KANSAS CITY, Mo. – Eric Brandt is the young and charismatic CEO of Brawley, California-based One World Beef, which operates as OWB Packers LLC. He is a rock star in the eyes of the 179 people who currently staff the company’s storied beef processing plant. According to Brandt, the real rock stars are the workers themselves. He knows most of them by name and their history with the plant. Some date back to when the plant opened in late 2001 and endured several ownership changes and an eventual closure of the facility.
The plant originally opened after eight cattle feeder/owners in the Imperial Valley of southern California and Arizona realized their long-held dream of having a world-class beef plant in the valley. Cattle feeding and crop farming have long dominated the valley, but the cattle feeders saw their marketing options diminish every time a beef plant closed in Vernon, California (part of Los Angeles). So they invested more than $80 million of their own money to build the plant. They even named the company Brawley Beef LLC after the city.
“We are proud of our community and want to show it on every box we produce,” member/owner Bill Brandt said at the time. His father began farming in the valley in the late 1930s and the family now grows crops and vegetables on about 5,000 acres. The family also operates the valley’s largest feedlot, which has pen space for 115,000 cattle. All of them are calf-fed Holstein steers.
Brawley Beef, however, had the worst kind of break in December 2003. The US found its first case of Bovine Spongiform Encephalopathy and nearly all export markets closed to US beef. Brawley had hoped its source-verified Holstein beef would give it an advantage in Japan over other US beef, but that market remained closed (until 2007) and Brawley Beef never recovered from the blow.
The inevitable end came in March 2006 when Brawley’s seven remaining owners agreed to sell the business to fourth-largest beef processor National Beef Packing, based in Kansas City, Missouri. At the time, Brawley’s sales were about $400 million per year and it processed about 400,000 cattle annually. Brawley’s owners exchanged the company’s assets for an ownership interest in US Premium Beef, then National’s majority owner.
National operated the Brawley plant for the next eight years, but the plant struggled with a declining supply of fed cattle and faced operating losses for the foreseeable future. National’s majority owner, Leucadia National Corp., decided to close the plant and its last slaughter day was May 23, 2014. National had spent another $60 million on the plant and at one point valued it at more than $130 million.
THE DREAM LIVES ON
However, the Imperial Valley’s cattle feeders refused to let their dream die. They knew that closure was a disaster for the valley’s cattle feeding industry and a catastrophe for the community. The plant had employed about 1,300 people and they were now out of work in a region where the unemployment rate was 28 percent, the highest of any county in California. So the cattle feeders worked non-stop to find a way to get the plant reopened.
That day came closer on April 14, 2015, when National announced an agreement to sell the plant to One World Beef. Eric Brandt had started One World, originally based in Buena Park, California, in 2013 and had carved out a niche as a meat sales and marketing agent. It was distributing top quality beef products to high-end restaurants, chefs and meat purveyors across the globe. It began by selling beef under the Brandt Beef-The True Natural brand and also imported Wagyu beef from Japan under the Kagoshima brand. The company still does this.
Brandt and his backers, however, faced a long, complicated journey in raising capital and getting the plant approved to reopen. The company’s efforts received strong support from several local agencies and other entities. But the Brawley’s city manager obstructed the company’s efforts at every turn, and does so to this day, Brandt says.
Read more about One World Beef’s investment in the Brawley plant in the April issue of MEAT+POULTRY.