Walmart acquires minority stake in processor Sustainable Beef

Dive Brief:

• Walmart announced on Wednesday it has agreed to acquire a minority stake in Sustainable Beef LLC. Walmart did not disclose how large the stake is, the cost of the deal or when it’s expected to close. 
• As part of the partnership, the retailer will help the rancher-owned company open a beef processing facility in its hometown of North Platte, Nebraska. The facility is expected to break ground this month ahead of a planned opening in late 2024.
• Walmart said the partnership is its newest step toward increasing access to high-quality, affordable beef and will also benefit the beef industry and cattle ranchers.

Dive Insight:

Walmart’s work with Sustainable Beef builds on the retailer’s progress toward building out an end-to-end Angus beef supply chain. Walmart has said previously that partnering with a variety of companies on this endeavor allows the retailer to secure its supply and provide more transparency for customers.

Now, Walmart is highlighting the cost benefits it can pass along at a time when high food prices have pinched shoppers’ wallets, noting multiple times in its announcement that building out its own beef supply chain will provide more “affordable” options to customers.

Sustainable Beef will work with cattle feeders and ranchers on the supply chain cycle to gain insights on areas such as grain sourcing and grazing management, Walmart noted. The retailer also stated that Sustainable Beef will follow its standards on animal welfare and the responsible use of antibiotics.

The upcoming Sustainable Beef facility, which has been two years in the making, will create more than 800 jobs.  

“This investment provides greater visibility into the beef supply chain and complements Walmart’s regeneration commitment to improve grazing management,” Tyler Lehr, senior vice president of merchandising for deli services, meat and seafood at Walmart U.S., said in the announcement.  

Lehr said that Sustainable Beef takes a responsible approach to beef processing that “includes creating long-term growth for cattle ranchers and family farmers.”

As part of the deal, Walmart said it will gain representation on Sustainable Beef’s board of directors. 

At the start of 2020, Walmart announced the opening of a facility operated by FPL Food in Thomasville, Georgia, that is part of the beef supply chain program the retailer has been building out in recent years. Last June, Walmart launched a private label beef line called McClaren Farms in stores across the Southeast that is also part of its beef supply chain efforts.