Dedicated to beef

by Bernard Shire
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John Keating recalls when he began working in a Texas Panhandle beef plant as a teenager. “I painted, cleaned the plant and did other labor-oriented jobs,” he says. “My dad worked in an Excel beef plant and we knew a lot of beef-industry people. I grew up surrounded by the businesses.” Ultimately, he graduated from Texas Tech Univ. in 1987, with a bachelor’s degree in business marketing.

Now president of Cargill Beef, Keating has worked in the meat industry for 25 years, beginning his career with Excel Corporation in 1988 as a production trainee in Schuyler, Neb. Eleven months later, he transferred to the Atlanta sales office and assumed responsibility for Excel’s retail and distributor accounts. He transferred to the corporate headquarters in Wichita, Kan. in 1991, transitioning through various roles before transferring to Cargill Beef Australia in 1996, becoming general manager and assistant vice president in 1998. He returned to corporate headquarters in six years to become president of Excel Food Distribution and three years later was named president of Cargill Meat Solutions’ case-ready business unit. He’s served as president of Cargill Beef for the past five years.

Hard work leads to success

But there’s a lot more to John Keating than simply his advancement up through the ranks of the company. How he was raised is very important to him, and he has been able to use many of those principles of upbringing in his work at Cargill Beef.

“I was raised in small agricultural communities that depended on farming and ranching in order to achieve success,” Keating says with pride. “Growing up, most of my friends were farmers or ranchers and a hard day’s work was expected at a very young age. In a small community, we knew everyone and attempted to treat all folks with dignity and respect, regardless of their socio-economic situation or background. So, I always try to find the value and benefit in our differences as people and treat everyone with respect.”

Morality plays a big role in how he approaches his daily responsibilities. “Absolutely yes,” he says. “At Cargill, my role is very easy to perform as the company has a high set of values and standards,” he says. “We have very clear expectations and guidelines. If a situation arises where there is a gray area, there is support throughout the organization and we get answers quickly. Cargill has been around for 148 years, partly because we always try to do the right thing.”

But that’s not to say there haven’t been great challenges on the economic side the company must face. The ongoing drought conditions have impacted the entire US beef industry.

“Since 1910, we’ve seen significant cattle herd liquidation in Texas and the southern plains, which led to an ample beef supply in the short term, but at increasing costs to produce due to higher than traditional costs, especially feed,” Keating points out. “The increased costs of goods – cattle and beef – impacted the entire supply chain, especially consumers, as the price spread between beef and pork and poultry has continued to increase.”

Unlike poultry and pork, the ability to adjust beef production is not exactly a nimble process. “For beef, there’s one calf per heifer annually and it takes 20-plus months to get to harvest weight,” he says. “Then there are those who speculate, driving up cattle prices. So, cattle producers are not increasing the herd.”

Cargill was impacted more than other beef processors “in that we have two plants in the Texas Panhandle, one in western Kansas and one in Colorado that have been dealing with beef cattle-supply challenges. They’ve been aggravated by the impact of COOL regulations, combined with the [lean] finely textured beef media frenzy last year limited the number of hours we operated some of our plants and resulted in the idling of our Plainview beef processing facility earlier this year. Unfortunately, 2,000 wonderful Cargill people at Plainview were displaced,” he says. “The country-of-origin labeling [COOL] situation must be fixed because the current regulations are problematic. The new regulations will result in significant cost, requiring the industry to invest tens of millions, perhaps hundreds of millions, to meet labeling requirements and labels containing what most consumers would probably find as ‘alarming verbiage.’”

More recently, the issue of using beta agonists in cattle feed has raised questions as to whether this practice is creating animal-welfare issues, causing many processors to discontinue the use of the additives (specifically Zilmax).

While Keating believes it was prudent for Merck to suspend the sales of Zilmax, and Cargill supported that decision, Cargill became part of the independent panel of experts Merck assembled to review the situation. He notes suspending Zilmax as a supplement efficiently converting feed to lean protein will reduce the amount of beef available from each head of cattle the company harvests. So, the spread between beef wholesale and retail prices, and that of pork and poultry, could continue to increase as a result.

When it comes to immigration reform, Keating says it is very hard to forecast what congressionally passed reform might look like, considering the current Washington, DC climate. “It would require a crystal ball and a lot of luck,” he says. “Cargill supports comprehensive immigration reform because it’s long overdue.”

Simple philosophy

Through the challenges and opportunities, Keating has maintained a highly developed, yet simple business philosophy. “We must always take care of our employees and customers to win in our industry. I try to be very sincere in my approach with both customers and employees,” he says.

He uses engagement surveys, HR process audits and site visits, including individual employee interviews, to demonstrate Cargill’s commitment to fairness. “I have always tried to ensure all employees in Cargill Beef feel very comfortable talking not only to me, but to my leadership team,” Keating says.

Tied to his philosophy is the important role of leadership. “It’s a privilege and should never be taken for granted. I have tried to refine my style, while trying never to change who I am inside. I also believe every day is a great day – although some days are better than others,” he concludes.

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