Tuesday, May 2, 2017

Alaska Ag....The Protein Problem

Whether it's a smoked and slow cooked brisket in your backyard set up, veal piccatta, a rack of succulent lamb, a specialty cut from a charcuterie, burgers and brats on the barbeque, or a dinner plate T bone in the cast iron skillet at fish camp.....Alaskans do love their meats.  

Salmon, moose and caribou (and the occasional deer) aside, an enormous quantity of meats are shipped in to satisfy those Alaskan appetites. It's all well traveled from the PNW, and some items, from much further away, making for lengthy transits and adding a substantial cost to what you are putting on the table.  

Beef prices in particular, are so high that finally (cue the harps!) Alaskan beef is within pocket book reach of many shoppers. There's a large and growing push to eat local, to eat healthy, to support Alaskan farms and farmers. Check out the marketing of the "Alaska Grown" label in your local grocery store. Increasingly, you can also find Alaskan beef and pork on the shelf in the meat section. (And if the store you prefer to frequent, does not carry it-please ask!)

What makes this explosive growth opportunity so problematic is the complex set of challenging conditions the producers face.  

Affordable land to house livestock is unavailable. The State categorizes "farm land" as tillable (row crops, primarily) and new tracts are generally either inaccessible to market, or assessed and priced beyond a farmers' means. If they're lucky, they might find a lease, but most are unable to expand where they are located. Ironic, since the State has over a million acres at its disposal, and those parcels that do come up for auction, are high priced remote cabin lots, or developer parcels with price tags beyond what the BAC is willing to risk, even if they chose to lend on unimproved parcels.

Farm land and improvement taxes are expensive and complicated. Organized Boroughs have different methods to tax farm land, and most of those include a partial exemption on real property taxes on the acreage used-if enough income is generated. The houses, barns, shops? Full boat taxes in nearly every case. 

Available grain and forage.  Often overlooked by many, the amount of available hay and grain acreage is decreasing overall, while the numbers of livestock are growing.  Slowly, but poised to expand rapidly. As it is, there is not enough high quality roughage (hay) or barley and wheat grown, to satisfy the needs of livestock producers. Some grain and hay farmers are working to increase acreage, but with several 1000 acres taken out of production at Pt MacKenzie, there remains a very real risk of "not enough feed". This issue has not been addressed by the State in any substantive way, except to remove impediments on Canadian imported forages in times of crisis, as in previous years.

Marketing infrastructure is either non-existent, or patchwork. If you farm not too far from a large population center (such as Fairbanks or Anchorage) you are fortunate that getting your product to a market is relatively simple. Other areas of the state face serious challenges, whether it's a tenuous transportation system, lack of support from local government, no specialty transport available on a regular basis, or simply being too far off grid to reach any larger market.

Access to quality processing.  That little phrase sounds so innocuous, but means everything to the success or failure of a livestock producer.   A processor which is accurate, timely, and fair, is paramount to overall success. That has not always been the case with MMM&S. Indeed, they have recently increased their prices, and added new fees to their rate schedule. 

Again, there is a somewhat complicated set of rules and regs to follow. All meats packaged to be resold to consumers *must* carry a USDA stamp. That's a federal requirement, and it is provided at MMM&S (soon to be known by another name, no doubt) where the facility is inspected and approved for processing.  There is also what is termed a "custom exempt" plant, whereby the owner (livestock producer) sell direct to the public a live animal. It is then dispatched, and processed on site by the owner, pretty much.  

These and the other obstacles facing protein production in Alaska, continue to plaque the sector, with no relief in sight. There is some hope that the slaughter plant will flourish under new management when MMM&S finally changes hands-hopefully this month. But until that happens, and until it is known how the new owner will treat the competition, livestock producers are wary.  


Anonymous said...

What competition? The other two USDA inspected plants are several hours away! There is no competition here in South Center?

suvalley said...

Blog owner here-

If you had been following the blog, you would know:

MMM&S was recently sold into private hands.
That person is Greg G. of Mike's Quality Meats.
Greg G. and son also operate Rocket Ranch.
Rocket Ranch is on Lazy Mountain, and Mike's is in Eagle River.

You've seen the TV ads, perhaps?

So, a producer has purchased the slaughter plant.

(According to a recent BAC meeting, Director Keyes says the sale should close in perhaps two weeks)

Anonymous said...

The competition is the smaller farmers who have to pay to play. That is pay the big guy to play im his back yard. Director Keys was keen to sell the plant to save it. But it was sold at less then FMV and with no regard that it would put the new owner in control of anyone who needs its services. The new owner baught the most used cut and wrap facility for next to nothing. All those cut and wrap fees were going to keep the lights on for all of us to use. Now they will keep the lights on for those who pay to play. Hopefully the new owner will do right by the industry that needs MMMS so badly. If he doesn't you will see the death of small family meat production in the region.

Anonymous said...

I thought you were saying there were 2 processing plants in South Central by the competition comment as everyone knows there's only MMM&S/Gregs/Arthur Keys Plant.