990541 Gov't to Help Ailing Bison Industry

Washington - Nearly extinct a century ago, the buffalo is back -- and taxpayers are paying for it.

Buffalo ranching is growing so fast there is not a market for all the meat. As a result, the federal government is stepping in to shore up the industry: The Agriculture Department recently announced it will buy $6 million in surplus ground bison this year, one-quarter of the industry's ground-meat production.

The biggest beneficiary of the purchases likely would be billionaire Ted Turner, the industry's largest producer and its most prominent proponent.

“People who got into buffalo are basically the rich who got into it for a novelty,” complains Randy Mosser, a North Dakota cattle rancher. “Why do they need a bailout?”

The bison industry is a victim of its own success.

At the turn of the century there were fewer than 1,500. Now there are an estimated 250,000 nationwide, and the number is growing as much as 20% a year, according to industry insiders.

Ranchers are so eager to increase their herds that virtually every female calf is kept for breeding; only males are slaughtered.

Turner, vice chairman of Time Warner Inc. [NYSE:TWX - news], raises 17,000 bison on ranches totaling 1.4 million acres in Montana, Nebraska and New Mexico. He is buying 50,000 more acres, in South Dakota.

Bison steaks, roasts and similar cuts are popular in Europe and also sell well in restaurants and steakhouses in parts of this country. But the ground meat, which is too expensive and too lean, and therefore dry when cooked, for some consumers' tastes, has been stacking up in processors' warehouses. More than a third of a typical bison winds up as ground meat.

So the two major bison packers -- the North American Bison Cooperative, of which Turner is a member, and the Denver Buffalo Co. -- asked USDA to buy the surplus meat.

USDA bought $2.5 million worth of ground bison last year, and agreed in March to make the additional $6 million in purchases. The government is paying $3.45 a pound for the bison, more than twice what it pays for ground beef. The bison meat is being given to federal nutrition programs for Indians and migrant workers.

“We made it very clear to the industry that they need to take some responsibility in adjusting their production to meet the market forces in the market place. We are not going to be buying bison indefinitely,” said Enrique Figueroa, administrator of USDA's Agricultural Marketing Service.

The bison buyout will be only a fraction of the government's food purchases this year. USDA spends nearly $290 million a year just for meat for various nutrition programs, including school lunches.

But at Turner's urging, members of the bison cooperative agreed last month to increase its marketing budget from less than $20,000 a year to $2.5 million. The cooperative processes 65% of the nation's bison.

“We think that there is a market for the meat. ... but the industry has concentrated more on production than marketing,” said Russ Miller, who manages Turner's ranches.

Turner aside, industry officials say it is unfair to portray bison ranchers as a wealthy lot.

Many Indian tribes are raising bison, and struggling farmers and cattle ranchers were drawn to the business by the relatively high prices they could get for bison meat. The buffalo is naturally suited to the harsh northern Plains climate.

Dennis Sexhus, whose grandfather homesteaded in North Dakota a century ago, planted his wheat farm to grass in 1994 and now raises 100 bison.

“It's a great use of the land,” he said.

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