Impact of Beef Prices
Episode Details
Transcript
Part 2: Beef prices keep climbing, and it’s forcing Texas BBQ joints to make hard calls. Justin Fourton (Pecan Lodge), Wayne Mueller (Louie Mueller Barbecue), and Nick Pencis (Stanley’s Famous Pit BBQ) talk about readjusting menus — portions, pricing, and what stays (or gets cut).
Is brisket becoming a luxury, and can Texas BBQ survive this?
Speaker 0
I want to remain optimistic. I don't ever wanna be like, oh, man. Our business is in jeopardy. I feel that way sometimes. Mhmm. I wake up at night and I'm and I I'm freaking out. Because at some point, the Texas trinity, the brisket, the ribs, and the sausage kind of stops being lunch and starts looking like a luxury steak dinner. Speaker 1
We've adjusted our menu structure to try to offer more items that are outside of the what you would consider, like, the traditional trinity. Speaker 2
Not only do you have to enjoy the cuisine, you have to have the disposable income in order to participate. Speaker 0
Hey, everybody. Welcome back to Smokeless. I'm Nick from Stanley's Famous. I'm sitting here with the usual suspects, Justin from Pecan Lodge and Wayne from Louie Miller Barbecue. Guys, when we taped part one of this beef crisis conversation, I mean, damn, it was late last year. We were all kind of looking around the room for a boogeyman. We knew the prices were insane. We knew the big four were acting shady, and, we knew the math at our barbecue joints was starting to look super scary. Well, welcome to February twenty twenty six. The fog has cleared, and the view is honestly that it's still pretty bleak. Since we last spoke, the big four have stopped just hinting at trouble and started bleeding out in public. Tyson disclosed one of the biggest plants in the country in Nebraska because they literally can't find enough cows to keep the lights on, allegedly. They're projected to lose half a billion dollars this year, all while you're paying nine bucks a pound for ground beef at the grocery store. It just feels icky. It feels like a setup. Even so, the Department of Justice is finally starting to kick the tires on a price fixing investigation. We don't know if anything will actually overcome with that. But here's the kicker. And, Wayne, I know that you're gonna have a field day with this. This was something we were all really scratching our heads about. But as of January first, and I just found this out on the airplane today, the rules have changed. The product of USA label on beef actually has to mean something now. No more bringing in cheap beef from overseas, slapping a flag on it, and calling it domestic. Apparently, that loophole has closed, and we need to take a deeper dive into that in a bit for sure. But at the end of the day, we're still staring at a US cattle herd that is at a seventy five year low. So today, we're digging into the second half of this mess. We're moving past the why and getting into the what now. Because at some point, the Texas trinity, the brisket, the ribs, and the sausage, kinda stops being lunch and starts looking like a luxury, steak dinner. So how is that supposed to work? How long will people accept that? Wayne, Justin, last time we said this was unsustainable. Well, here we are. The new normal is officially here. How much longer can we keep this going before the math burns the whole thing down? Let's get into it. What happens when barbecue tourists or regular families that come in for brisket in that tray, the price just feels insane. Woah. Do we start taking reputational damage as a whole industry? More, this place is too expensive reviews. I just don't know if people really understand what's going on. Speaker 1
I mean, I I think we're at that inflection point right now. You know, if you if you there have been several articles that have come out lately, in Texas Monthly about interviewing people that have closed down their restaurants. I think there have been seven Yeah. Speaker 0
At Speaker 1
a minimum since the beginning of the year. Mhmm. On a similar perspective, you've you've got Daniel talking about the number of half chickens that he's being he seems being sold at restaurants, you know, and it looks like people are making that choice for some of the the lower cost options for sure. Speaker 0
They're also just very delicious. They are really good. Only stars are pretty good. Speaker 1
You know, the question has has been, you know, is is are those adjustments enough to to make a difference? You know? Can you change the product mix and survive this? Or at some point, is it just too much for people to handle? I mean, it seems Speaker 2
like it's It's a gradient scale, though, isn't it, of who your customers are? And if you're the kind of person who can participate in steakhouse level dining, this isn't an issue. It's not. They know it's expensive. They'll probably still come at the same rate. Everybody else, though, it's rationed at best. If we were to say we're out of risk, it then happens very frequently, but we will have all the other proteins. People just turn around and walk out. Mhmm. So even at this level Right. This is what they come for. It's true. With with with all of but with the population sort of shifting around, we're seeing more people from the south move into Central Texas, a lot of people from Georgia, god only knows why, a lot of people from Florida. And and so they're bringing with them a very southern barbecue ideal. They order a lot of pork. They order a ton of pork. And so we're seeing this shift occur, not because of pricing, in my opinion. It's has everything to do with regionality of of where these people originate. They're transplants. It must be like what California was like at one point in the in the sixties and seventies. Right? Nobody was from there. Everybody was a transplant there. Houston went through that in the seventies and eighties. So our menu, it all that does for us really is means we're we're bulking up on more of those white eights. I haven't seen the demand. What I've in in brisket, it hasn't I don't think it's waned at all. I think our traffic has constricted. Speaker 0
And that's what I was gonna say is it may not even be that it's we're seeing complaints about it. It just may be that people just don't come. Traffic may just be down. Speaker 2
We're just we've eliminated people at price point. And and I don't you know, honestly, I think people when this first happened, remember early on in the spring when everybody had to jump up because shit just blew up, and we were told, oh, by summer, by end of summer, by early fall, by end of fall, by winter for sure. You know? And then you find out there's price fixing and shit going on, and you're like, what the fuck, man? Why do we deal with this shit? Because we have no power is why we deal with this shit. We're we're we are complete slaves to the system. Brisket, I don't think changes. I think what we do maybe sell more ribs, offer more rib specials, and try to really increase our side value. Yeah. Because if peep I've gotten to the point. If people wanna argue price point, then I'm like, okay. Well, let's let's at least have a discussion apples to apples. Which which cuisine are you talking about? You talking about Whataburger in and a Whataburger meal? Then let's talk about what that patty weighs. So let's talk about what that patty weighs. Mhmm. Pre precooked weight versus and that's your that is your protein mass for the entire meal. Now let's look at what our protein mass is for that exact same meal. Not not only that, you know what's happening here. You don't know what's in that patty. Mm-mm. Where it's been, how it's been processed. It's Whataburger, but you just don't know. This you do. The cost of labor, which nobody gives a shit about. No. Kills you. So but I don't think brisket changes, man. I, you know, I don't think the the demand for sausage will ever change either. In fact, over time, I see it dwindling. Young younger people are just not sausage eaters. Speaker 1
You know? Speaker 2
If they're from small towns, they will. But if they're urban Speaker 0
Right. Speaker 2
No. They're not really interested. Not interested. Eat it. It's just like, I Speaker 0
I'm super proud of all the sauces we're making now, and you're right. Because I'm like, oh, man. We have this really amazing thing that that we're making now. It doesn't really move. And I think I said this before, but we've done all these all these things to position, especially with our breakfast menu, to create all this value that you can get breakfast for cheap. And then, you know, beneath that are is with brisket on it, and it's Mhmm. Speaker 2
A lot more. And they want the brisket on it. Speaker 0
And that's still what we sell the most of. Mhmm. Speaker 2
Yes. Yes. But you at least you have that price point differentiation. You you you're promoting as the base product, and brisket is the add on. It the expectation isn't for the brisket to be in there. I think that's where people will get upset. Speaker 0
So do you think, yeah, I mean, we we can't strike it. I mean, it's not the kind of thing that you just Right. Speaker 2
Right. Right. You can't Speaker 0
not serve it. So there's a ton of articles out right now. And, I mean, before we talked today, there is there's a group thread with a ton of links to a ton of articles. And at the same time that everyone still wants it, it can't just be that we're we're barely breaking even on it. Speaker 2
What I see now are a more pro barbecue base, clientele. We went through this rocket cycle starting in around twenty ten. As soon as Aaron hit nationwide acceptance and understanding and Texas style central Texas style brisket became a thing nationally, we've been on this huge ascent. We're not on that ascent anymore. And everybody jumped on that bandwagon because everybody wanted to be a part of that. It was such a huge phenomenon. One that last I don't know that we'll ever see an another. It certainly, a never another protein, but maybe another food item that has that kind of power, that kind of just momentum and breadth. Dude, it's impossible. And what was developed after that, there it it enriched we took barbecue from being a special events food to being a daily menu item option for most people. Now, I think it's it's still has that status, but not just your casual consumer is really interested in paying that kind of money anymore. There's I mean, it was great, whatever, but it doesn't ring their bell. The barbecue aficionados, the people who really they grew up on it. This is what they want. I don't think they're going anywhere anytime soon. I just think they come less often. They'll still get what they always got because that's their thing. Right? They just don't come as often. Speaker 0
It's not peasant food anymore. Speaker 2
But we've we've lost all we've lost all of the the the the the tweeners. I think we we're losing them by the buckets. Speaker 1
I think I think that's it. It's it's the people that would have come just because during the week, you know, they they viewed barbecue as an option like they did any any other type of food. Right. And now it's moved into a different category. They still want the same thing when they go, but they're not gonna go just just on a whim. Speaker 2
Yeah. I And the Why would they go someplace and then start feeling like they have to to pull back? Oh, I can only get a quarter pound of brisket, and that's barely enough to do anything for me. You know? It it when a half a pound is what I'm accustomed to. I just it it seems to me they would be they were they would rather be fully satisfied in the experience than just somewhat satisfied. Speaker 0
Mhmm. So it would just come less. Justin, are you seeing a difference in the way people order at Pecan Lodge? Speaker 1
I mean, I I know that we've we've adjusted our menu structure to try to offer more items that are outside of the what you would consider, like, the traditional trinity so that we could try to get to a lower price point on things on the menu. And so far, the uptake on that has been pretty good. So I think it's I think it's resonating with people for sure. Speaker 0
But Let me ask you let Speaker 2
me ask both of you this. At any point in time, do you consider dropping down to select? Speaker 0
I mean, I probably would. Speaker 2
What what what okay. What Just Speaker 0
to chop it. Speaker 2
What would have to occur for you to say, okay. We're moving to Select? Speaker 0
I mean, it'd have to Speaker 1
be a pricing thing. It'd have to just be it'd have to get to the point where it just it wasn't sustainable, like it did with Prime. Speaker 2
What what kind of price point are you looking at? At at Prime and at Choice. If you if let's look at this in a tiered way. Speaker 0
Last time I looked, Select wasn't even actually that drastically different from Choice. Speaker 2
Honestly that is? Speaker 0
I have no idea. It was perplexing. I I we were all sitting at the table in the office, like, this can't be right. There is Speaker 1
a much bigger difference between Prime and Choice for us in November than there is now. You know? It was a twenty, thirty, forty percent difference, and now it's been, like, a ten cent difference. You know? I mean, I Speaker 0
I have a unique situation being an East Texas barbecue joint where chopped brisket is is king here. Right? And I almost feel like if all you're gonna do is take the cleaver to it, how much difference is there really at the end of it? I haven't I haven't cooked a select brisket, and I can't remember how long. But if you're gonna just beat the shit out of it with the cleaver, you know, whether it's prime or choice or select, I just really don't know that anyone's gonna be able to tell the difference. And if it's if it can create a perceived value, then that's something I might I might be like, sure. I would try it first to make sure. I would never just blindly be like, sure. Let's get select. Then I would never keep the price the same where we are now. But for slicing a brisket, for making a great slice brisket sandwich or making a plate, I don't think I don't think we could do it. Like, to me, that just Speaker 2
How does Snows do it? They use Select? Really? Yes. Speaker 0
Well, but they're also, like, three or four pound briskets, which I don't know how they find those Select. They they're called. Okay. Speaker 2
O'Brien's trims and calls them. Speaker 0
I mean, that used to be I think everyone Speaker 2
did it. It it it honestly it honestly depends. It honestly depends. If I I mean, what clientele am I going for, and what community am I in? If I'm in a large enough community, there's enough people with a disposable income that I can still cater to them. Speaker 0
Y'all should have seen the lineup fucking Buc ee's and Terrell on the way here for a Yeah. There was a brisket on the board, y'all. Hot brisket on the board, a line around the whole thing for a damn I don't even know if that's even select brisket. Speaker 1
How many how many how many briskets do you think they got through a day? Speaker 0
Dude, Speaker 2
it was five years ago. Each one of the big stores, the trucks, they had, like, eleven at the time. For the month of October, they were they were selling, like, six hundred and sixty no. Six point six million sandwiches in those eleven stores for one Speaker 1
month. Speaker 2
Yeah. Yeah. Yeah. Yeah. I know. It makes my head swim. The math just it makes me cry. Sure enough. Hey. All because of great bathrooms. Speaker 0
I mean, that's why I stopped. Speaker 2
That's why all the ladies stopped. Speaker 0
I wanna jump back though and see if, Justin, if you can go into a little bit more detail about how you restructured the menu. Will you what'd you do? What does that mean? Speaker 1
So our our our menu used to be very much focused on, like, the traditional barbecue items that you would see. Yeah. You know? It led off with the price by pound, and then it was plates and sandwiches. And then we had a couple of other things like fried chicken and the loaded potato and things along those lines that, I guess, if you're reading the menu, they they were kind of afterthoughts. You know, they were after you'd read through all the other things, there were those as options. And we got to the point where we felt like, you know, one, we needed to be catering to a different market. It just wasn't about the barbecue tourists anymore. But in our particular neighborhood, there have been a lot of residential developments that have come up and we are looking at, you know, how do we tap into the people that are living there that are that are eating in that neighborhood and going out to eat a couple times a week. Speaker 0
Okay. Speaker 1
You know, are they gonna, are they gonna, you know, if we're gonna get their attention and have them come down, they're gonna want something other than a two meat plate every time they come down. You know, there needs to be some other options. There needs to be some things that if we've got a band that's going, they can come down and get something light. It doesn't have to be like a huge meal, but they can get a, they can get a beer and they can get a snack of some kind. And so, you know, we looked at some of the different specials we've done over time and reoriented the menu so that it started off with things that were kind of shareable and appetizers. And then we have a a whole section of sandwiches now where we use a smaller bun, and they're at a different price point. They come with a side versus, like, our standard size sandwiches. Any anything that we could do to try to put some lower lower price points on the board so that everything wasn't, you know, Speaker 0
twenty percent off. The other bigger sandwich. Speaker 1
Yeah. Yeah. We still have that smaller. Speaker 0
Mhmm. Mhmm. So yeah. Which is great. It's instead of just being, like, shrinkflation where you got one sandwich, but the bun is smaller now and this sandwich itself is smaller, but the price is still the same. Yep. That pisses people off big time. Mhmm. I love that that's working. We're we've been talking about similar things. Bringing breakfast back was our first shot at trying to just expand our dayparts to have a little bit wider stance. We're all there anyway, plus the food's good. We're in we benefit from where our location is. Speaker 1
Mhmm. Speaker 0
But I still this is still just a really tough question. I mean, it's not like we can just stop cooking as much brisket. People still wanna buy it, I guess. So if you sell out, people get mad. Uh-huh. It's harder it's hard to cut costs elsewhere because it's still so labor intensive. We can't just cut back on staff or you know? It's just tough. It's scary. It's just hard it's hard to look at this year and just be super duper stoked. Like, I wanna just be like, yay. Twenty twenty six. Let's go. And in the grand scheme of things, no matter no matter what, the beef herd, the the inventory, the cattle inventory is still at the lowest it's ever been and not not growing. So all that that says to me is that this isn't gonna be over anytime soon. This is a this is a long road, and I'm an optimist, and I want to remain optimistic. I don't ever wanna be like, oh, man. Our business is in jeopardy. Like, we gotta do something, but I feel that way sometimes. Mhmm. I wake up at night, and I'm and I I'm freaking out. Speaker 1
Yeah. Hundred percent. Speaker 0
So if the guests just stop coming in, which, you know, kinda seeing that anyway. It's January. It's slow. Wayne, you were saying that guest traffic's way down down there right now. Speaker 2
Mhmm. And it's due to a number of of converging, you know, variables. Speaker 0
Right. It's hard to say. It's not just because your brisket is expensive. Speaker 2
Huddl's turned into, like, a swollen prostate. Right? It restricts all it restricts all flow from the tollway into town. What used to take, you know, ten, fifteen minutes from that spot, now it can take you forty five minutes, and people just don't have the time. Speaker 0
Yeah. And then I felt that last moment. To see you. Yeah. I was like, what is taking so damn? And where am I? Speaker 2
Right. Yeah. Right. So it's a huge determinant, I believe, whether people are gonna travel from that, you know, west end of town, the thirty five, or the toll, if they're gonna come from there or not. Things are tough in Taylor. Even though Samsung a a contractor just came in the other day saying, well, they've Samsung has announced plans. They have one foundry that's now coming online. I think all those chips are going to Tesla. He was saying, you know, the scope of the project was there could be up to nine foundries over a twenty year construction project. That's pretty big. They bought, I think, like, fourteen hundred acres to put this stuff on. Well, this guy is saying, hey, man. It could be nineteen foundries over the next fifty years. That's gonna change the complexion of my town completely. And I don't know that it's necessarily gonna be for the better. At least for the downtown area, I I just it seems like there's gonna be more things happening in the periphery, and the growth is gonna happen in the periphery. It's not gonna happen in the downtown. These kind of conditions, even with, you know, pricing difficulties, I think are are then layered with this waning interest by the casual diner, all creating this this perfect storm. By downtown's getting gutted by taxes. Everybody's taxes have gone through the roof, and now the tenants can't afford to pay. You know, they were going from, paying for my little shop at fifteen hundred a month to now it's five thousand a month triple net, and they're just going, what the hell is all of this? And they can't afford to do that. I I sell I resell stuff. You know? How how can I do this? We have this other whole transformation occurring at Taylor that just wasn't there twenty years ago. None of nothing like that existed. And the growth of of Destination Barbecue was a thing. Speaker 0
Is ranching around Taylor a thing? Speaker 2
Like Yes. Speaker 0
Do people raise cows out there? Speaker 2
Yeah. It's like most farmers have cows. A lot of people have cows. Because there's just a lot there's just a lot of open land, dude, that cows do just fine on. If they could make, you know, five hundred bucks a head or something, it's worth them to them to do it with and keep the ag exemption, you know, holding on the property that was their grandfathers or great grandfathers. Speaker 0
So right after we we put out episode five, I swear I saw a ton of articles in some video, like, investigative pieces about beef prices, which I was like, cool. Right on. Other people are thinking about this. There was a video investigation from an outfit called the More Perfect Union. It's a really, really great piece, and that's from the perspective of talking to the to the cattlemen and how they're really trying to explain the difference between cattle and beef, beef being the what's in the grocery store and what we're getting versus what these guys are raising. And they the guy, he he's a rancher in Nebraska, I think. And he said that basically when the as soon as the president said, hey. We're gonna start importing all this Argentinian beef to try to mellow out what's happening, right, the supply issue. Almost instantly, they lost two to three hundred dollars per calf, which amounted to this one particular guy said he instantly lost, like, two hundred and fifty thousand dollars, which I thought was really I mean, that's crazy. And then he started talking about what what is my incentive to keep doing this? And I think that that must be do you guys think that that's the problem of of, like, why the herd can't replenish right now? Is it that micro? Is it something bigger than that? Or is it just that all these family farms everywhere, which they're, you know, are they're saying they're losing seventeen thousand farms and ranches a year right now. Are they all facing the same thing? Is that why the herd size can't recover? Speaker 2
Well, there has to be a reason that we're we're importing lean cuts of meat. We're exporting all the primals, but we're importing all the lean shit. Mexico, Australia, Argentina. It's all coming in lean. It's all going to burger. What you were saying, there's a difference between beef and cattle. That sounds to me what is the difference? What what was the definition? Speaker 0
I mean, that was just that was just simple simply literal. Just like Well Yeah. Speaker 2
Think of it as Speaker 0
I'm selling cattle. If Speaker 2
you're not invest if you're not investing in in a high end, say, an Angus one of the Angus mini programs. If you can't meet the requirements for that, then you can't sell into that. And there's a premium that comes along with that. So maybe all you're selling is for burger. And if you're getting undercut by all the imports, then there is what is the incentive? If you're not if you're not growing for the upper end, for what we do. Right. Even though the herds are lower, I'm not so certain. And I this is something I would like to talk to a couple of men about. Are the herds are the Angus programs that are out there? And there's at least a hundred plus. Are they suffering, or are they growing? Is is the amount of brisket being produced a year and retained domestically, how is that fluctuating? Because, ultimately, it's not about the carcass weight. It's not about the burger. Not for us. It's about the brisket, and it's about choice or higher or high choice or prime. That's what I'm most interested in. If that is actually growing, because aft after the la the last drought, you saw a tripling of the amount of prime going to market consistently just because, genetically, you were able you kept all of your best your best heifers. Right? And so you had you you just had better offsprings three year late three years later. But if the bulk of what's going out is being made for Burger and they get undercut, it's it's sort of hidden in plain sight. It would explain why they're going out of business, why they don't wanna do it anymore, because they are being undercut. But the people in the Angus programs, they're probably not feeling that. I don't know, but that seems reasonable to me. Speaker 0
And and not that I wanna give any of the big four any benefit of the doubt, but, apparently, their inability to have cows to process means they can't keep the lights on. And, how I guess they're supposed to be losing this insane Speaker 2
amount of money. Chicken egg, if they're if they're gonna undertake in the import, which they are, and they're using that for the burger that they would be getting from the local farmer and decide, I'm not gonna give you what you want for that cow. I'm gonna give you eighty percent, eighty cents on on the dollar for it. You're gonna reduce you're gonna reduce the domestic herd. The demand for it isn't there. They're not gonna raise it to lose money, not even to break even. Just those pressures alone, those simple supply demand pressures would push down the the herd size, especially if that's where the bulk of the of beef goes. Now I don't know those numbers, and these numbers would be very interesting to know because they they would tell us a lot. And this is where I think, is it Lance? Lance Zimmerman, one of the two guys? Yeah. Who is a food analyst for CALFAX forever, he would be able to tell us some of this information. Speaker 0
Right. Speaker 2
You know what I'm saying? Speaker 0
Yeah. There's a few guys that That Speaker 2
would that would be very interesting to know. Speaker 0
Yeah. Because we can definitely Speaker 2
talk to. Because then now the pictures, I think, makes a bit more sense and why the small town farmer, really, who is just sort of looking for the ag exemption and hoping to get just some, you know, commodity price off Speaker 0
off Speaker 2
of his his twenty four, twenty eight month old steer. Right? He's just looking to make a few hundred bucks off the thing. It's not like it's not important to him, but it's probably not his prime source of income either. There are exceptions clearly like this guy you were talking about, how that two, you know, two dollar or two hundred dollar a calf cost him two hundred and fifty thou. That's that's a big ouch. Speaker 0
It's a really great piece. It also talks about the just the beef market and how, like, the paper traders, how they also are a huge contributing factor to to all the crazy price fluctuations. And none of those people actually have cows. They're not No. Buying and selling cows. It's just it's the it's that whole part of the market that just makes my brain hurt because I don't because I don't get it. Speaker 2
It's all it's just it's gambling. It they're betting on price. Yeah. That's all they're doing. And if they if the price is right, you know, if it's above where they bought in, they're gonna do fine. If it's not, they didn't pay that much for it anyway. There's insurance. Think of it as a a hedge, but it's all it's all paper. Speaker 1
You know? It's like the silver mark Speaker 2
it's like the silver market where there's five times as much paper as there is actual metal underwriting it. It's it's it's fractional, which in essence should devalue the product, but it doesn't until it blows up. All derivatives some suddenly come due, especially if margin calls. Speaker 0
And, apparently, the herd crisis is the result of multiyear droughts from twenty twenty two and twenty five and high feed costs that are forcing ranchers to cull instead of breed. Speaker 2
Where are the droughts, though? Speaker 0
Yeah. I don't know. Speaker 2
They're not in the Midwest, and that's what I'm saying. It's not where our cattle are being raised. So where is this? They'll blame it on some condition, but they don't give you any specifics of the condition. Mhmm. Speaker 1
Where it Speaker 2
can be located? How long it's what's its duration? Which is Speaker 0
why we need to talk to the dudes. We've got we've got some guests that have agreed to come on and talk to us. Scheduling's just been a thing. Didn't wanna wait. We wanna jump back in and start start the conversation against even though you can be, like, have this whole giant Google Doc with all this shit in it, it still doesn't really get down to the okay. Well, why? Why? Why? Where's the drought? What drought? Yeah. What you talking about, Willis? Speaker 2
And and right. And and how beef is is grown and distributed and who and utilized. It's not the same. It isn't the same. Just the same as, no offense, Hyundai and Rolls Royce. They're not the same. Functionally, they are. They're not? Shocker. No. But you get my point. Speaker 0
I do. Yeah. That's a great point. Speaker 2
And so if that if that is the case, then what what we are concerned about, and not that everything else isn't concerning, but what affects us immediately is we're we're using what what used to be just ground beef, but now has to it's viewed in a very different way because now it makes money for for Packers in a way that it never did before. Sort of sort of like inside skirt steak when when fajitas became a thing in the seventies. It went from just nothing, chewy, just dog meat. Right? To now it's, you know, four bucks a pound, five bucks a pound, six bucks a pound. Wagyu is, like, sixteen bucks a pound. Speaker 0
Is the screw worm thing going to be another one of I I don't doubt I don't want it to be a problem. I don't want this screw worm to get here because it would be a huge problem, I'm sure. But is this just an gonna be another one of those things? It's like, oh, yep. Screw worms, you guys. Gonna need another buck a pound. Speaker 2
Well, they're first they actually exist. There's there's no doubt about the fact they exist because they're also affecting other livestock, like, you know, deer, etcetera, or also being sort of just taken down. Yeah. I think the bigger question is, are are these prophylactic measures that the government is taking, are they gonna work? Are these are these too late. Are these are these sterile are these sterile flies that they're putting out in the millions a day? Are is that gonna be enough to create a barrier such that they don't get through because they just don't repopulate? Speaker 0
So, allegedly, this happened in the seventies, and they were producing five to six hundred million flies a week to combat the screw worm. Whereas now Yeah. We're at, like, a hundred million flies a week. Yeah. Yeah. Well, I mean, I guess it worked. Speaker 2
Then that's how then that's how In the seventies. Sounds that sounds like a big problem. If it happened in the seventies, shouldn't it be hap I mean, do you think it'll work? I hope so because we don't need another excuse whether it'll be detrimental to us or not. Again, it goes right back to the question of what tell me what the cows are being used for. All the cows in Texas, what are they being used for? Especially the cows in South Texas. Are they ground meat, or are they brisket quality stuff? If it's ground meat, it's probably not gonna affect us as much. However, do you really trust that the packers aren't just gonna unilaterally raise prices of every cut and every piece? Yes. Yeah. That's what's gonna happen. Right? That's how they roll. That's what I expect. So, it's not gonna take much of these things just showing up. You know, it's the killer bees of the seventies. Look how much hysteria you can actually create, What a little media attention can give can do to people. Speaker 0
Well, at least in all of this, I guess, the good news about the voluntary labeling regulation, the sticker about country of origin. Speaker 2
But isn't it good news only only if it changes people's purchase purchasing decisions and habits? Speaker 0
Because someone would have to be looking for that label on the package and making a choice of whether they see it or not with the product of USAID. I think they're just they're just going down the line looking at Speaker 2
Well, the next thing will happen is there there will be a marketing firm that comes out and shows the intricate added value and high quality value of Argentinian beef and how it's so much greater. And then use, you know, all South American type of, restaurants and cuisines to demonstrate this is how it's so awesome, that it's superior. I fully expect propaganda to happen. Speaker 0
If Right. Speaker 2
If people start pushing back pushing back on, they don't want this beef. There's gonna be an ad campaign that comes out and says, oh, yes, you do. It makes your life better. Speaker 0
Because I I think the thought might be that packers have to choose to either stop using that label now because they can't if it's cheap imported or pay the premium for domestic cattle. But I just again, I don't know if I'm trying to think of my own habits when I go to buy. Speaker 2
Still depends on you. Speaker 0
That's not some that's not something I'm looking for, though. Maybe you maybe Speaker 2
you're now that you're aware, you will be. Speaker 0
Sure. And that's that's and I think that's important why it's Yeah. Speaker 1
I mean, to Speaker 0
to talk about it. Speaker 1
It's also one thing to to pick up a steak that's in a package that's already been cut and it has a label on it. It's another thing to be just looking in the butcher case, and you see a bunch of rib eyes in there. Speaker 0
But I almost feel like if I want Speaker 1
to pick Speaker 0
it up and it said product of USA, I'd be like, well, yeah. Is it usually not? Like, I think it I just think that everyone expects that, like, of course, this is a product of the USA. Mhmm. We grow we grow cows. Speaker 2
I guess maybe look at how look at how produce is handled. We used to get all of our produce from from California and Florida to some degree. Mhmm. Now most of that stuff comes from South America. Speaker 0
Would it be better Speaker 2
about that? Are they eating less fruit? No. Because it's it's that's a very that's a very real sort of comparative. Speaker 0
So I'm reading through some of the the background of the USDA food safety and inspection service final rule eight nine f r one nine four seven zero, which says the born, raised, slaughtered, processed standard prior to this rule, meat could be imported from overseas, repackaged in a US plant, and legally labeled product of the USA. As of January first, that label can only be used if the animal was born in the US, raised in the US, slaughtered in the US, processed in the US. But that means that the USDA is now gonna require packers to have substantiation records available within twenty four hours of a request, which is obviously gonna be some administrative bureaucratic BS cost, which they're gonna basically pass down and to mark up that package because they have to now do all this shit to Mhmm. Speaker 2
How many small farmers are gonna wanna have to now keep up with genealogy of their cows Right. And registration of their cows? Registered cows, I I that's a normal thing. But if you're just raising cow, you Bessie's out in the back forty. Speaker 0
Here here's a here's a here's another catch that this label is voluntary. Packer doesn't have to label it. If you start seeing Speaker 2
more saying. Speaker 0
If you start seeing more beef in the market without any label, it's a red flag that it's likely imported blended imported beef that the big four are using to try to save their margins. So if there's no label, it's probably not Mhmm. From the US. Or maybe The Speaker 2
only way you can label is if it is. Speaker 0
Yeah. But you don't have Speaker 2
to label. But you don't have to. It's, you know, it's also another way just to add premium to something that is right. As a base cost now that you have a premium added to that because you've added the label. Speaker 0
Have a hard time believing that they're gonna actually pay the rancher more for that account so that they can No. Put that label on there. Speaker 2
Of course not. The rancher's not gonna get paid more because chances are he doesn't first off, he doesn't have the papers. They're gonna make it Okay. Speaker 0
Well, it's gonna be cost Speaker 2
yeah. It'll be cost restrictive as as well as time consuming. And, you know Totally. Logistically, I I it just you need a fucking you need somebody dedicated just to that shit. Think if you have a a head of a hundred, just a hundred. This stuff gets, you know, and and your heifer all your heifers have a a at least one calf that year. Speaker 0
And I ain't got Speaker 2
time for that. These things get to market, you got, you know, three hundred three hundred fifty calves or cows. Things are getting unruly quick. It just seems like another tax that small farmers and ranchers can't afford and can't deal with that will drive them out. Bureau offers make it Speaker 0
that make any sense. Speaker 2
There's developments going on everywhere, and Texas is growing like wildfire. Speaking of wildfires, have they rebuilt Lahaina yet? Speaker 0
I don't know. Speaker 1
Yeah. In Speaker 2
Maui from the fires. They haven't rebuilt the Palisades yet in California. How old are these fires now? Speaker 0
Several years. Speaker 2
Why is this why is this stuff taking so long? Weren't those people promised there was gonna be building permits within the first six weeks, six months? I I don't know. I've been just asking. Ones Speaker 0
got an agenda. Speaker 2
There's a lot of fires going on in in Argentina right now going on too that are being that are actually you have arsonists who are setting fires, burning people out, acquiring land cheap. What's that about? Speaker 0
Seems shady. More shady shit. Even even though there's a tiny little bit more clarity about what's going on, we still gotta get some of these folks on here to talk. Wayne sent this list of questions via email that will blow your mind. Guy's one of the smartest people I know, and he's gonna ask he's gonna ask the tough questions. And I'm gonna stand behind him and be like, yeah. Speaker 2
Well, but these are the people should know these answers. Right? Speaker 0
I mean No. For real. It's not Speaker 2
This is what they proclaim to do. Speaker 0
And You're not asking about the magic bullet theory. Speaker 2
I'm not. No. I'm not. I'm just asking for clarity on situations that are already in the public domain. It'd be better coming from them. Speaker 0
Absolutely. Because who who the hell are we, and what do we know? Speaker 2
So true. I know nothing, and I know that I know nothing. I can start a fire occasionally. Speaker 0
Bro, you can start a fire like no other. You're you're on my island, dude. Speaker 2
You know Speaker 0
what I'm saying? Kills. If the shit goes down, Wayne I'm I'm taking Wayne. I'm gonna have to use chloroform on a rag and jump on his back like he did to me in Austin that one time Classic. When he bruised my trachea. Justin, you're gonna have to help me hold him down until he passes out, and we can get him on the boat. Speaker 1
He'll take both of us. Speaker 0
But he's he's going on the island. Boy, it can start a fire. Yeah. So now we're gonna get to the part of the podcast where where the segment titled Justin say something smart. And Oh. Yeah. It comes down to the golden question about brisket. Justin, say something smart. Speaker 1
I was waiting for the golden question. Speaker 0
Oh, yeah. What was the golden question? Vic just said it. Speaker 2
And I said, that's it. Speaker 0
And then instantly forgot because I got excited about the Justin, say something smart segment. Folks out there in barbecue land in Texas, Oklahoma, East Coast, West Coast, Canada, apparently, can Canadians really love Texas style barbecue. They're even building pits up there now. They raise really great cows. The question is the golden question for the Justin, say something smart segment. Yes. Are you gonna just keep buying, demanding, showing up, wanting, needing, having to have brisket at your barbecue joints. No matter what happens to the price, are you gonna keep keep coming and getting it? Justin, what will they do? Speaker 1
I think that's a I think that's a good question. I think that's something that we're that we're all trying to figure out right now. You know? I mean, it's you know? I mean, I'd I'd sixty percent of our food cost are wrapped up in brisket, which means it's the, you know, it's the number one thing that goes out the door. But it starts to you know, when they're when pressure is put on that and all of a sudden people aren't buying that, you know, the the big question is are they gonna are they gonna make substitutions, or is it they just stop coming? Speaker 0
Because we're not in Carolina. They're not coming for a pulled pork sandwich. That was real smart, Justin. Good job. Thanks. We're gonna survive. We'll find a way to survive. Speaker 1
Are you guys seeing all the advertisements in your Instagram feed for the Iberico pork from Campo Grande, or is that just me? Speaker 0
That's just you. I deleted Instagram off my phone. Speaker 2
Really? Speaker 0
Yeah. I just had a do that. I had a moment where where I was like, oh, I'm just gonna log on real quick and do this. And I think it was when I was taking the flight home last time, which is about three hour flight. Got onboard the plane, and I was just scrolling a little bit. And then, like, next thing I know, we're landing, and I Speaker 2
was like, oh my god. Yeah. I Speaker 0
just I just went head first into the Instagram time vampire time suck the entire flight and, like, no clue. Like, literally, I was in shock. We landed. I was like, oh my god. Speaker 1
So I mean, the bad thing is watching the algorithm change literally as you're using the app, and all of a sudden, you're you're down some rabbit hole that you never intended on going down. Speaker 0
Yeah. That's an interesting one, dude. That's a very, very specific one, Justin. Wayne, what's on your Instagram feed? Speaker 2
I haven't logged in to Instagram in years. I don't know. I you know, the I think some of the last stuff I posted is when I when I was in when I was in Sao Paulo, Brazil for Churascara. And when was that? Eighteen or something like that? Eighteen, nineteen, maybe? So it's been five it's been a minute, but I swore off most all social media. Speaker 0
Most people that follow you I guess, all people that follow you on social media don't even know you have a podcast. Speaker 2
It's one hundred percent. One hundred percent. Speaker 0
I know that you have a podcast. Speaker 2
Well, stuff that you send me, I I post. Speaker 0
I know. Speaker 2
It's up there. So It's Speaker 0
been great. Speaker 2
That's probably the only post that have been up there for years. Speaker 0
It's so cool. Didn't want to. I made you do it. I appreciate it. Thank you. Thank you very much. I demand that we do this more often. Speaker 2
It's great to see you. Speaker 0
The millions of listeners demand that we do this more often. We must get together just to see your silly faces, to hear the smart things that Justin says, Wayne's handsome hat collection, and the cat. I'm surprised we have not seen the cat today. I miss pumpkin. Speaker 2
Yeah. Yeah. Yeah. I held him out today. Speaker 0
The million dollar question is or maybe it's more than a million dollar question is, you guys know anyone that wants to buy a barbecue joint or three barbecue joints? Hit us up at hello at smokeless podcast dot com. Hey, guys. If you've enjoyed this episode or any of the episodes, and even the future episodes that you already can't get enough of, be sure. Share it with your friends. Let them know. You can find us on YouTube and Spotify and Apple Podcasts and where all of the things with the stuff are. We'd appreciate a a share. If you really love it, maybe give us a review. And, also, let us know. Reach out. Hit us up in that comment. Send us an email. Can you go to your local barbecue joint and not have brisket? Can you do it, Or do you refuse? I will not not have brisket. Let us know. And also if you cannot not have brisket, please go out to a barbecue joint today and order five or ten pounds of brisket. Buy gift cards. Give gift cards out to your friends. Buy a slice today. Buy another slice tomorrow. Buy some brisket. For the love of God, buy some sausage, people. You need more sausage in your life. Did you guys see the size of the sausage that the dude is making at Tejas chocolate? It was at least three inches. It was it was impressive. If you don't know what I'm talking about, go find the episode from us at Troubadour and look at the size of this beautiful sausage, and get more sausage in your life. Eat more sausage, eat more brisket, go see Wayne, go see Justin, come see me, go to support your local barbecue joint wherever you are out there. Thanks for your support. Thanks for listening to Smokeless. We'll see you guys next time. On the next episode of the Smokeless podcast, Bill Bullard from RCAF. Speaker 3
As these imports have satisfied domestic consumption of beef and demand, they have eliminated opportunities for our domestic industry to rebuild the herd, and this is a national security issue. Speaker 1
If prices are at a historical high, why are we not rebuilding the herd? Why are they not incentivized to do that? And then two, if we're importing this beef at a a much lower cost, why aren't why isn't that lower cost being passed on to the consumers? Because we're hearing that the cattle ranchers are suffering, we're hearing that the big four packers are suffering major losses and closing down production facilities. Something doesn't quite add up because we've got all these high prices and every point in the cycle people are saying that they're suffering in the supply chain. 
