January 5, 1999 | By: Mark Eclov

The American farmer has long been touted as a hard worker with an independent nature. As market demands change, however, it may be more profitable for farmers to join some non-traditional marketing alliances.

"Group marketing has long been associated with the large grain and milk cooperatives that have formed to help balance out prices, but a new alternative has appeared in Kentucky in the form of smaller, locally controlled group associations," said Lee Meyer, Extension marketing economist in the UK College of Agriculture Cooperative Extension Service.

"Group marketing for Kentucky's small hog and feeder cattle operators makes sense for a couple of reasons. One is the balancing of market power and this other is cost savings," Meyer said.

"For hog producers, group marketing allows producers to sell their product over a much larger area, perhaps reaching out over two or three hundred miles," said Meyer. "This arrangement also allows hog producers access to carcass-based sales."

Meyer pointed out that feeder cattle producers who combine efforts can sell feeder calves in larger groups with occasional savings of ten to 20 percent. "At sales time, it allows the smaller cattle producer to pool loads of similar cattle which reduces the costs for everyone in the marketing system, and allows producers to seek a higher price from buyers, " added Meyer.

Meyer noted there are currently three hog and fifteen to twenty feeder cattle marketing groups operating in Kentucky.

"The Kentucky hog producer groups have been around for a number of years now and they not only market their products, but buy feed and equipment as a group to reduce costs," said Meyer. "Kentucky feeder cattle marketing associations also buy larger quantities of farm inputs as a group and also market their cattle through special feeder cattle sales, satellite sales and a whole range of other sales opportunities."

Meyer emphasized that successful marketing groups are based on finding a good leadership base and identifying who can make the day-to-day decisions necessary keep things running.

There is no magic formula to form a marketing group. "The place to start is just to try getting something done," suggested Meyer. These initial efforts will foster working relationships with other producers and may provide the impetus for a more sophisticated marketing effort that helps everyone increase their bottom line.

Producers who may be interested in joining a local association, or who may want to review the potential of starting up a hog or feeder cattle marketing group in their area, should check with their county Extension agent for additional information.

"If some of our Kentucky farmers are willing to give up a little bit of their independence they may be providing a more secure financial future for their individual operations" Meyer said.

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Contact: 

Writer: Mark Eclov
(606) 257-7223

Source: Lee Meyer
(606) 257-7276