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Scott Lively stands in front of the Dakota Beef plant in Howard. Production is anticipated to begin by August.
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Dakota Beef Company, LLC, is processing a commodity not so much in demand in the Midwest as it is on the East and West coasts.
The plant will be processing organic beef -- beef raised without the use of hormones, antibiotics and HMOs, and raised on organic feed.
"I'm so excited for Howard to be a part of this," said Dakota Beef President and CEO Scott Lively.
Howard residents first heard the plant was coming to the area last October. The plant will be located in the 20,000-sq.-ft. building on the eastern edge of town. The plant was formerly used as a beef processing facility in the 1990s and then as storage for a local implement dealer.
At full capacity, Dakota Beef will have the capabilities of processing more than 80 head of cattle per day or 70,000 pounds of organic beef product, and employing at least 40 workers.
The plant will begin with limited production, however. Lively said the plant will start production with the completion of phase one before August.
"We're hoping by August to have phase one done, and we'll be taking quarters in, breaking quarters, packing and selling them out," Lively said.
Lively is anticipating five to 10 employees at first and the completion of phase two within four months.
Phase two includes finishing the fabrication area, kill floor and incorporation of its traceability program.
With that program, Lively said, he can pick up any pack of meat and tell a customer who the producer was, where it was raised, the breed history, feed and when it was processed.
"Through this system, we'll know where every piece of meat is at any time," Consultant Tony Brady said.
"It's not part of the organic concept, but it's keeping the plant ahead of the industry for food safety and food quality," Brady said. "And it just complements the organic program. By having traceability, you're assured that product is tracked through the entire system."
Farmers in the United Kingdom are already required to track animals in this fashion, Brady said, and eventually the United States will require the same.
Although the company is new to Howard, it's not a business that's just beginning.
"A lot of people are under the misconception that we're a start-up company looking to start up business here. The situation is, we are an existing company," Lively said, indicating that the company started three years ago and has 18 months of proven revenue.
"We've been outsourcing all our processing to a facility in Omaha, Neb. What we bought this for was to move processing here and stop outsourcing it. To bring it in-house, we bring the cost of processing down, lower the cost of our product, and that's enabling us to create jobs in Howard."
But there's more to Dakota Beef than processing organic meat.
"The idea is the true fully integrated (system) -- owning your cattle at an early stage, knowing what's going into the cattle, processing them yourself and selling them directly to retailers," he said.
Dakota Beef is sold at Whole Foods, Trader Joe's, and in 10 restaurants in every major city -- Chicago, San Francisco, Washington, D.C., New York City and Boston. It is the only beef listed in the William-Sonoma catalog and the exclusive beef used for Earth's Best baby food.
Dakota Beef has a contract guaranteeing exclusive rights to provide beef for the baby food for two years, he said.
"Our market is not South Dakota," Lively said. "Our markets are upscale, gourmet...that's our market. Selling beef here is like selling seafood in the Atlantic. It doesn't make sense; beef's fine here. I'm not against traditional beef...but I know there's a market out there for very label-conscious people, (who) are very concerned about what's in their food, (who) are very concerned about health and what not, and they want organic beef, and those markets are San Francisco, New York, Boston and Chicago."
The Howard location, however, is close to where the company's beef is raised. Lively said the company has one feed yard in Yankton, and they are working with a Madison farmer to develop another.
The plant in Howard is one of three Lively hopes to open. He said he is currently looking at other potential locations but doesn't intend to purchase more until phase two is completed at the Howard plant.
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