Cornell Cooperative Extension Releases Livestock Meat Price Calculator
by Kina Viola
New York livestock farmers, whether experienced or just getting started, will benefit from the release of a new pricing tool from Cornell Cooperative Extension. The “Livestock Price & Yield Calculator” exists as part of MeatSuite.com, an online directory of over 160 New York State farms selling meat in bulk. The calculator has been designed to allow farms to enter their own data and profit goals, then price their meat with the assurance of meeting those goals. These features make the calculator a vital tool for farmers to create pricing for each marketing channel they utilize, whether selling whole carcasses or meat by-the-cut. For success, users need to prepare in advance by gathering their current meat prices, invoice from their processor, and the weights of cuts from one average animal in their herd. With this information on hand, the calculator takes about ten minutes to use.
Marketing labor, processing and travel costs, and the difficulty of meat-cut inventory management may leave farmers wondering if local food channels, such as farmers’ markets or restaurant sales, can yield profits. The calculator can be used to develop the pricing needed for a farm to realize a profit in each channel. In some cases, the prices calculated won’t work for the customers in that channel; this is an indicator that the channel is not viable. In contrast, where price adjustments are tolerated, the farm can proceed with sales in that channel, confident that they are receiving a profit with each sale. In this way, the calculator tool is not only for figuring out pricing, but also a means to “test” the viability of marketing channels.
The calculator addresses several barriers in meat direct marketing, most notably that farmers utilizing value-added channels typically underestimate the value of their invested time. To solve this, the calculator includes features that empower the producer to create a desired level of profit—either as a percentage mark-up or as a flat dollar-per-head value—and set pricing of cuts or whole animals to reach the goal in each channel. Farmers who drive longer distances to truck their animals to processing are compensated for time and gas, for example. Additionally, the price calculator combats the confusion many producers may have about managing inventory, and how inventory can be managed by prices. The “magic” of the site lies in the farmer’s ability to manipulate the prices of individual cuts based on their proportion on a carcass and the degree of consumer demand in the farm’s channels, all while maintaining the desired level of profit per head.
The calculator is an exciting tool for building up farm viability. But its benefits don’t end with the producer—it can also facilitate a productive exchange with buyers. Wholesale buyers wishing to buy meat by the whole and half animal can use the calculator to understand how to price different cuts, whether for a plate cost or for the retail case. Additionally, farmers can use the calculator with potential wholesale buyers in order to teach them what goes into the farm’s prices. Using the site, buyers are able to see costs like transportation and processing fees to better understand the value of the products. Farmers and buyers will be encouraged to collaborate and develop a price that works for both parties.
For farmers to survive over time, the ability to set fair prices for their labor becomes key. With each use of the calculator, producers will take steps to ensure for themselves a more reliable income and feel confident that their hard work is paying off.
NYS farmers are invited to use the Livestock Price & Yield Calculator located at calculator.meatsuite.com. MeatSuite.com, which houses the Calculator, is an online directory any farm selling meat in bulk can join. Farms may contact Matt LeRoux, firstname.lastname@example.org, for help or with questions.
Kina Viola is a Project Coordinator for the Finger Lakes Meat Project, a project of Cornell Cooperative Extension of Tompkins County aimed at increasing the freezer trade regionally. She also manages the MeatSuite.com online directory, and the Ithaca Meat Locker, a community storage space for bulk meat.