Understanding Beef Processing Costs

Processing can represent a significant part of a farm-direct beef transaction, and the way a processor calculates charges can affect both your pricing and the customer’s final invoice.

Ask for the complete fee structure

Processors may charge separately for different services. Depending on the facility and order, these can include:

• Slaughter or kill fee
• Cutting and wrapping
• Vacuum packaging
• Grinding
• Patties or specialty products
• Sausage, smoking or curing
• Disposal or rendering
• Extra aging
• Storage
• Delivery or other services

Not every processor offers the same services or uses the same pricing structure.

Know which weight is being charged

Cutting and wrapping is often calculated using carcass or hanging weight, but producers should confirm the processor’s actual method.

Make sure the customer understands whether your farm price and the processor’s price use the same weight basis.

Decide who pays the processor

Some farm-direct businesses include processing in the customer’s total price. Others charge for the animal separately and have the customer pay the processor directly.

Either model can be understandable if it is explained before the order is placed.

Inspected processing matters when meat is sold

Alberta states that meat or meat products sold or distributed in the province must come from an inspected slaughter facility or processing facility. Uninspected meat produced through an On-Farm Slaughter Operation is restricted to the animal owner or owners and their households and cannot be sold or further distributed.

Review costs regularly

Processor fees, fuel, packaging and livestock production costs change. A farm-direct price built around outdated processing charges can quickly become inaccurate.