A PRELIMINARY FEASIBILITY FOR ESTABLISHING A MULTI-SPECIES MEAT PROCESSING PLANT IN SOUTHWESTERN NORTH DAKOTA

The number of small commodity livestock slaughter plants in the Upper Northern Plains region continues to decline. Significant factors contributing to this decline include: 1) pressure to consolidate, thereby capturing economies of scale; 2) relatively stringent federal inspection specifications, along with; 3) HACCP (Hazardous Analysis Critical Control Points) requirements. At the same time, consumer demand (markets) for specialty, selected, and exotic meats appears to be growing. For example, the recent market successes in Europe evidenced by the North American Bison Cooperative based in New Rockford, North Dakota. Several alternative livestock producer groups have emerged which include lamb, ratite, elk, deer, goat, poultry, rabbit, specialty beef, and organic livestock. These groups have expressed a need for slaughter and processing facilities to meet market demand. The economic question which then becomes foremost to developing a viable business enterprise is: "What is the critical threshold volume (CTV) of product required to succeed in terms of economic profit?" Specialty livestock is relatively new and production volume small in comparison to established commodity livestock such as cattle or hogs. This fact led researchers to consider the preliminary feasibility of a multi-species processing facility as a means of addressing the expressed need.multi-species, specialty meats, specialty livestock, alternative livestock, economies of scale, HACCP (Hazardous Analysis Critical Control Points), slaughter plants, processing plants, Community/Rural/Urban Development, Agribusiness,

International Update, March/April 2010

International Business news from the Iowa International Office

VERTICAL INTEGRATION IN AGRICULTURE AND CONTRACT FARMING

It has been widely argued recently that agriculture is undergoing a process of vertical integration with allied industries. One of the worldwide ways of vertical integration in agriculture is contract farming. Contract farming is a continually evolving process. Worldwide applications of contract farming have shown that the terms of contracts are shaped by their own conditions and varied from product to product. Also, each country has its own experiences. Contract farming has many advantages for both producers/growers and integrators, besides some inherent disadvantages and failures regarding its implementation. Some measures, however, could be taken to outweigh these advantages for both sides. In this study, first of all, a brief history is presented along with an explanation of contract farming concepts. Secondly, the reasons behind contract farming are discussed. And, successes and failures of contract farming are analyzed based on several research works and articles. Finally a simplified model is presented for the success of private contractual arrangements in the light of evidence taken from the experiences on the world.Vertical integration, contract farming, out-grower schemes, Agribusiness,

Optimization Modeling of a Poultry Industry Supply Chain Network

Supply chain management is an asset to every industry globally due to its positive outcomes such as faster response time, reduction of unwanted inventory and lower sales costs with enhanced customer service. It is therefore important to focus on improving the supply chain network of any industry. The objective of this research study is to model a supply chain network for poultry Industry in Oman. The study analyzes the existing supply chain network within a poultry industry and recommended its improvement based on the identified factors while giving more emphasis on the routing and distribution network aspects of supply chain. The recommendation, in the form of optimization model, is verified and validated using Lingo optimization software. Also, heuristic method is proposed and tested to overcome the complexity of optimization model

American Native Beef Cooperative

The American Native Beef project involved a failed attempt to establish cow and bull slaughter operation in Southeast Oklahoma. The effort was initially organized as a new generation cooperative and raised over US$2.5M from area producers who retained their funds in escrow for over 5 years despite numerous opportunities to withdraw their investment. The business model was restructured several times to attract equity capital from outside investors. The case provides insights into the linkages between business strategy and business structure. It also raises the question as to whether the project could have been successful under the original business model.Agribusiness, Livestock Production/Industries,

Scheduling and Delivery Logistics of Bio-Perishable Goods: A Review Of Literature And Research Options

Logistics scheduling, specifically that of order and delivery schedules, is an essential part of a firm and the supply chain. The objective of this paper was to identify any gaps in academic and professional literature regarding the logistics scheduling of perishable biopharmaceuticals. A literature review of the logistics scheduling of general products, perishable medical supplies, and flu vaccines was conducted in order to verify any potential gaps in the literature. The approach used to study this issue was based on the grounded theory concept of qualitative research, and by then focusing on an extensive review of scheduling, ordering, and delivery in these industries. A gap in the literature was identified. The identification of this gap in academic and professional literature regarding logistics of perishable biopharmaceuticals provides a contribution to the body of knowledge. Suggested future research is identified. Finally, research propositions are included to begin to address the research gaps