Cargill will sell two beef and cattle feed yards in Texas to free up capital for midstream protein investments.
The yards at Bovina and Dalhart will be sold to Friona Industries for an undisclosed sum, subject to approvals.
John Keating, president of Cargill’s Wichita-based beef business, said, “Selling our feed yards in the Texas panhandle allows us to redeploy many tens of millions of dollars annually into investments that will help us grow our protein business – money that otherwise would have been tied up as working capital used to purchase and feed cattle.”
“We believe it is wise to redeploy capital away from feed yard and cattle ownership to projects that enhance our capabilities and provide greater value to our customers and consumers, now and in the future.”
In the past year, Cargill has invested $500 million in in beef-processing, cooked-meats and beef-distribution operations, according to the company’s website. The feedlots will continue to supply cattle to Cargill’s beef processing plants, and the roughly 90 employees at the yards will be offered jobs with Friona.
Demographic trends will drive up protein demand in the coming decades, so investors’ strategies include plays aimed at meat substitutes, sustainable-livestock operations and feed-grain production.
Friona is a privately held cattle company with feed yards in north Texas.