Farmer Driven Company Evolves
By Kathleen Harris
The Northeast Livestock Processing Service (NELPSC) is a company that was started by 5 farmers with a notion to help their fellow farmers with livestock processing problems. Now in business for 6 years, NELPSC has evolved from a totally grant supported notion to a self supporting viable LLC owned by those same farmers who became partners. Starting with an untested business model, it now boasts 123 farmer members and working agreements with 11 processing plants. While it continues to assist small and large farmers alike with livestock processing, NELPSC also expanded their mission to assist farmers with their marketing. But how did it all get started? Where is it now? And where is it headed?
About 10 years ago, Seymour Vander Veen, a dairy farmer from Schenectady County was the sitting president of the Hudson Mohawk RC&D (Resource, Conservation and Development) Council, the organization that led the charge in gathering livestock farmers and processors together in order to solve a looming problem—insufficient and unreliable USDA livestock processing. Vander Veen was known to illustrate the severity of the problem by telling of his own experience in attempting to schedule slaughter of a veal calf. When his processor scheduled him 6 months out, his response was, “are you kidding, man–by then it won’t even be veal anymore!” With new found determination, VanderVeen and 2 other RC&D Council members, Ed Armstrong and John Walston joined with 2 other prominent livestock farmers, Jim Hayes and Jim Sullivan to steer the project. Walston secured the initial funding from the David Rockefeller Foundation and that was matched by New York State Ag & Markets to do the feasibility study and business plan. Upon completion of the feasibility study, these 5 farmers formed the Northeast Livestock Processing Service Company, LLC (NELPSC) and became incorporated on June 1, 2005.
Soon after incorporation, they hired a Processing Coordinator, Kathleen Harris, a USDA trained livestock grader and long time meat marketer. She was charged by the Board of Directors to take the recommendations of the feasibility study and develop a livestock processing Service Company that would help farmers navigate the nuances of the USDA custom processing business. Initially selling the concept of the untested business model to farmers wasn’t easy. Most had a “wait and see” attitude. However, by April of 2006 the first NELPSC farmer member was signed on and (8) USDA and New York State Custom processors had working agreements with NELPSC to provide processing for their members. NELPSC then positioned themselves between the farmers and processors to ease the development of the farmer/processor relationship and mitigate any problems that might occur there. This service is called Processing Facilitation and is performed on a fee-for-service basis.
Processing Facilitation includes 4 basic services: farmer/processor matching, scheduling, taking and conveying cutting instructions and in-plant oversight. First the NELPSC Processing Coordinator works one-on-one with the farmer member to determine a best-fit processor for them. This is determined by matching the farmer’s location, service needs and price point with the closest, most affordable processor that has the capabilities to match. For instance, not all processors make beef patties. Some don’t put weights on the packages. And those that slaughter hogs may not be able to scald them, leaving the skin on (a preference for many restaurants.)
After matching the farmer with a processor, NELPSC also will schedule for the farmers and assist with cutting instructions. Kathleen Harris, the Processing Coordinator says, “Most farmers new to direct marketing lack knowledge about the cuts of meat and are unfamiliar with the language of the processor. When I work with farmers to fill out a cut sheet I send them a copy of it for their records, in addition to sending it to the processor. After one or two times, and having the cut sheet as a reference, the farmers quickly learn how to take their own cutting instructions. Most farmers take over their scheduling and cutting instructions after the first couple of times. Our goal is for our farmer members to achieve processing independence. We are here for as much or as little as they need us” NELPSC can also provide in-plant oversight on a half day or full day basis to further allay a farmers trepidation about dealing with a new plant.
Debbie and Lee Millington from Indian Ladder farm in Little Falls joined NELPSC in 2008 and had this to say about the processing facilitation services: “We were just getting started in the beef trade and to say we needed some direction would be an understatement. We had the basic concept—get the beef sold locally…but when it came to pricing and helping customers with cutting choices, we were groping in the dark. Your advice, information and help were well worth the money. Thanks for your patience in answering our many questions during our frequent phone calls and for calming our fears about the processor-your presence on processing day was invaluable…It certainly moved our marketing to a professional level.”
After a year of offering processing assistance, it became apparent that many farmers also needed help with marketing. Although some NELPSC farmers were savvy marketers and able to retail their products through farmers markets, restaurants and farm stands, there still were those farmers who lacked the time, skill or desire to market face-to-face. The NELPSC Board of Directors recognized this and moved to assist those farmers by purchasing their grassfed and natural grainfed meats at a price that compensated them for their efforts to produce a sustainable product. Michael Brunn from Schoharie County said, “I’ve been a farmer for 36 years and for the first time I feel like I am finally getting an honest price for my product.”
But before NELPSC could start buying the livestock, they had to develop the outlets for such products. Because NELPSC has a core value not to compete with their farmers in the same markets, they developed an outlet for those products by becoming an approved vendor with a major food service company that supplies colleges and institutions. The market entry requirements were onerous and expensive and more than any one farmer could do for themselves. And because the entire industry was geared to purchasing inexpensive boxed meats from the large packing plants of the midwest, it took 2 years to overcome the barriers before finally becoming an approved vendor.
Now as the orders come in, the livestock are sourced from NELPSC farmers. Kathleen Harris travels to the farms to select the livestock and gather the farmer affidavits. She then coordinates slaughter and processing with the USDA and 3rd party audited plants, performs in-plant oversight when necessary and arranges delivery with the NELPSC refrigerated truck and the receiving personnel. NELPSC meats are not branded. Instead the farm name and location is tracked with each order so that the purchasing institution knows exactly where their meat came from and where it was processed. NELPSC is presently preparing orders for 15 schools (k-12), colleges and universities amounting to 13,000 lbs of meat from 27 head of livestock from 10 different farmers. The NELPSC delivery truck signage captures it all…Local Foods from Local Farms.
The NELPSC mission and values are arguably altruistic for a for-profit company. Despite that, the company continues to grow steadily with increased farmer membership, increased processor agreements and increased sales each year. Grant support was integral to the development of NELPSC. The majority of those funds came from the New York Farm Viability Institute. They acknowledged that processing and marketing were problems for our livestock farmers and chose to invest in NELPSC and other projects that helped to alter the course of livestock processing events. That investment helped to bridge the gap for livestock farmers so they could get the processing they needed to keep their businesses sustained while the processing industry was gearing up to take on the local food movement.
Now, there are more USDA plants, at least in this eastern region of New York, and the future looks very bright for our livestock farmers. Over the years, support for NELPSC was also received from USDA Natural Resources Conservation Service, Rensselaer County Economic Development Office, the Hudson Mohawk RC&D Council and the New York State Senate Majority Leader’s Office. The last grant funding was received in May of 2010. Since then the company has been self supporting.
To learn more about NELPSC visit www.nelpsc.com or contact Kathleen Harris at (518) 258-4823.
Kathleen Harris is the Processing and Marketing Coordinator for the Northeast Livestock Processing Service Company and can be reached at (518) 258-4823