- (Focus Area) Economic Development
- Author: Dan Macon
Last weekend, much of the Sierra foothills was impacted by another PG&E Public Safety Power Shutoff (or PSPS, as the company calls it). This time, the advertised windstorm actually materialized - and while shutting off the electrical grid probably made sense from a wildfire prevention perspective, PG&E's actions had unforeseen consequences for many foothill farms and ranches.
For customers of the Placer County Water Agency, the power shutoff meant no American River water during an especially dry period. Citrus growers, especially, are entering a critical timeframe in the ripening of this year's mandarin crop. Many livestock producers rely on winter water during this time frame to provide drinking water for livestock - others pump groundwater for livestock (which is difficult without electricity). This week, I've been filling a water tank in the back of my truck to haul water to our sheep.
In the coming month, we will be working on a comprehensive survey to document impacts to farmers and ranchers. In the meantime, we want to know if you've been impacted by lack of water (either for irrigation or for stock water). Please take a few minutes and complete the following survey:
http://ucanr.edu/oct19livestockwatersurvey
Thank you! If you have any questions, please contact me at dmacon@ucanr.edu or call the office at 530/889-7385.
- Author: Dan Macon
Direct marketing, for some farmers and ranchers, can be a way to capture more of the consumer dollar. By bypassing the middlemen - wholesalers, distributors, and retailers - direct marketing can allow a producer to receive retail value for his or her product. But direct-market meat is a different story. Direct-market meat requires substantial processing - the harvest and cut-and-wrap services provided by processing facilities and butchers require significant skill and capital investment. Over the last 50 years, we've lost local meat processing capacity - small local butchers simply don't exist in very many places. Many of us assume that increasing this processing capacity would solve the problem. In my experience, the solution isn't quite so simple. As someone who has marketed meat directly to consumers at a modest scale (120+ lambs per year at our peak), I have observed a variety of complicated questions regarding the real issues involved increasing harvest and processing capacity.
As a small producer, I wanted the ability to call a plant one week and deliver animals the next week. However, most of the small plants in our region are fully booked as much as a year out. A new small plant would be similarly impacted eventually – and from the perspective of the plant, it would be easier to have 10 clients bringing 200 steers (or 500 lambs) per year than to have 200 clients bringing 10 steers (or 25 lambs). In my mind, the only way to address this need for scheduling flexibility for the producer would be to build a plant with excess capacity, which is not economically efficient. This excess capacity would allow me to call the plant on Thursday to schedule a harvest, deliver my lambs the following Sunday, and have packaged meat by the next Friday. If the plant were running at capacity, it could not accommodate me.
Seasonality is related issue, in my mind. Grass-fed meat is a great opportunity for some producers, but typically not a year-round product for many small-scale ranchers. What will a new plant do to keep its crew busy on a year-round basis? I think this is another factor that pushes plants to find fewer, larger-scale customers.
Meat processing has largely been organized on a manufacturing model. The plant buys the raw product (livestock), converts it into meat, and then sells it to distributors, wholesalers, consumers, etc. The model we're talking about is a service model – the plant has to make money on the service it provides rather than adding value to product it owns. That's a very different model, one that is a struggle for existing operations (let alone new ones). For example, when we started with our regional processor, we could get a lamb harvested and fabricated for $50/head. The company soon realized that the cost of providing this service was much greater than the cost of the labor involved – they had to deal with 100 or more operations like mine that each wanted to harvest 10-15 head once a month. The cost is now $120-130 depending labeling and other factors. This is reflective of true cost of providing a service rather than selling a product.
Despite the interest in new processing capacity locally, there has not been any significant financial commitment from local citizens or producers towards the construction of a facility. This is where the rubber meets the road. And I suspect that this is the crux of the issue – there are both regulatory and economic barriers to entry in the meat processing business. The low return on investment for a service-oriented meat processing facility may make the economic barriers the more difficult to fix. I think if the economics were positive, we'd see private investment in new USDA-inspected processing capacity.
Alternatively, we may want to consider focusing on the regulatory barriers. Along those lines, a couple of things come to mind for me:
- There are inspection-exemptions for direct-marketed poultry based on scale of operation. In some circumstances, a poultry producer could harvest as many as 20,000 birds a year without USDA inspection and sell the meat directly to end users. No similar exemption currently exists for livestock.
- There was state legislation adopted last year making it legal for cattle producers to sell a live animal and for the buyer to then arrange for harvest and cut-and-wrap. There has been some confusion as to whether this new law applies to other livestock; the California Department of Food and Agriculture (CDFA) is taking the position that it only applies to cattle since cattle producers pay for an ownership inspection (e.g, brand inspection) at harvest. There is interest among other livestock groups (California Wool Growers, California Pork Producers, etc.) in extending this option to other species.
- CDFA could provide more state inspection (for a fee, perhaps). This could facilitate direct marketing of meat products.
This is probably WAY more information than anyone wants on this topic, but I do think it's important for us to understand the complexity of the issue. I guess I see a couple of important needs:
- Economic analysis and extension – I think UC Cooperative Extension (and others) could help small-scale producers (and large-scale, for that matter) better understand the economics of selling meat versus selling live animals. My very simplistic assumption when I started was that I would be more profitable selling $350 worth of meat than I would be selling a live lamb for $150. Reality was much more complicated. I think there's a need to help folks better understand this question. Producing a finished product (as opposed to a live animal) at scale is a complicated production and economic model for most livestock producers. It requires a very different set of skills.
- Research-to-policy – I also think there is a role for extension and others to help regulators understand the opportunities and barriers involved in direct-market meat production. This runs the gamut from ensuring food safety to understanding economics to quantifying consumer demand.
Many of my extension colleagues - in California and elsewhere - have spent considerable time and effort examining this problem. Their work has been exceptionally valuable - we have a much better understanding of the complexity of these challenges today than I did when I started in the direct-market meat business more than a dozen years ago. Perhaps these questions are part of the maturity process - the early pioneers must expose the weaknesses in the system. Some of these weaknesses are economic; others are regulatory. I'm hopeful that we're making progress towards discerning - and addressing - the most critical barriers.
- Author: Dan Macon
As anyone who has ever cared for livestock at a commercial scale will tell you, animal husbandry requires a wide range of skills. Ranchers must be animal behaviorists, veterinary technicians, bovine (or ovine, caprine, etc.) midwives, meteorologists, accountants, irrigators, carpenters, mechanics, marketing specialists….
Where have you learned to ranch? How long did it take you? Author Malcom Gladwell suggests that mastery of any skill requires an investment of at least 10,000 hours – that's five years of full time work (or maybe three years based on how many hours most ranchers work). My friend Jim Muck, who farms near Wheatland and manages the Student Farm at UC Davis, says, “Farmers and ranchers have to be generalists. We have to have the ability to see patterns and make decisions based on what we see, hear, feel, and touch. We use skills that cannot be taught in a classroom, but must be learned by doing and experiencing.”
Like Jim, I find that I learn best by doing - hands-on training, at least when it comes to ranching, is usually preferable to sitting in a classroom. I also find that I learn best from a combination of rancher-to-rancher sharing and expert instruction. This kind of learning, at least for me, provides a faster return on that 10,000-hour investment. Our Winter/Spring 2019 workshops offer this unique combination!
Date & Location | Topic & Description | ||
January 9 UCCE-Auburn $10/person |
Farmer-to-Farmer Breakfast: Revenue Protection and Whole Farm Insurance Get to know other farmers and ranchers in our area. Enjoy a chance to relax and talk with other agricultural producers about farming and ranching issues. We will have a presentation on whole farm revenue protection and other crop and livestock insurance options from Domenic Fino of Golden Pacific Crop Insurance. RSVP: https://ucanr.edu/survey/survey.cfm?surveynumber=26336 |
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January 17 UCCE-Auburn $5/person |
Shepherd Skills Workshop: Sheep Management Basics Join other new and aspiring shepherds for an evening workshop on general sheep husbandry, production calendars, sheep nutrition, and economic analysis. |
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January 19 Auburn $5/person |
Shepherd Skills Workshop: Preparing Ewes for Lambing Field Day This hands-on workshop will include information on vaccinating sheep, ewe management, ewe nutrition, and general husbandry topics. Rain or shine! |
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Jan 31 - Mar 7 (Thursday evenings) UCCE-Auburn $50/operation |
Farm/Ranch Business Planning Short Course Join other farmers and ranchers for a 6-week, 8-session short course covering farm economics, cash flow management, operations planning, risk management, and marketing strategies. The course is on Thursday nights (6-9 p.m.) from Jan. 31 to Mar. 7, plus Saturday, Feb. 9, and Saturday, Feb. 16. The course is limited to 8 operations. Apply at: http://ucanr.edu/farmbizplanning2019 |
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February 12 Loomis $10/person |
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March 2 Auburn $5/person |
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Be sure to check out my Livestock and Natural Resources website (https://ucanr.edu/sites/Livestock/) and the Foothill Farming website (https://ucanr.edu/sites/placernevadasmallfarms/) for up-to-date details about workshops and meetings!
/table>- Author: Dan Macon
As a (relatively) new livestock and natural resources farm advisor, I'm fortunate to have known and worked with my predecessors (Roger Ingram in Placer-Nevada and Glenn Nader in Sutter-Yuba). I'm also fortunate to be working in a region where I've lived for most of my life. Even so, during my first year on the job, I've been conducting an informal needs assessment to determine the direction and focus of my research and extension program. And I've been learning a great deal!
One of the first things I realized in this process is that the breadth of geography, terrain and ecosystems in my four-county region is remarkable. The lowest point in Placer, Nevada, Sutter and Yuba Counties is 23 feet above sea level at Joes Landing on the Sacramento River (Sutter County). The highest point in my four counties is Mount Lola in Nevada County at 9,148 feet above sea level. Rangeland types extend from Sacramento valley grasslands and riparian habitats, through the vernal pools and blue oak woodlands of the foothills, through the mixed conifer belt and mountain meadows of the Sierra Nevada, and on to the eastside pine and sagebrush habitats east of the Sierra crest.
The livestock production systems in my four counties reflect this variation. The ranches in my region primarily produce beef cattle, sheep, goats, hogs and poultry. Operational size varies as well, from small-scale, part-time ranches to large-scale, extensive enterprises. Grazing resources range from annual grassland to irrigated pasture (valley, foothill and mountain) to mountain meadows to sagebrush steppe, as well as a significant amount of brush-land.
Ranch ownership tends to be somewhat less diverse (at least according to the 2012 Census of Agriculture). 86% of ranch owners identify as white, and 61% are male. My focus is on serving commercial livestock producers; targeted grazing contractors; land trusts and other nonprofits with an emphasis on rangelands; local, state and federal land and resource management agencies; and local community and consumer groups interested in local food systems and natural resource management.
As I said, my method for learning about the needs of the region was largely informal. Over the course of my first year, I met with a variety of ranchers, agency land managers, nonprofit organizations, and others. These conversations revealed three primary and interrelated areas of need for applied research and extension activities:
Based on these themes, I've initiated a number of research and educational activities, including:
- Research regarding specific rangeland drought management and response tools.
- Research and demonstration of tools for enhancing the productivity and sustainability of irrigated pasture.
- Research and demonstration of tools that help minimize livestock-wildlife conflicts.
- Development and facilitation of emergency planning and response tools (especially for wildfire) for commercial livestock producers.
- Development and demonstration of ranch business planning and economic analysis tools, including online tools.
- Continued development of hands-on livestock husbandry and grazing management educational programs.
- Research into and demonstration of grazing as a vegetation management and fuel load reduction tool.
I'm very fortunate to be working with extension colleagues within my region and throughout the state on many of these issues. One of the strengths of the cooperative extension system is this opportunity for collaboration and for tapping into cutting edge research led by our campus-based specialists. As I begin my second year as an advisor, I am working with colleagues on a variety of projects:
- We're starting a 3-year study into the economic and ecological consequences of weaning calves early as a drought response strategy. This research will be conducted at the Sierra Foothill Research and Extension Center.
- I'm leading an ongoing effort to better understand the direct and indirect impacts to ranching operations from a variety of predators, including gray wolves.
- We've developed research-based information regarding the effectiveness of a variety of livestock protection tools.
- We're continuing to offer a variety of farm and ranch business planning workshops and short courses designed to help beginning and established producers improve economic viability.
- We're conducting a cross-sectional survey of irrigated pasture management systems throughout northern California, including on five sites in Placer and Nevada Counties.
- I'm starting a research project evaluating livestock guardian dog behavior and wildlife interactions that may ultimately include ranch partners and researchers in other Western states.
Coming into this position from a production background, I've realized that there are more needs than any one person can possibly address. My needs assessment has helped me identify what I feel are the key priorities currently. Obviously, these needs will evolve as economic, environmental, and climatic conditions change. What an exciting prospect!
I'd still like to hear from and talk with more producers! Contact me at dmacon@ucanr.edu or (530) 889-7385 if you have questions, comments, or would like to schedule a ranch call!
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