Rancher seeks to buy shuttered slaughterhouse
Published: Thursday, February 20, 2014 at 3:08 p.m.
Last Modified: Thursday, February 20, 2014 at 3:08 p.m.
Marin Sun Farms, a gourmet farm-to-table meat producer, is buying the Petaluma slaughterhouse at the center of an international meat recall and intends to reopen the shuttered facility.
Marin Sun founder and CEO David Evans on Thursday said he has a deal in escrow to purchase the plant operated by Rancho Feeding Corporation, which ceased operations this month and recalled all 8.7 million pounds of beef processed at the plant in 2013.
Evans, a fifth-generation Marin County rancher, said the purchase will encourage the growth of the North Bay's custom meat producers. He intends to expand operations to slaughter species other than cattle and to process organic-certified meat.
“This is a game changer,” Evans said. “This will transform the future of livestock agriculture in the surrounding area.”
Financial terms were not disclosed. Evans said the deal involved “several million dollars.”
Robert Singleton, who owns the Petaluma plant and operates sister company Rancho Veal, on Thursday confirmed efforts to reach an agreement.
“It's in the works,” Singleton said. “Nothing completed, but it's in the works.”
Rancho Feeding, operated by Singleton's partner Jesse “Babe” Amaral, initiated a recall last month that has spread beyond local markets and custom-beef ranchers to national chains such as Walmart, Kroger and Food 4 Less.
More than 1,600 food distributors in the United States and Canada are now named as part of the recall, asking consumers to return such products as beef jerky, taquitos, hamburger patties and Hot Pockets frozen sandwiches.
The U.S. Department of Agriculture has asserted that Rancho “processed diseased animals” without a full inspection. Two different USDA offices are conducting investigations of the company.
The USDA has not received any reports of illness linked to the meat.
Marin Sun operates ranches near Inverness, butcher shops in Oakland and Point Reyes Station and a meat-cutting plant in San Francisco. Evans recently was named Outstanding North Bay Rancher for the upcoming Sonoma County Fair.
Local farm leaders, who long feared they might lose the region's last slaughterhouse, on Thursday applauded news of Evans' plan to buy the plant and broaden its operations.
“This is really like a dream come true,” said Tim Tesconi, executive director at the Sonoma County Farm Bureau. “The whole livestock industry has been looking for this for 20 years.”
Rancho is a small processor of older dairy cows and pasture-fed beef, the latter a growing niche that commands a premium price at high-end restaurants, butcher shops and farmers markets. In the last year or so, the plant has expanded to processing hogs.
But for many the plant's future was uncertain, even before the recall. In 2006, Singleton announced plans to sell the four-acre property for a housing development, but the deal floundered several years later amid an historic housing market collapse.
About 2010 or 2011, Evans said he presented a plan to buy Rancho at a Slow Money conference, a gathering of investors who want to back sustainable food entrepreneurs. His aim was to raise $3 million for the purchase.
Evans said he devised the plan because he was unsure of Rancho's future and he dropped it when the processor announced plans to slaughter hogs and take other steps to boost its profits.
“It was looking more stable,” he said of Rancho.
Evans' immediate aim is to resume operations as soon as possible so North Bay ranchers once more have a local place to slaughter their cattle and hogs.
“We want to get all those people back up because so many small businesses are being hurt by this,” he said.
But he wants to win organic certification for the plant by the summer of 2015 and eventually to be able to slaughter sheep and goats along with cattle and hogs.
Along with slaughter and processing, he plans to offer ranchers cut-and-wrap services, labeling and distribution of their products.
“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.
He hopes Marin Sun will become a $50 million business in six years. Evans maintained he would assume none of Rancho's debts related to the recall.
To operate the plant, Evans will need to obtain a “grant of inspection” from the USDA. The process normally takes weeks to obtain and involves both on-the-ground inspections and the filing of detailed documents, including a food safety plan known as a Hazard Analysis Critical Control Point plan, or HACCP plan.
For ranchers, slaughtering animals has been the weak link in the North Bay's production system. To harvest their meat, farmers tell of taking chickens to Stockton, hogs to Modesto or Orland, sheep to Dixon and rabbits to Turlock.
Organic meat production also has been hindered by the lack of a certified processing plant. Farmers have the animals and the pastures certified, and Evans' proposed organic facility would amount to the last piece in the puzzle, said Stephanie Larson, director of the UC Cooperative Extension in Sonoma County.
“And that would be huge,” she said.
David Rabbitt, the Sonoma County supervisor who represents the Petaluma area, said Marin Sun's purchase would be an ideal way to reopen the plant.
“Without that,” Rabbitt said, “it would certainly put a hole in our agriculture infrastructure.”
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