agree with you.
Whereas
you might have something about this thing, Kara,
on the the longevity of it.
You've got some people coming into it.
You got an outside investor
that's kind of who got a famous name
that's putting money into Colorado Craft beef
is this is is this another thing that's a craze?

(42:25):
I mean, this is another fad.
You know,
Tom Brady, Tom Brady was an investor in a company,
went kaput or,
you know,
you see this thing
other other famous people were in.
The dotcom thing is investing in direct to consumer
agriculture.
A hot thing right now

(42:45):
for outside ag people, or is it going to stay here?
I think there's a piece of that going on from,
from an investor's perspective of like,
hey, if we're going to invest in something like,
why don't we invest in what nourishes
our body and our family's body?
So, you know, from from that perspective,
I think that is something to consider.

(43:05):
And that's, you know,
and investing
in our American supply
chains is another piece of that,
making sure
that we can produce what we need
to feed ourselves in this country, which has moved.
We've kind of moved away from that thought process.
Jeff can touch on some of the economics of,
you know, the, the
why from a lot of big money moving into agriculture.

(43:30):
He can be more in-depth in that.
But I would say from, you know,
the philosophical perspective,
it makes sense to invest
in where your food comes from
and the people that are producing your food
to make sure that you continue
to have access to that.
Jeff, I,
I applaud it, by the way, and I know what I mean.
I can I can be critical about certain things.

(43:52):
But I also
I can tell you the things
that I'm, applauding I'm
aapplauding direct to consumer.
I was direct to consumer.
I'd buy from you guys. Absolutely.
All those things,
I wonder, though, is it a trend right now to say,
hey, you know what, Covid to us, that
we need to make sure
we have more of these direct to consumer people.
We need to make sure that we've got different
supply chains.

(44:12):
I mean, there's a little bit of enthusiasm
and then there's a little bit of a panache.
Hey, you know what I mean is,
does it have staying power?
I think with the
current political economy
or the current political climate, it does.
I think RFK Jr's going to help quite a lot
to drive some of that.
But I think a lot of it is more even health driven.

(44:35):
If you follow people like Doctor
Sean Baker
on the carnivore diet
side, or people
trying to get away from processed food,
or RFK talking about getting away from seed oils,
that all drives itself to direct to consumer,
whether it's in beef or the statues or whatever,
because people have a

(44:56):
and I'm not speaking for everybody,
but it's my opinion
that the general consumer,
especially the more educated general consumer,
has a natural distrust
for anything in the middle of the grocery store.
Yeah. Rosalind Russell yeah.
And so that that doesn't help you as much
because they the, the fresh the fresh stuff

(45:16):
and the meat stuff and all that tends to
I was it's always on the perimeter
and it doesn't have as much mistrust.
But yeah you know, you're right about the
just just released an episode about the RFK thing.
And I asked would RFK Jr un-fauci our food.
And I don't mean
that Fauci was directly involved our food,
but fraudulent science being used to,
to create profits or advance political positions.

(45:40):
Doctor Ansel Keys was the Fauci of his time.
I, I think that RFK Jr.
Certainly he's got some problems and some warts.
His organic zealotry, his, problem with glyphosate.
But he's actually calling out processed food
for what it is
and all that low fat nonsense
that we were suffering for 40 years

(46:01):
and told that saturated fat
was going to kill us, which is all bullshit.
I covered that with Nina titles in the past episode.
Go check it out.
Great book, by the way,
to give you a oh, you like that?
Yeah, that's a great book.
You like the do you like the,
the, prospect
that RFK Jr
somehow is going to be good for the beef business?
He talked about beef tallow
being better than seed oil.

(46:23):
I would say yes is the short answer.
I do think, as you mentioned,
there's some things that may need to be considered.
Yeah.
Would you give up glyphosate to, Would you give up?
Are you willing to give up glyphosate to have RFK
be a cheerleader for beef and beef tallow?
And that's not quite my camp,

(46:44):
so I'm going to step out of that one.
I don't want to speak on something that,
frankly doesn't impact my business.
So, yeah, we are fortunate that soybean,
in Illinois,
you've got a pretty big vested interest.
So I say go back to, what I think.
And I think this is the interesting conversation,
especially with glyphosate,

(47:04):
is do I think we should continue
using glyphosate forever? Probably not.
But I don't think we have a better solution.
And if you wave the magic wand and glyphosate
goes away tomorrow, what are we using? Grim oxen?
I mean, yeah,
harsher, harsher stuff.
Way harsher stuff.
And I think that
that is the thing
that Kara and I try to do within the company,

(47:24):
not just for beef,
but for farming for people in AG like, hey,
if we're going to rip the Band-Aid off,
that's cool, but it might be gangrenous
and it might fall off.
Like, let's let's make an informed decision.
And, you know, we are fortunate that we don't use
chromosome or excuse me, we don't use glyphosate
because we don't farm.

(47:45):
Right.
But,
but do I think that,
you know, the corn in our region is bred for sure?
Yeah.
By the way, Jeff gets kudos.
380 episodes in the can.
And that's the first one.
The, evoke the word gangrenous.
Anyway.
Can I, ask you then about your business?
Because I'm a fan, I am not in any way being harsh.

(48:09):
I'm more saying,
I think that the market is
limited to a certain point.
I don't think we're there yet.
I don't think direct to consumer on any ag stuff.
Is there yet?
The internet is still alive.
The, desire, like you said, the RFK,
it's not just him.
There's a following.
And that's part of his activism.
And part of the activism was already there.

(48:30):
And I'm not talking about marching
at Monsanto and glyphosate anymore.
I'm talking about local.
You know, it's been going for a while.
I wrote about it in my book,
how I've this book came out five years ago,
and I talked about adjectives
that sell local is one of the big ones.
I don't think
we're there on saturation by any means.
And I think there's still plenty of consumers

(48:52):
that will pay more,
as opposed to our farm people
that think it's all about be cheap, be cheap.
Like, no, you're cheap.
You think everyone's like you, Farmer Roy.
But guess what?
They're not a bunch of bunch of consumers
will want to spend more.
That's why Whole Foods as remember
the lay of 2000 stores nationwide.
Where does it go?
Direct to consumer.

(49:13):
Where does beef go?
21st century
I think beef direct to consumer continues to expand.
What I am worried about for the industry is
I think a lot of the direct
to consumer beef producers are not being honest
with themselves about their own economics,
because at 30 head,
you're not going to make it work. Right.
And and they think getting big is evil.

(49:36):
And I, I understand that concern.
But scale pays the bills
or diversification pays
the bills
where I get worried
with some of the direct to consumer folks,
we only sell haves
because we don't want to deal
with the rest of the sales process.
I'm like, well,
you're naturally limiting your sales funnel.

(49:57):
Or, you know, something we've done this year?
We launched beef snack sticks,
we have summer sausage,
we have pet treats from organ meats,
we have tallow, we have whipped tallow.
We have bratwurst.
We are wait wait wait wait wait.
Kara Now, listen, I'm all about
You beef people are fine.
I like, know bratwurst is a pork product.

(50:17):
Stay in your lane, Kara.
We label beef bratwurst.
There's no.
This thing is like a Beef bratwurst is like.
It's like a turkey burger.
There's no such goddamn thing as a turkey burger.
The other thing is a beef bratwurst. Come on now.
Okay, we got to get with the marketing guy Kara.
All right, another couple of thoughts on this.
From the standpoint of, shipping.

(50:39):
You know what?
And if I'm, a big for
I just I just have reefer trucks lined up,
coming into Dodge City
and taking out reefer trucks
when you're your size,
if I want to buy your stuff and I'm at my winter
home down here in Phoenix,
Arizona, I'm going to pay exorbitantly to get it
delivered to me,
because I have to keep it
in a styrofoam package
with dry ice to get it to me, don't I?

(51:00):
Nope.
We use spun corn fiber insulators.
You're welcome
to help those, those central Midwest farmers
appreciate it.
We use recyclable and and safe ice packs
because where we live,
we can't get, dry ice at scale.
Okay?
We have shipping included in all of our pricing,

(51:20):
which we know shipping is not free.
So I'm not going to say that right.
But the bigger thing is to my previous point,
we are at scale.
We have negotiated rates with UPS.
We have negotiated rates with Fedex.
We know where we can ship to.
We've optimized,
and then we have
built the economic system of the company
in such a way
that we can ship to Arizona

(51:41):
or Florida and still be in the black. Got it.
And that is not an easy lift.
We probably spend 2 or 3, 2 or 3 hours
a month per person
talking to competitors of ours
across the country, trying to coach them
on how to
do that, because
that is the hardest part of direct to consumer.
Unless you want people at your house every day

(52:01):
and that's a pretty small population
that'll do that.
Well, that's the thing.
Direct to consumers, a cute idea.
Again, you know, the people that live
in, the affluent suburbs and say things like,
well, you, you have farmers markets.
I'm like, oh, really?
Do you go to a farmers
market on,
Saturday morning when it was 14 degrees and snowing?
No, you didn't, did you?
So I'm supposed to stand out there
and freeze and sell for $4 worth of stuff,

(52:23):
and it doesn't work right here.
I call it a beef.
In the 21st century,
we've we haven't really given me a big outlook.
So before we hang up three big predictions
for beef in the 21st century,
it'll be about direct to consumer
for me about the big four packers.
It can be about consumption trends.
Give me the three big predictions.
One at a time
I'll go between you and Jeff
that make it easier on you.
Prediction beef on the 21st century.

(52:44):
I've got mine. I want to hear yours.
So I'm going to start with beef consumption.
I'm going to call it mindful consumption
because I think that
when we look at the political landscape,
we look at direct consumer,
we look at a lot of these
kind of groundswell of let's call it health.
I think there's so much more push towards
Whole Foods consuming,

(53:06):
consuming dietary protein in general.
So I would say as far as beef consumption,
I would I would look at that continuing to rise
because people are going to invest
in that protein more heavily.
You know, not necessarily
any protein, but in general,
if you're going to go has a really,
you know,
having fat and protein in one spot,

(53:29):
your beef is where it's at.
I agree with you.
And,
since all the goods remain in it, we'll go to Jeff.
I absolutely agree with you
because the, the
the groups, they're trying to either
control what you eat or make money, like the Bill
gates scumbags of the world
where they want to sell synthetic beef.
Have tried to pretend that beef is not healthy.
And that's where again, the RFK singing

(53:49):
so actually is helping
because like,
no beef,
real beef been consumed by humans for,
essentially domesticated cattle.
So I agree with you.
You said it's going to increase consumption.
I think the price point is going to not allow it.
I believe it will remained,
I believe will remain steady.
I believe will be at steady.
I don't think we won't increase.
But anyway, those are my thoughts, Jeff.
I predict that in the 21st century,

(54:11):
the economic opportunities for cattle producers
is going to be better.
With the technology increases we see on selling
cattle on actual price
discovery combined with pressure on the big four.
I think savvy producers that stay on the market,
that really do their diligence as a businessman,

(54:32):
not as a rancher business.
We're going
to Arizona, phone
to excuse me, as a solid business person.
There you go.
Will have more opportunity
than they've had in recorded history
for good business value.
Yeah I agree, but no, but they have to work for it.
And that's the hard part.
Yeah. Right.
Well again it's not going to be the person that just

(54:52):
hey you know what? I'll do it.
I do, you know tell me what to do.
Yeah I agree with you.
It's going to be the business minded producer,
which isn't all of them,
which in fact is not not as many as it should be.
Kara, beef in the 21st century.
I would agree with you and accentuate with that one.
Your second one.
So this can dovetail into what Jeff said.
But I would say if we look at the beef industry,

(55:14):
which course
on lumping the cattle industry into that as well,
I think you'll continue
to see consolidation on the production side.
And why I say that is the producers
that look at it as a legacy business
instead of just the fact that they have legacy land
or legacy ground in their family.

(55:36):
It's going to continue to grow.
And the ones that look at it
from a business perspective
and they focus on their actual business
and the legacy of that
are going to continue to excel.
And the others will get left behind.
Yeah, Jeff, your second one.
I think there's going to be some massive market
disruptions from regulation.

(55:59):
I think,
you mean like regulation on,
environmental regulation
should be on on it on the size of producers.
I think it it,
you know, something environmental
out of California wouldn't surprise me.
And that would totally change
the national landscape.
Okay.
Because when people ask us,
what's your biggest worry?
I'm like, man, regulatory. We're in Colorado.

(56:20):
It's a blue state.
Yeah, dude,
that wouldn't
surprise me
if in the next decade,
our harvest facility was deemed
unable to operate by statewide regulation.
It wouldn't surprise me.
It's not humane enough or,
it doesn't have a square feet or something.
All right, I ask you each for three.
Im gonna throw out mine.
And then I want your comments on it as your third.

(56:40):
I predict because of this movement.
Now, the, the I've been hearing since the 80s
that beef was bad for you, and beef's held up.
Then we heard.
Then they switched to the. It's not humane.
It's not true.
So the consumer absolutely is tuned that out.
Then they went with
cows are killing the environment.
That one persists only among a very small, vocal,

(57:01):
very well-funded activist group
that I believe actually is more sinister.
It's gets backed
by people like Bill gates
that want you to eat their shitty synthetic meat.
And that's why they continue
to foster and promote and perpetuate
this falsehood
that cattle farts or burps are killing environment.
I blew the beef remains viable,
and I actually think it's got an uptick.

(57:22):
But I predict fewer cattle and feed yards ten years
from now
than there are right
now, and more marginal land convert because of water
because of our oversupply of commodities.
I think that more beef will be out
all the way, maybe even finished on rangeland
and grassland
and on what is now marginal farmed acres.

(57:43):
I think ten years from now
there's fewer
fewer animals that are in feed
yards, additional feed yards.
But consumption stays the same.
Those there will be more animals out
taking them all the way to butcher,
but not on grain. That's one of my position.
And I think the environmental play works
on that carbon
sequestration, the growth and regenerative
farming ideals.

(58:03):
I think that's where it goes.
Do I am I am I out on a limb here, Kara?
I can see it with a certain subset.
The only thing that that comes to my mind
from economics is,
you know, we're going to have an additional
at least a year on the life cycle of those animals
and the amount of animals we have growing fast.

(58:24):
Exactly.
And the amount of animals we have right now
as far as consumption,
I don't know that we can sustain that.
But if a consumer continues to demand that
that could happen right
now, that's being taken up with import,
you know, that that subset is of beef production.
So if we we change, as Jeff mentioned,

(58:45):
some of the laws within
whether it's import laws, export laws,
anything in this country that changes that dynamic.
And we need to take that up
in the U.S, I could see that happening.
Jeff.
I could see it starting to happen,
but I wonder

(59:07):
I think there would have to be a middle ground of
like a cover crop
where you're getting that concentrate load
so you can get the white fat
so you can get proper aging.
So people get the beef flavor they want.
Yeah, yeah.
That's why I you and I'm not I'm not rah rah
grass fed.
I just about
it seems to fit
a lot of where things are going on
the regenerative movement on the
on the lesser acres being taken out of production

(59:29):
because of environmental reasons.
They're environment
sensitive groundwater, Ogallala aquifer,
all those kinds of things.
And that's where I was going with it.
What about to, to hear his point?
We don't have enough beef numbers.
If we take six more months to fatten up a steer
because of changing some of the methodology,
you know, meaning i.e.
not doing feed yard as intensively you throw,
she said.

(59:49):
12 months.
I think maybe we just
we don't take a the 600 pound day more.
So maybe.
Yeah, at six months
we ain’t got the cattle right now to do it.
We don't.
And then the flip side to
that is the genetics we have today in the beef
cattle world. Kara can speak to this.
I don't think they're going
to get to a natural endpoint on grass
that people want to eat.

(01:00:09):
They won't yield.
Your cost per pound is going to go through the roof.
And on top of that, you know, we've been
I forgot the exact number, but I think since 1984,
heifer carcasses have been
going up on average of 6 pounds a year.
Steer carcass has been thrown up
by an average of 5 pounds
per year in that time frame.

(01:00:31):
Those
genetics are built for grain finished cattle.
So and that's a huge percentage of the market.
That begs the next question.
Do we change the Jags.
We change the Jags on chickens.
We change the Jags on pigs.
They used to finish at 210 pounds.
Would be skinny as a rail.
Another 285 pounds.
And it built like a bodybuilders.
We change the genetics to make it
so that we have more beef

(01:00:51):
that are grass finished friendly,
and they finish at 1,200 pounds to 1600.
Yeah.
If we're going to grass, finish,
I would say we have to.
I mean, because they have to reach that endpoint
before they could actually start laying down
back fat and have started a consumer.
So I can go ahead and start
ramping up my Murray Gray,
my Murray Gray herd is what your tone maybe.

(01:01:13):
Yeah.
But and I think,
you know, to our point about the big four,
the big four won't be able to compete in it.
No, no, it won't be at scale.
So if there is a way to disrupt the big four,
it's somebody like us
moving into something like that
that the big four can't touch
until it gets to critical mass.
That's the thing, is that the Big Four
eventually become niche players.

(01:01:33):
Also, when the niche is big enough
for them to occupy it, right?
So anything that happens, they're going to
if it if it happens in any scale at all,
then it becomes what they do right there.
Right? That
his name is Jeff Smith.
Her name is Kara Smith.
Last thought eight seconds on the way out the door.
Kara,
Since you're the generational person right here,
which I believe is the 21st
century, it's been a fun talk for you.

(01:01:54):
It went longer than I thought
because you know what Jeff said?
Hey, man, I got things to do.
I said, oh, we'll get through this in no time.
I love this topic because I like steak
and I love talking to you guys,
but you're smart and you're forward looking
and you're looking at
how you can advance yourselves.
I love it, love it, love it.
What's your prediction
for 21st century for Colorado craft beef?
I predict we continue to grow,
but we also continue to evolve in our mindset

(01:02:17):
and keeping our our customer at the center
of of that conversation,
but also the business as a whole.
That's one thing
that Jeff and I talk about a lot is
this still is a business.
You know, we're in the business of beef.
We're in the business
whatever side of our production chain.
And the more that we focus on
on that and producing that product

(01:02:38):
that our consumer wants,
the the brighter the future looks.
By the way, Jeff,
she didn't remind me at all
of so many people I talk to in the beef industry.
She talked about the customer and and in answering,
demand and and giving them what they want.
What the hell's wrong with you people?
Did you not get the memo
from the National Cattle and Beef Association?
You're supposed to do whatever, the they,

(01:03:00):
they tell you to do,
you know, it's screw the consumer.
They the, the big four.
Don't invite us to those meetings.
I'm only I'm gonna leave it right there.
That's all you need to say. We're close.
I'll have the big four
to invite him to the meetings.
All right. His name is Jeff.
Her name is Kara, they are the Smiths.
If you want to find out more about their business,
you want to buy some of their stuff.
Where do they go?
ColoradoCarftBeef.com.

(01:03:21):
You can find us at Colorado
craft beef on all socials.
And when you're looking for that next update
on your mindset, follow that Jocko podcast.
That guy helps quite a bit too.
Okay. Jacko is one of their investors, by the way.
That's who we talked about there outside investors.
Jocko.
He's the famous podcaster workout
former marine, right.
Navy Seal man.
They would say be careful Damian.

(01:03:42):
Yeah, right.
I'll get those guys pissed off each other.
All right.
So anyways, ColoradoCraftBeef.com.
These guys are awesome.
I really appreciate them being on.
I got this connection through our friend Catherine.
. And she's okay too.
But anyway, I mean, she's she's she's,
let's face it, she's she's
she's the reason we're all here.
All right?
Catherine's, we're all. We're just loving it.
All right, till next time.
Thanks for being here.
Check out my friends at Truterra.

(01:04:02):
Also Redox,
Redox Bio-Nutrients can help
you produce more with less on your crops.
And I think you're really gonna need to do that
in the year ahead.
And also for my friends at Pattern Ag.
Till next time, thanks for being here.
Thanks to them.
You'll check out their website
and and you know, see
if you can buy some of that awesome Colorado beef.
They produce too. Till’ next time.
I thank you for being here.
My name is Damian Mason,
and this is the business of agriculture.

(01:04:23):
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