“High Quality Beef Systems Demand High Quality Health”
Creating Something Better Texas’ Friona Industries is a facilitator of innovation and excellence
in the beef industry’s branded product environment.
As the facilitative link between the cow-calf sector and the eventual end-user, the consumer, Friona Industries, L.P., headquartered in Amarillo, Tex., strives to create a better beef product. Friona is the No. 4 feeder in the country, with four commercial state-ofthe- art cattle feeding facilities in the Texas
Panhandle.
For nearly five years, Friona has engaged in a commercial alignment with Cargill Meat Solutions Corp., a leading processor of fresh beef, based in Wichita, Kan., feeding cattle for a series of its brands. Three of Friona’s four yards form the base for this vertically aligned production system.
Friona’s president and chief executive officer James Herring explains, “We are in a predictable production mechanism that throws off predictable results into a branded template. That’s the future in the beef industry.”
Herring has captained Friona since 1989. He’s spent his whole life in the beef cattle business, coupling work experience with a finance degree from the University of Texas and an MBA from the Harvard
Business School.
He notes that the branded platform includes five brands: Prime, Certified Angus Beef®, Cargill Meat Solution’s Sterling Silver®, AngusPride®, and Rancher’s Registry. Tenderness – the beef attribute U.S.
consumers value most – is the hallmark for all brands. Friona shoots for a tender low-Choice, high-Select beef product, which are the specifications for Rancher’s Registry.
Herring explains that when they raise cattle for that particular brand, the genetics and the kind of cattle they select will also throw off premium brands. Some 15 to 20 percent of the cattle fall into premium
branded categories.
“So, we’re not producing for a single branded program. We’re producing a series of cattle for a branded template, which encompasses five brands,” Herring says. “It’s a vertically aligned production system
based on tenderness. What comes out of that goes into five slots depending on the conventional grading system.”
Last year, 71 percent of Friona-fed livestock went into one of the five brands. Herring says this type of alignment has been extremely successful for Cargill Meat Solutions because it gives the company a
dedicated supplier.
“The supply is coming every single day in predictable quantities and predictable quality. It’s one of very few vertically aligned systems with tenderness as the objective that has critical mass,” he says.
All brands go both into food service and retail market sectors. A major customer for the Rancher’s Registry brand is Safeway, Inc., one of North America’s largest food retailers based on sales. Meat cases in Safeway stores are stocked with beef this retailer labels as Rancher’s Reserve (see photo above).
Herring fully stands behind the Rancher’s Registry product Friona turns out, especially its consistency and tenderness. “Rancher’s Registry is high-Select and low-Choice, but guaranteed tender. It’s the
best product in the U. S. period.”
Uncovering Predictability
Friona has experimented with a vertically aligned production system for around 10 years. “We know a lot about what cattle do and what you can count on,” Herring says. He explains the procurement, production, and harvest aspects are all wrapped around the concept of tenderness.
“All of those methodologies and details within those three segments are all dedicated to creating a consistently tender product. And that’s shown terrific results.” Friona is responsible for procuring the
raw calves and feeder cattle used in this program — and they are specialists at it. Herring says their systems tell them not only what cattle to buy, but also show how predictable the cattle will be as to
their end product.
With proprietary technology, Friona’s developed what it calls its arbitrage database from which it constantly evaluates cattle from seven key U.S. areas for price, quality, and consistency. This database contains about one million cattle, Herring says, but its development is ongoing.
Designed for Friona The information that Friona collects supplies this feeder with a complete history on cattle, including animal health. They know which health products work, and the health protocols on animals from different parts of the country. They use information like this to help standardize all phases of their vertically aligned production system.
Friona doesn’t take any sale barn calves or high-risk cattle into its feeding operations. “We try to get all of that taken care of before,” Herring says. This feedyard’s chain of preferred suppliers and backgrounders are all involved in the process of keeping cattle healthy.
“They know exactly what we want, and they know how we want it prepared, so the livestock coming in is designed specifically for us.”
Herring explains their preferred suppliers have set protocols on how they prepare cattle for Friona, and that “Titanium would certainly be one of the products approved for use.” Suppliers follow a shot location regimen and all injections are given subcutaneously, for which Titanium is approved.
Cattle are initially vaccinated at Friona but aren’t revaccinated because of the way they’ve been handled prior to the feeding phase. Health protocols are forced downstream because, when it comes to
cattle health, nothing is taken for granted. “It’s absolutely critical that the animal health side be an important piece of this puzzle.”
Herring stresses the “absolutely” three times, all underlined. Friona focuses on cattle that are
predominantly English-based. Herring says, “We don’t necessarily require health information on cattle, but we’re very concerned about how they are handled, where they’ve been, and what’s been used on them. We’ll go to great lengths to find that out. The more information, the better.
“There is enormous value for cattle that do not get sick, enormous value to the carcass for cattle that don’t get sick, and there’s a huge difference in genetic quality one animal to the next. We’re trying to define and separate that.”
Communicating Back
Friona willingly shares information with its cow-calf suppliers, too. “An active communication back to cowcalf producers is what we’re all about,” Herring says, adding, “If they can wean and precondition on the ranch, that’s a whole lot better.”
He relays that Friona makes a good partner for the cow-calf segment, as well as others. “Producing in a branded environment has made us a better, more consistent cattle feeder, and a much better partner for suppliers to us – cow-calf and stocker operators.”
Herring points out that Friona is in the market 24/7. “In fact, we’ve bought cattle that weren’t even born yet. So, we know a lot about individual operations, where the individual genetics are, and those producers who are trying to create something better.” He says Friona tries to stimulate and invigorate those types of producers.
Success in a Branded Environment
Herring foresees Friona as a branded producer for a long time. “With the success that we’ve had at the retail level, I don’t think we will ever backtrack, unless forced to. “This is our business system that we have developed over time. Before that, we were just like any other commodity cattle feeder. We have found a workable system where the packer enjoys the regularity and consistency of a branded product; we enjoy the regularity and consistency of having our feedlots completely full with a regular product. It has benefits for everybody.”
Employees, too, are motivated by this vertically integrated system. “When they know what the target is and all the resources we have, both physical and mental, are applied to the brand, they have a very rideful sense of accomplishment,” Herring says.
“This is consistent, high occupancy, high utilization of assets to a very specific target and they’re very prideful of hitting the target.
“We spend all of our waking hours either creating a better raw material to go through the system or creating a better product for the end-user. We have the best, most consistent, most tender product in the
world today. I’m very proud of that and I think it’s what will change the industry.”
For more information on being a high-quality supplier for Friona Industries L.P., contact Brad Stout, Friona’s cattle procurement manager, at (800) 658-6014.