A North Dakota-based cattle co-operative is forging ahead with plans to put together a producer-owned beef processing and marketing company in spite of a winter
equity drive that fell far short of expectations.
Northern Plains Premium Beef, with producer/members in the northern U.S. and the Canadian prairie provinces, needs 250,000 shares to meet the terms of the security offering. The drive held this winter secured 113,000 equity shares with 1,055 paid members, said spokesperson Ryan Taylor.
The shortfall was discouraging, but Taylor said it wasn’t the best time to raise money.
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“An extremely brutal winter put a great amount of stress on ranchers and farmers who simply tried to keep their herds alive,” Taylor said.
When the board of Northern Plains holds its annual meeting in June members must decide what direction the co-operative will take.
The deadline for cattle producers to buy memberships and equity stocks in the co-operative has been extended to June.
Choosing locations for the co-operative’s two beef processing plants won’t take place until the required 250,000 shares are raised.
Nearly 3,000 farmers contributed seed money to get the project running. The co-operative will target those producers to become full members of the venture, Taylor said.
Memberships cost $200 each. Producers then pay $100 per head for animals they want to market through the co-operative.
If the required $25 million is not raised by June, the group will return money to farmers and come up with a smaller-scale plan, Taylor said.
“I’d rather be in control of my future and adding value to this product to recapture market share and put money in the hands of producers.”
The co-operative could look at options such as entering into a joint venture with an established processing company, merging with other producer groups with similar goals or funding another equity drive, Taylor said.
