Before the COVID-19 pandemic peaked in the United States, ranching, cattle producing and feeding, and processing company, Agri Beef Co., headquartered in Boise, Idaho, developed an idea to build a new, greenfield processing plant, True West Beef, in Jerome, Idaho. Agri Beef’s background in ranching and production gave it a solid understanding of cattle production, and in 2003, the company began processing with its Washington Beef plant in Toppenish, Wash. These experiences of both production and processing gave the company the idea to partner with its beef suppliers on the True West Beef processing plant.

“As we kind of grew past the ability to supply the demand of our brands, we had the idea to build another plant, but it was to do it differently and to use and work with our suppliers that have been in the market and working with us for 55 years,” said Jay Theiler, executive vice president of corporate affairs at Agri Beef.

Ready to roll

Fort Morgan, Colo.-based Schmeeckle Bros. Construction built the new 270,000-square-foot True West Beef plant. It plans to employ roughly 350 people for eight-hour shifts, five days a week, as well as the standard sanitation shift to ensure food safety standards are maintained. True West will ramp up to slaughtering 500 head per day through the first months of operation, which is expected to begin sometime in May. Theiler pointed out that production level is not the plant’s capacity, and there is room for growth.

“We figured it’s going to take us up to half a year to get to 500 head,” Theiler said. “So, I don’t want to get any further than that right now, but down the road there’s so many opportunities. There are a whole host of things that have to be involved. You have to potentially do expansions; you’d have to get additional permits and other things. So, for now, our goal is basically to get to 500 and see how it goes.”

Labor could play a role in how soon True West sees 500 head go through the plant in a day, and while labor continues to concern everyone involved in the food industry, especially processing, Theiler is optimistic. More than 3,000 people attended an open house in February, so the interest and awareness of job opportunities is there. Also, True West Beef has management already in place. The new plant hired a core group of leaders from Washington Beef and relocated them to Jerome.

“They know how to run a plant, and they know culture and the values and all the things that are important,” Theiler said. “We feel like we have a really good leadership team.”

True West management knows initial throughput will be below the 500-head-per-day goal, but with an experienced group of leaders in place, the company is confident it can ultimately hire enough employees to reach that target. The exact number of employees needed remains to be seen.

“We’re going to start somewhere well below 500,” Theiler said. “By the time we get to 500 head a day, we will have the workforce that we need within another six months.”

Agri Beef designed the new plant with a nod to the company’s rich history as a livestock producer, established by Robert Rebholtz and now led by his son, Robert Rebholtz Jr. Two wings that house offices at the front of the new building were designed to convey a ranch look and feel. One wing contains the offices responsible for the plant’s clean side operations and the other side for the harvesting and primary processing offices.

“That design was to honor the ranching background,” Theiler said.

The company views its sustainability efforts as a continually moving evolution. Like most modern processors, True West will always look for ways to improve sustainability. The basics include recycling water used at the plant for use in land application. Almost 95% of the water that goes through the plant will be treated and then used for crop irrigation. Lights in the offices will utilize motion detectors, only coming on when people enter the room and going off when they leave.

“I don’t know if those things are that sexy, it’s just sort of a mind frame, a mindset of trying to do more with less and improving all the time as we go forward,” Theiler said. “And where we start today will not be where we end because there will be more ideas and more things that will come through.”

Another difference at True West is more space on the processing and fabrication lines than what is seen in many processing plants today. Theiler said as a greenfield plant where construction began before COVID and finished during and after the pandemic, the more spacious floor plan reflects the mindfulness of some of the lessons learned during that crisis.

Scarcity of materials and machinery, and sporadic lead times, all played a role in the unconventional decision making involved in building True West Beef. (Source: True West Beef)

 

A new model

The success of Agri Beef’s brands, experience and success on the live side and success and experience in processing all added up to the new business model that would emerge as True West Beef. The evolution occurred when Agri Beef partnered with about 40 of its ranching family suppliers. The partner ranchers’ investment in True West includes a pledge to put cattle through the new plant. After COVID complicated, and in some cases disrupted the supply chain, many livestock suppliers and feedlot operators didn’t know how or where they would get their cattle slaughtered.

“If this type of model were more available across the United States, it would kind of alleviate some of that concern, because you would you know where your cattle was going because you would be a part of it,” Theiler said. “So, I think that’s a big benefit.”

Twenty years of processing experience at Washington Beef has prepared Agri Beef to step into the managing partner role of the True West Beef venture. That understanding of beef processing ensures the rancher partners that the processing side of the business will run smoothly, and all they need to worry about is the business they know, cattle production. The nature of the two sides creates expertise in the fusion of two different businesses from the ranch to the package.

“We have partners who are invested and providing the supply,” Theiler said. “So, we know where the supply is coming from. We know how to make the product as Agri Beef has been in the business of processing since 2003, and then you have the demand side with the brands. Some of our families invested because they knew they would have demand for the product. So, it wasn’t like we had to go create new a new market.”

Of the Agri Beef brands, True West Beef will produce Double R Ranch Northwest Beef, as well as a True West Beef brand. In the future, Agri Beef’s premium Snake River Farms brand might be produced at the new facility, but for now, it will focus on the True West and Double R Ranch brands.

“Those two brands initially with the new brand being something we wanted to give an identity to this plant,” Theiler said.

Agri Beef brands go to both foodservice and retail and like any company, it will try to match the new True West Beef brand to a customer base that looks for the same quality and match production to those customers.

The business model also includes opportunities for producers and feedlots that aren’t equity partners to process cattle through the new plant. True West will offer co-packing opportunities to non-investors for branded programs owned by other producers or cooperatives as well. Whether Agri Beef is branded or co-packed, the Jerome location also will facilitate efficient distribution.

“If you look at the highway system where we’re located, we’re 7 miles north of I-84, which goes over to the West Coast from here, goes straight over to Portland and you can get down to San Francisco, LA, Las Vegas, all the major metros in the West are less than 12 hours from this location,” Theiler said. “So, it’s a good location.”

While supply chain disruptions presented obstacles to construction, True West Beef was completed and expects to be operational in May 2023. (Source: True West Beef)

 

Perseverance for the people

Jerome, Idaho, is in the south-central area of the state in a region known as the Magic Valley. The Magic Valley includes eight counties and is known for a heavily agricultural and food production-based economy.

With only one other beef processing plant nearby, and that one focused mainly on cull cows, True West Beef is the only processing plant in the area for high-quality, fed cattle. Before True West, most ranchers in the area focusing on fed cattle had to transport them a great distance to reach the nearest beef slaughter facility.

“So, those ranchers have got more local production now,” Theiler said. “You’ve also got a sort of pride in having that in the valley, which is really dependent upon agriculture. The people have really supported this venture to have diversification of processing. There’s some pride in being locally owned by multiple partners who are either local or regional with no out-of-state ownership, or foreign ownership. So that’s of course a big reason I think you have a lot of support as well. It’s an Idaho company, owned by an Idaho family, and Idaho families are partners.”

Agri Beef, Schmeeckle Bros. Construction and anyone else involved with the True West Beef project appreciated the support as building the plant through the pandemic was no easy task. The supply chain issues the pandemic caused put massive amounts of pressure on the decisions and decision makers. The timing of the project was not ideal.

“We were making decisions basically within hours of being presented information because either availability or price was going to change dramatically within 24 hours,” Theiler said. “So normally, you would not plan this way, but COVID forced those type of decisions.”

At one point during construction, the team was told a piece of equipment was nine months from being available. Shortly after that, they heard the same piece of equipment was 2½ years out. The team understood the need for the unorthodox decision making and knew they had to commit to it to ensure the plant would ultimately be completed. The lack of availability of materials and equipment also created some opportunities for ingenuity. Sometimes if things were just not available or lead time was just too long, the team would figure out how to build and install what was needed in-house. Which also proved to be useful when it came to financing.

Agri Beef and its partners felt from the beginning the project fit the criteria perfectly for the Meat and Poultry Processing Expansion Program (MPPEP). Agri Beef applied for grant money for the project, confident that it was what the USDA was looking for, but apparently it wasn’t.

“We received no funding for this project,” Theiler said. “So, everything is coming from our own investors and financing. No support from the government.”

Despite the challenges Agri Beef and its partner investors faced from every direction, perseverance will pay off when True West Beef begins production as Idaho welcomes spring 2023.