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[source: Pat Morris via AIM_AUTONOMOUS_PA@onelist.com]

Mon, 14 Feb 2000
http://www.ardemgaz.com/today/biz/D1bbuffalo14.html

Buffalo herds flourish with demand for meat
BRENDAN MURRAY
BLOOMBERG NEWS

CHEYENNE RIVER SIOUX NATION, S.D. -- Sitting on his
horse, Fred Dubray looks across the South Dakota grasslands
at the buffalo milling about in the snow. They fed his
ancestors and now may provide a livelihood for his tribe.

"The buffalo had always been an economic resource for us
until it was stripped away," said the 49-year-old Sioux,
whose tribe is harvesting buffalo meat for the first time in
generations. This time, the Sioux are building a business
around creatures that almost disappeared. The Cheyenne River
Sioux Nation expanded its herd to 1,500 head from just 100 a
decade ago. Dubray, a former cattle rancher, envisions a
herd of 5,000 in a few years. That would be one buffalo for
every two members of the tribe, which has its own mobile
slaughterhouse. It processed $100,000 of buffalo meat last
year.

Once hunted nearly to extinction, the buffalo is making a
comeback. Raising and slaughtering the animals has become a
$500 million industry as buffalo steaks and burgers show up
on menus at Western mountain lodges and tony East Coast
restaurants.

"I see a tremendous growth potential," said Stuart Cutler,
president of Thunderpride Buffalo, a distributor of the meat
in Staten Island, N.Y. "The biggest problem for me right now
is not being able to produce enough."

The popularity of the meat is growing. Safeway Inc.,
the third-largest U.S. supermarket company, carries buffalo
meat in some Denver-area stores, a spokesman said. The White
House served grilled buffalo filets to NATO dignitaries last
April.

'OUTSELLING HAMBURGERS'

"Buffalo burgers on our lunch menu are outselling the
hamburgers," said Jim Burnett, executive chef at Fiddler's
Elbow Country Club in Bedminster, N.J. Since buffalo went on
the menu six months ago, "we've been selling it much faster
than I imagined."

The promise of rising demand has made buffalo, or bison, a
popular niche market for some investors. Billionaire Ted
Turner is the industry's largest producer, and lots of
nonfarmers have bought their own herds.

Turner has about 16,000 bison, the largest private herd. The
U.S. herd is growing about 15 percent a year, as more people
try the red meat that's generally leaner -- and tastier,
some say -- than beef, chicken and some fish.

The total U.S. bison herd has grown to about 250,000, triple
the number a decade ago, after falling below 1,000 in the
late 19th century. The herd once was estimated to total 60
million. That's about twice the size of the current beef
cattle herd, which is worth about $26 billion at today's
prices.

JOINING CENSUS

The buffalo herd is multiplying so rapidly now that the U.S.
Department of Agriculture plans to track it for the first
time in 2002, making bison part of its census of the
nation's livestock, such as cattle, hogs and poultry.

Many buffalo are being raised by farmers, including some who
are looking for new ways to eke out profits during the
prolonged slump in the price of many crops and some
livestock.

The majority of buffalo are raised on private ranches, and
not just in Plains states. About 10,000 now reside on
American Indian land, up from just a few hundred used mainly
for religious or ceremonial purposes in the late 1980s.

In January, a Colorado rancher paid a record $52,000 for a
female bison at a trade show in Denver, a sign that the
industry's growth may not slow any time soon. The average
female bison costs about $4,000,  compared with about
$750 for a cattle heifer.

"There's still excellent demand for quality breeding
stock," said Samuel Albrecht, executive director with the
National Bison Association in Denver. A bison bull recently
sold for $90,000, just shy of the $100,000 record, he said.

HIGH COST

Although the herd is getting bigger, demand for buffalo meat
hasn't grown as fast, partly because it sometimes costs
twice as much as beef. Geography has also been a hurdle:
Consumption is growing fastest on the East and West coasts,
while the biggest herds are in North Dakota, Montana and
Colorado.

"We've got to work now to develop our meat business," said
Mike Torp, owner of Stony Creek Bison Ranch in Forestville,
Wis., which has a herd of 90. "We have to do more
promotions, go to restaurant trade shows and educate the
public that the buffalo isn't extinct."

It has a long way to go.

In 1996, about 7.5 million pounds of buffalo meat was
produced. That's 0.36 percent of the 2.1 billion pounds that
cattle ranchers produced last year. And one of the biggest
challenges is persuading consumers to eat an animal that
has become an icon of Americana, idealized on the nation's
postage stamps and coins.

"The buffalo is as American as apple pie, John Wayne and the
American flag," said Will McFarlane, owner of the Denver
Buffalo Marketing Co. The 10-year-old company, the world's
largest marketer of buffalo meat, has annual sales of about
$7 million.
 

STRONG IMAGE

That image has been an asset in gaining some government
help. Two years ago, the supply of bison meat overwhelmed
demand, threatening to sink prices.

Producers, mainly small farmers and ranchers, asked the
government to bail them out.

The Department of Agriculture spent as much as $8.5
million in 1999 and 1998 on ground bison meat to prop up
prices, distributing it through food assistance programs. A
decline in prices could have forced many bison ranchers to
quit, and the government intervention highlighted the
industry's need to increase demand.

"We're trying to compete with lamb, duck and lobster, which
appeal to more urban, upscale consumers," said Dennis
Sexhus, chief executive of the North American Bison
Cooperative, which operates a slaughterhouse in New
Rockford, N.D.

Bison aren't domesticated like cattle and hogs and raising
them isn't easy. A fully grown buffalo can weigh up to 2,000
pounds, almost double the weight of a fattened steer. They
can run almost 30 miles an hour; they jump and have horns.

"You can walk up to a cow and pet it," said Scarlett Doyle,
vice president of Readington River Buffalo Co., a ranch near
Flemington, N.J. "You should never even walk up to a
buffalo." It's too dangerous,  she said.

Some ranchers are trying to domesticate buffalo by cutting
off the horns, confining the animals to feed pens and
vaccinating them against diseases.

That's the wrong way to treat buffalo, the Sioux's Dubray
said. While he understands the need to make ranches more
productive, preserving the animal's mystique is one reason
to raise them.

"If you can consume something that powerful, then you can
become that powerful," he said.
 

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