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New slaughterhouse owner seeks new approach


Fourth-generation rancher David Evans remembers the "tidal wave of demand" for pasture-raised meats that followed Michael Pollan's 2006 book on the U.S. food system.

"We got inundated," he recalled of the publication of "The Omnivore's Dilemma."

Evans has spent years building a regional system to serve the small but growing number of Bay Area residents who want an alternative to conventional meat production. As the owner of San Francisco-based Marin Sun Farms, he takes an approach that differs markedly from the mainstream meat industry, which typically relies on antibiotics, cattle feedlots and poultry warehouses.

Evans' recent purchase of a recall-shuttered slaughterhouse in Petaluma has allowed him to add a critical piece to his meat production system. With his plan to reopen the former Rancho Feeding Corporation plant, he seeks to tie together a food chain that includes local ranches, a San Francisco meat cutting plant and two Bay Area butcher shops — essentially moving beef, pork and other meats from pasture to plate.

For North Bay ranchers who feared the region's last slaughterhouse would never reopen, reaction to the plant's purchase is largely positive, albeit some privately worrying how Evans will treat rival businesses.

Evans maintained he will treat everyone fairly and said the plant's reopening will allow beginning and veteran ranchers to take the next step forward in a niche business that can be far more profitable than selling cattle and other animals for commodity meats.

Under his control, he plans to add organic processing to the services he can provide ranchers. However, unlike the former owners, Evans doesn't intend to purchase older dairy cows and other cattle for the conventional meat market. That means dairy farmers and possibly some other ranchers will lose a key buyer of their animals.For Bay Area residents, Evans predicted the plant will provide more healthy, sustainable meat choices and can help transform the nation's food system that often boils down to "bigger, faster, cheaper." He insisted he isn't "anti-conventional" production, but he also told KQED radio</CW> that "the food system is way behind the times, and there's so much room for improvement. Let's make that happen."

For Evans himself, controlling the plant will help him reach a goal of expanding his business to $50 million annually in revenues within six years.

"With risk comes rewards," he said. "There's a lot of risk in this. I'm a risk taker."

Evans, 41 and a Cal Poly San Luis Obispo graduate, belongs to a small group of Marin County entrepreneurs who grew up on family farms but branched out to satisfy a growing demand for niche food products. They include organic dairy and creamery owner Albert Straus, grass-fed beef and lamb rancher Loren Poncia and Evans' sister, Julie Rossotti, a grass-fed veal and goat rancher.

"They really are thinking much differently than their parents or my generation," said Mike Gale, 72, who with his wife Sally owns Chileno Valley Ranch, a grass-fed beef operation west of Petaluma.

For years, Evans has pursued vertical integration in his business — essentially controlling as many steps as possible of meat production, from raising the animals to killing them, cutting up the meat, packaging it and selling it directly to customers.

"Going vertical, as Dave has, has been the smart thing and the very successful thing for him to do," Gale said.

Evans started raising pasture-finished beef in 1998. He opened a butcher shop and restaurant in Point Reyes Station in 2005, later added another butcher's shop in Oakland's Rockridge Market Hall, and last summer took over what is San Francisco's biggest facility for cutting up, or "breaking," animal carcasses.

He sells his ground beef to Stanford University Hospital and his meats to a variety of Bay Area restaurants.

Marin Sun items cost substantially more than what's sold in a typical supermarket meat case. Evans told public radio listeners that he considers his "a completely different product."

His website lists $24.95 for a pasture-raised chicken, $10 for a pound of ground beef and $35 for up to 2 pounds of pork tenderloin.

About three years ago, Evans put forth a proposal for purchasing the Petaluma slaughterhouse to a group of potential investors. He said recently he made the pitch because he was unsure of Rancho's future but dropped the idea when the processor announced plans to slaughter hogs and take other steps to boost its profits.

Last month, Evans was able to put together a group of investors to buy for "several million dollars" the former Rancho plant. The deal closed Feb. 28, he said.

The purchase comes amid ongoing federal investigations of the closed plant, which is under recall for all 8.7 million pounds of beef processed there last year. The U.S. Department of Agriculture has asserted that Rancho "processed diseased and unsound animals" without a full inspection.

The recall still could cause significant losses to some ranchers, including Evans, if their frozen meat must be destroyed. Some ranchers met Friday with USDA officials in Petaluma in an effort to have their meat deemed safe.

Also, the plant's closure has forced beef and pork producers to transport their animals much farther for slaughter.

Most of Evans' investors in the Petaluma plant have remained anonymous. But they include San Francisco tech entrepreneur and investor Ali Partovi, whose financial ventures have included Facebook, Dropbox and Pinterest. Partovi also is Marin Sun Farms' sole outside investor, Evans said.

The slaughterhouse that Evans is taking over and seeking federal permission to reopen is by all accounts a small operation. Adam Parks, owner of Victorian Farmstead Meat Co. in Sebastopol, compared the 8.7 million pounds that Rancho processed last year to the over 150 million pounds produced annually by Fresno County's Harris Ranch, which calls itself the state's largest fully integrated beef operation.

While precise data doesn't exist, pasture-raised beef and other unconventional meats probably make up less than 2 percent of the nation's meat consumption, experts said.

But just as organic milk, fruits and vegetables over time have become more popular, grass-fed beef and other alternatively produced meats are growing in consumption.

"You're seeing more and more of these products showing up in grocery stores, and people are buying them," said Arion Thiboumery, vice president at Lorentz Meats, a meat processor in Cannon Falls, Minn.

Thiboumery is a coordinator in the Niche Meat Processor Assistance Network, which includes more than 800 processors and livestock producers. He estimated that niche meat sales typically are growing by 10 to 20 percent each year.

Meanwhile, consumers, regulators and companies have shown a sensitivity to issues raised by alternative-food enthusiasts.

Last month, fast food restaurant Chick-fil-A announced that within five years it will serve chicken raised without antibiotics in all of its restaurants. The announcement follows the U.S. Food and Drug Administration's efforts to reduce antibiotics in food production because scientists believe the practice contributes to the rise of drug-resistant bacteria strains that pose a major threat to public health.

Experts said the Bay Area is one of the better places in the nation for niche meat operations.

"This is a region that is committed to its farmers and its meat," said Lauren Gwin, an assistant professor at Oregon State University and a coordinator of the niche meat network.

Just as Evans has a different vision of meat production, he is planning to run a different type of operation at the Petaluma slaughterhouse.

The former owner slaughtered cattle and swine on a custom basis for North Bay ranchers who then took the meat and sold it to restaurants and grocery stores and at farmers' markets. But most of the plant's work involved cattle, including older dairy cows, that its partners had purchased from a wide region.

As the recall has made clear, the meat from those animals found its way into such varied frozen products as Hot Pocket sandwiches, taquitos and hamburger patties.

Evans is proposing a marked change in operations. He still will offer custom slaughter, but he plans to buy only cattle that meet his standards, which include animals that are grass fed, humanely treated and raised by those who care well for their land.

"We're not going to be buying animals to sell to the Jack in the Box trade," he said.

Evans acknowledged that local dairy farmers will have to find another buyer than the slaughterhouse for their older cows.

Even so, he insisted his operation will provide new opportunities for meat producers. Marin Sun will be able to help ranchers kill, butcher, package and market their meat, allowing them to develop their own brands and labels if they so choose.

"We're going to have a suite of services to offer those North Bay producers to get their products to market in a way that has never been offered before," he said.

Evans recently wrote he is "cautiously optimistic" the plant can harvest its first animal by March 31. He hopes to obtain organic certification by year's end and to eventually slaughter sheep and goats as well as swine and cattle.

Santa Rosa organic dairy farmer Doug Beretta said North Bay farmers now will find it more difficult to sell their older dairy cows. Even so, he pointed out that Evans' proposal may offer new business ventures for the region's organic dairy farmers.

For example, he said, such farmers one day might keep their bull calves and raise them to produce "North Bay organic ground meat."

"It's still better to have that plant there and have some opportunities down the road than closing it up," Beretta said.

Some ranchers and butcher shop owners are privately worrying about Evans' ownership of the slaughterhouse, sources said. Some fear he eventually might force ranchers who use the slaughterhouse to sell their animals to Marin Sun Farms or to require that they use more of his services, including his San Francisco meat cutting plant.

In response, Evans recently wrote on the Marin Sun website that ranchers will be free to choose only those services they wish.

That approach made sense to outside observers, who said Evans faces a huge challenge in attracting enough ranchers to use the slaughterhouse. If he doesn't win their business, he risks not having enough work to pay for both the skilled meat processors and the federal inspectors that such a plant requires.

"I think Dave is a savvy enough businessman," said John Harper, a livestock adviser for the UC Cooperative in Ukiah. "If he starts limiting it only to his product line, he may not have the volume (he needs)."

Rancher Tara Smith of Tara Firma Farms near Petaluma said she doesn't worry about Evans' plans. By purchasing the slaughterhouse, "he saved my business," Smith said.

The Bay Area still has a vast number of potential customers for niche meats, she said. As such, Smith suggested ranchers and processors should collaborate on expanding their markets rather than seeing one another as competitors.

"Dave can't support and supply all of these people," Smith said. "He can't. He's offering me a chance to stay on my feet."

(You can reach Staff Writer Robert Digitale at 521-5285 or robert.digitale@pressdemocrat.com.)