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How to increase your profits with value-added programs

AgriWebb - Value-Added Programs

Our recent webinar covering certifications and value-added programs attracted interest from ranchers across the US. Below are some of the insights our panelists shared.

The importance of process verified and value-added programs

Value-added programs bolster claims about the background of livestock and the conditions in which they have been raised. Of increasing interest to consumers, they also give ranchers the opportunity to be better rewarded for their ranch management practices.

Process Verified Programs, or PVPs, operate under the oversight of the USDA ​​Agricultural Marketing Service. “When the PVPs started, they mostly had to do with export verification services, and that’s still very common today,” RaeMarie Knowles, President and Managing Partner of Legacy Verified, explains.

In the wake of the mad cow outbreak, PVPs were paramount. “We were not able to export any beef out of the US,” RaeMarie says. “One of the ways we were able to open those markets back up was with Japan, with the Source and Age Verified program.”

“The NHTC program, for non-hormone treated cattle, was invaluable for export to Europe,” RaeMarie says. “We tried to tell them, ‘We’re going to send you conventional beef. It’ll be fine.’ And when we did that, it literally rotted on the shelves. Those consumers are very aware of the products they want, and hormone-free beef is top of their list.”

While PVPs proved vital for exports, they have become increasingly important in the domestic market, and producers can have programs designed especially for the claims they want to make for their cattle.

There is also a wide range of value-added programs beyond PVPs, that verify how cattle are raised. Among these are animal welfare programs such as Global Animal Partnership and Certified Humane, grassfed programs like American Grassfed Association certified and Certified Grassfed by AGW, and environmental programs, including Certified Organic through the USDA’s National Organic Program.

“It all boils down to one idea, which is consumers wanting to know more about their food products,” says RaeMarie.

What’s in it for the rancher?

For Lori Conrow, Director of Ranching Operations at SunFed Ranch in California, these programs play an essential role in showing a sometimes skeptical public the great work that ranchers are doing. “As ranchers and as farmers, we’re not necessarily good at selling our story. These third party-verifications give consumers the assurances they are looking for,” she says.

People want a product they can feel comfortable with, knowing claims made for that animal have been verified. And gosh dang, I’ll promise you, there’s money behind that because there’s a lot of demand for beef with no hormones and traceability back to the ranch.

Lori Conrow Director of Ranching Operations, SunFed Ranch

Like Lori, Moritz Espy, the Ranch Manager for 777 Bison Ranch in South Dakota, wants people to trust the story of his livestock. “Bison have this halo with the consumer, and everybody assumes that they’re grass fed, but we looked to third-party verification to say, ‘It’s not just Moritz standing next to a table at a farmer’s market saying this – it’s the AGA, it’s GAP4, it’s the Audubon Society, it’s Savory.’ It throws a little more weight behind it and sets us apart.”

That difference has landed 777 Bison Ranch a broader customer base. “Once you’re certified, the certifier has your name on a list, and people looking for a specific product have reached out to us through that. Plus, once you get certified, you can go, tout it, and pick up a few more customers along the way.”

And it doesn’t take marketing savvy to reap benefits from certifications. RaeMarie advises that national video sales are a way to receive top dollar for your PVP cattle. “The buyers that need the cattle are all in one room at one time,” she says. “You have buyers for feed yards that supply to Tyson that want the natural and the NHTC. You have buyers for 44 Farms trying to fill feed yards with NHTC beef for Walmart. You get all these people in one room bidding against each other, and that’s how you get the $6 and $16 per hundredweight premiums.”

Finding the programs that fit you

The value-added programs you consider should sit well both with your operations and the market you are selling into. Based in California and selling to a forward-thinking market that is further removed from the ranching industry, SunFed has found having a wide range of verification programs worthwhile.

“They appreciate the traceability and the third-party verification. They like to know the product they’re getting is truly coming from a ranch where animals are raised on grass, they’re non-GMO, and they’re not getting hormones,” Lori says. In all, SunFed Ranch has eight verifications, including Certified Humane and GAP4, Verified Natural, and Savory’s Ecological Outcome Verification.

The variety of verification programs may sound overwhelming, but it offers ranchers many opportunities.

You don’t change yourself to fit the box because there’s a box that will fit you already, no matter what you’re doing.

Moritz Espy Ranch Manager, 777 Bison Ranch

Working to help ranchers with the verification process, RaeMarie says, “On our end, it’s simple: we start with a conversation, because we want to know about the ranch. We want to know what programs give you premium earning potential – we’re very cognizant of putting you in programs that will work well for you.”

How to make audits easy

Naturally, the audit process will vary depending on the program you have signed up for. Still, one thing is central: the need for reliable records.

“For ranchers nervous about audits, I know it’s scary. And the record-keeping can seem cumbersome, but it’s what you’re used to doing anyway. You just have to let somebody come in on the ranch and take a look around,” says Moritz.

“Our last audit was in person; we fired up the computer, logged onto AgriWebb, and showed him everything – the grazing and pasture records. He pulled up a couple random animals to see what their history was. Something I showed him that I thought was interesting is the master record of all the inputs – it lists all the entries as they’re entered, and it’s very transparent.”

The convenience of having records stored in the cloud, and accessible online, has taken the stress out of audits for Lori, too. “The paperwork’s right there; you don’t have to hunt for it. You don’t have to go look in the office. With AgriWebb, I can literally stand out in the field and pick out an animal (see the video below). I can pull up its tag and tell you where I bought it, what I paid for it, what certifications he came with, and what vaccinations he’s had,” she says.

“I’ve had eight audits within the last two months because it happens to be our season, and we are a hundred percent successful, and AgriWebb has made it easy.”

If you’d like to take advantage of your profit potential with the help of time-saving technology that can help make your PVP and certification audits a breeze, get in touch with an AgriWebb expert. Looking for a PVP auditor? Legacy Verified is helping ranchers increase the value of their livestock. Click here to engage a member of their team. 

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