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‘Herd share’ guide helps farmers, consumers

Scott Olson /Getty Images New York strip steaks
BEST CUTS: A new six-page guide published by the Center for Rural Affairs guides farmers and consumers through the process of establishing a herd share agreement, allowing farmers to market small packages of meat processed at a custom-exempt processor directly to consumers.
The guide from the Center for Rural Affairs walks farmers and consumers through the ins and outs of a herd share program.

If you are a farmer who direct-markets home-raised meat from your operation to local consumers, COVID-19 and its effect on the food supply chain in the first half of 2020, in particular, changed your enterprise forever.

Supply chain issues because of COVID and other causes have allowed consumers to look more directly to farmers and ranchers to fill their freezers — and have offered opportunities and challenges for producers who are trying to feed the new demand.

Scheduling livestock processing with local lockers is an arduous process to say the least, with waiting times for slotting up to a year in advance — especially at USDA-inspected facilities.

Both consumers and direct-market farmers in Nebraska gained a little steam with the unanimous passage of LB 324 during the 2021 Nebraska legislative session, making it easier for consumers to purchase individual packages of meat directly from producers or processors and raising the profile for a marketing framework known as a “herd share program.”

“A herd share agreement provides an alternative where multiple individuals can establish an ownership interest in the same animal, which entitles the consumer to meat processed in one of the numerous custom-exempt locker plants across the state,” says Johnathan Hladik, Center for Rural Affairs policy director.

Farmers who wish to take advantage of this type of program and want to educate local customers about how it works can use a new guide produced by CFRA that offer the details and examples of how herd share can work.

According to the CFRA guide, a herd share program enables multiple individuals to establish ownership interest in the same animal. If one share equals 1 pound of meat, the customer-owner can purchase as many shares as they need, from one share or 1 pound, to 1,000 shares or 1,000 pounds.

The six-page guide includes step-by-step instructions for the program, specific guidelines for each herd share agreement, and even sample shareholder and animal share agreements.

“This guide gives producers the information and resources they need to establish agreements with customers,” Hladik says.

While the guide may be most useful to potential customers, farmers may wish to point new customers to this guide to learn more about how such agreements work.

“I really think this might be just as useful to the farmer, if not more,” Hladik says. “This lets the farmer know what steps they will need to follow in order to comply with state and federal regulations.”

He says that he wanted to make the guide accessible and easy to use, so farmers can gain more certainty while using this strategy to sell meat.

“In Nebraska, it is much easier to find a custom-exempt processor than a USDA-inspected processor,” Hladik explains. “There are many more custom-exempt shops, and they are spread across the state. This works well for the farmers who sell a side of beef or half a hog. But it doesn’t work well for the farmer who sells pounds of bacon or bundles of ground beef. It also doesn’t help the consumer that might not have the freezer space for 200 pounds or more of meat.”

To sell individual packages of meat, farmers need access to a USDA-inspected facility. The few that are out there are booked far in advance. “The herd share program is designed for those farmers who want to expand their business and the consumers new to buying meat outside the grocery store,” Hladik says.

The Nebraska law passed last legislative session creates a framework that ensures compliance with current Food Safety and Inspection Service regulations and guarantees acceptance under the law.

Hladik says that prospects are good that the Nebraska Legislature this session will build on the framework established by LB 324 last year, creating the Independent Processor Assistance Program.

“If funded, LB 755 would be a state-based grant program designed to expand the capacity of local independent meat lockers,” he says. “Costs eligible for funding under this program include building construction, freezer expansion and workforce training to make sure we have enough skilled workers to get the job done.”

Learn more about the new CFRA guide on the herd share program at cfra.org, or follow processor legislation in Nebraska’s Unicameral this session at nebraskalegislature.gov.

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