Meat sales brisk, producers scrambling due to COVID-fueled meatpacking disruptions
WEST FARGO — Area grocery stores and meat markets are still meeting demand for beef, pork and chicken despite stock-up purchases that are starting to rival that of toilet paper at some stores.
At Costco, the hamburger part of the meat case was emptied by noon on Wednesday, April 29, and packages of steaks, roasts and chicken were being grabbed by shoppers.
“Sales have been brisk. We have a limit on the meat,” said a manager, Tom Haas. “We’re having a tough time keeping the stock replenished.”
The driving force is another worry generated by the COVID-19 pandemic.
This time, it’s closures of meatpacking plants as the virus infects or sickens employees working in tight quarters.
Outbreaks in recent weeks at regional pork plants, Smithfield Foods in Sioux Falls, S.D., and JBS in Worthington, Minn. , have led to closures. Those meatpackers were recently declared critical infrastructure by President Trump so they can operate through the pandemic.
Still, that’s forced producers to scramble for other processors, sell at a loss, or euthanize animals.
Working the phone lines
Dave Roesch grew up on a farm near Ada, Minn., and has been raising pigs for 40 years, starting with a pig he raised as a 4H project.
Like clockwork, every two weeks he’s taken 180 hogs to the Smithfield pork plant in Sioux Falls.
“We get paid the next day for the last 20 years,” he said Thursday, April 30
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Roesch aims to sell the hogs at 275 to 280 pounds. If they get too heavy, the plant has difficulty processing them and he faces huge discounts.
When Smithfield shut down due to a coronavirus outbreak in mid-April, Roesch started selling hogs to individuals and area locker plants.
One day, he was on the phone for 11 hours taking names and numbers and making arrangements with locker plants to process for “people that are concerned that the stores are going to run out and they want to fill the freezer up.”
He has sold or booked nearly 400 hogs direct to customers and another 180 to locker plants to be processed for their customers.
The first of those hogs Roesch sold for less than his input costs. He’s since raised his price to cover those costs. He now has buyers for his output through mid-June.
His approach works because he produces 3,500 to 4,000 hogs a year. But large hog operations, which contract their output, can’t do that.
That’s already led to thousands of healthy hogs being euthanized in Minnesota, and could lead to many thousands more, depending on how quickly packing plants can get back up to speed.
Roesch said that is not an option for him.
“We’re raising them for people to eat,” Roesch said. “The last thing you want to do is let them go to waste.”
Faith and hope
In Napoleon, N.D., Paul Bitz and his brother, Jim, run the J&P Livestock cattle feed yard to finish cattle, and the Napoleon Livestock auction company.
“It’s never impossible to adjust,” Paul Bitz said. “You go from hoping to make money to surviving and adapting. (But) The bigger you are, the harder it is to become flexible enough to adapt.”
Five weeks ago, there were 680,000 cattle sent to slaughter. This week, Paul expects it could drop to 450,000. That has meant cattle are backing up.
Most deals are done with packers, who won’t buy if they can’t process them.
“This is the 26th year I’ve owned a sale barn. We’ve fed cattle since 1997. This is the first stretch in my life where I could not get a bid for my product,” Paul Bitz said.
At one point, they were losing $375 a head even when they could find a buyer, he said..
Jim Bitz said that because of the drop in cattle prices, people have held off on selling calves. He says many will be put out on grass to slow their growth.
The cattle are an investment that have to be taken care of, Jim Bitz said.
But with business down for both the feed yard and auction company, “We’re sinking with two holes in the ship,” Jim Bitz joked.
Paul Bitz said that the situation is frustrating, and it comes down to faith and hope.
“To be in agriculture, you’ve got to have faith that it’s going to get better, and hope that it’s going to get better,” Paul Bitz said.
‘Busier than busy’
At Prime Cut Meats on Fargo’s South University Drive, owner Kevin Jenkins said Wednesday that his business has been unaffected by meatpacking plant closures in the region.
“I got eight wholesalers I can deal with," Jenkins said.
People don’t need to panic buy meat, though he warned there might be some spot shortages in the next few weeks because so many states are lifting stay-at-home recommendations.
“Every restaurant in the nation is going to be opening at the same time,” Jenkens said.
He’s also has noticed that customers are buying more meat.
“We’ve been busier than busy” the last few months, he said. So much so that he hasn’t been able to do any custom meat processing orders.
Jenkins is waiting for summer to see how things play out with the progression of the virus.
“That’s all we can do,” he said.
‘Coming in like crazy’
A couple miles to the west, Jason Aamodt, co-owner of Meats by John & Wayne on Fargo’s 45th Street South, also has plenty of supply.
But like Jenkins, he expects meat market and grocery store shelves to have some empty spots in the next two to three weeks, thanks to restaurants restocking and reopening dining rooms.
People have been stocking up for awhile, he said.
“They’re coming in like crazy,” Aamodt said.
In January, a typical day would see 130 customers come in with each buying $30 of meat. “Now, you have 130 customers buying $300” worth of meat,” Aamodt said. “It’s hard to keep up with that. … You come in four hours early and you leave three hours later,” Aamodt said.
The shop doesn’t do any meat cutting on livestock, and wild game processing isn’t possible right now. But people have been buying animals that couldn’t be taken to slaughter, hoping to fill their freezers at a bargain price, Aamodt said.
“You wouldn’t believe in the last three days how many people have wanted to process 300-pound hogs that they bought for $50,” he said.
Letting others get a shot
A few quick stops in grocery stores in the Fargo-Moorhead area found a good variety of meats in coolers at mid-week.
Outside the Moorhead Hornbacher’s, Sue Hogsett of Dilworth was loading up her vehicle Thursday.
Hogsett said she’s been sticking with her strategy of watching for sales and stocking up then. But she noted that there were limits on some kinds of meats.
“Today the hamburger is limited, but that’s OK, and it allows more people to get it,” she said.
Bailey Haugen of Moorhead was at the ALDI store in Dilworth on Thursday, though she works for another grocery chain.
“For meat, I’m definitely seeing a lot of shortages,” Haugen said. And she said some people may be hoarding.
She owns a freezer, but she won’t clear out a cooler when she stocks up.
“Other people probably want it more than I do,” Haugen said.
Balance will be found
Hornbacher’s Foods President Matt Leiseth said the store is doing fine in terms of stock, despite the fluid situation around the closing and reopening of meat plants.
While inconvenient, Hornbacher’s can still get product by purchasing from other slaughterhouses, he said.
The uncertainty of supply means it’s less likely that the local grocery chain will have as many meat specials. There may also be limits on the amount a customer can buy in any single trip.
“We always say we reserve the right to limit quantities. You want to make sure you’re serving everybody.” Leiseth said.
“Buy what you need and save some for the rest,” Leiseth said. “There’s plenty to go around.”
Leiseth expects if there are problems in meatpacking, it would show up as fewer cuts of meat being offered. Rather than 22 cuts of chicken or other meats, a store might have five easy-to-produce cuts.
He said the market will balance itself out.
“When (the price of) beef gets high (in summer), then people buy pork and chicken. By the Fourth of July, everyone’s eating beef again,” Leiseth said.