ND Natural Beef sends out final payments to producers
DAZEY, N.D. — Five farmers who once were owed a total of more than $325,000 from North Dakota Natural Beef LLC recently have been paid in full after nearly a seven-year wait.
Lloyd and Audrey Wieland of Dazey, who talked with Agweek in March 2012 about their troubles being paid by the company. When they were given their final payment of $1,594.20 a few weeks ago, they were happy to acknowledge it.
"I felt I owed them that," Lloyd says.
The North American Bison LLC, of New Rockford, N.D., owned 51 percent of the beef company and had the same management. It was one of several prominent players in the enterprise, including the North Dakota Farmers Union.
The Wielands delivered three groups of cattle to North Dakota Natural Beef LLC, at its New Rockford slaughter plant in the fall of 2010. The beef company had a Fargo processing plant, which included space for North Dakota State University meat science classes.
"We were pretty unsure that we'd ever see our money, except for the bond and the initial payment when they sold meat they had on hand," Wieland says. "We're really happy to be paid in full."
A 'natural' move
In 2006, Wielands were in the cattle business turned to the "natural" beef market, which requires no hormones or medications and sometimes pays a premium compared to conventionally-raised beef. In 2009 and 2010, they sold to the North Dakota Natural Beef.
The Wielands raised steers to 1,000 pounds. They took them to Pipestem Feeders of Carrington to take them to the 1,450-pound finish weight before shipping to New Rockford. After being paid for one group, they had trouble on the second and third groups and eventually were owed $68,000.
The Wielands — long-time North Dakota Farmers Union members — had been confident in the new beef business in part because the NDFU had invested $750,000 in it. Woody Barth, the NDFU vice president and later president, was on the NDNB board of directors.
NDSU, Wieland's alma mater, was a big promoter. Dakota Growers Pasta Co., headed by then Lt. Gov. Jack Dalrymple, was an investor.
The federal Grain Inspection, Packers and Stockyards Administration at the time stepped in when the company started failing to pay.
Bruce A. Gardner, then GIPSA financial unit supervisor in the agency's Des Moines, Iowa, office, sent a letter that North Dakota Natural Beef was being audited. Lloyd Wieland attended a GIPSA meeting on Oct. 27, 2010, in Fargo.
In March 2011, the Wielands got their first "trust" check for about $12,000. In May, they got another for $8,000. Separately, the North Dakota Agriculture Department distributed a $30,000 bond, which included $3,742 to the Wielands, paid Jan. 23, 2012.
"As far as we know, everyone got paid," said Greg Andrews, Midwestern regional legal counsel for the recently reorganized Packers and Stockyards Division for the Agricultural Marketing Service in the U.S. Department of Agriculture.
"It was not as quickly as we had hoped," Andrews said. "We brought a complaint against them in administrative hearing. We got an order from an administrative law judge on March 22, 2012. We assessed a civil penalty of $140,000, of which $125,000 was held in abeyance, providing they made payments occur according to terms of an understanding we had with them."
The payments were supposed to be monthly, but sometimes skipped months.
"We thought it was better to let them keep paying as they would, and they did," Andrews says. The last payment was made Sept. 21.
Tim Riemann, president and chief executive officer of North American Bison, said his company is glad they were able to make producers "whole" and "appreciated their support they provided to the Dakota Beef Company during its existence."