New Beef Processing Capacity Reshapes Kansas Cattle Economics

A round of investment in regional beef processing is beginning to reshape the economics of the cattle business in Kansas, giving ranchers and feedlot operators more places to sell and, they hope, better leverage on price.

For years, a small number of large packers dominated the market, and producers complained that consolidation left them with little bargaining power. Newer, mid-sized plants, some backed by producer cooperatives, aim to add competition and to keep more value in the state.

"When you have more than one buyer at the table, the whole dynamic changes," a feedlot manager in southwest Kansas said. The plants also create local jobs in communities that have long depended on the cattle economy.

Analysts caution that building and staffing processing capacity is difficult, and that the new entrants will have to prove they can operate efficiently at scale.