Will Sawyer says Walmart’s New Beef Plant is More Sizzle than Steak, For NowWed, 05 Feb 2020 13:23:49 CST
Walmart, the largest food retailer in the U.S., officially entered the beef business in January when it opened a case-ready beef plant in Georgia after establishing its own Angus supply chain. Creating an end-to-end beef supply chain is the latest step Walmart has taken in its vertical integration strategy for food and toward its stated goal of improving the quality of its food offering, according to a new report from CoBank’s Knowledge Exchange division.
If Walmart’s new beef plant and Angus supply chain succeed, it could lead the retail giant to take another step up the supply chain towards the producer. That could be in the form of harvesting fed cattle or through a joint venture with a current packer.
“Walmart sees opportunity and is moving up the supply chain at a time of historically high margins for beef processors,” said Will Sawyer, animal protein economist with CoBank. “We believe their current beef strategy is something of a test, not only for Walmart and its suppliers, but also its customers.”
The new plant will cut and prepare steaks and roasts produced by Walmart’s Angus beef supply chain for 500 stores in Florida, Georgia, and Alabama. Walmart will need to convince customers that the attributes of its beef, which is hormone-free, traceable, and potentially of higher grade, make it worth buying at a premium price.
Radio Oklahoma At Network Farm Director Ron Hays talked with Will Sawyer at the Cattle Convention in San Antonio about the CoBank study. You can click on the listen bar below to hear the complete interview.
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