USDA announces major investment in meat and poultry processing

USDA announced it is awarding $35 million in grant funding to boost U.S. meat and poultry processing operations. The grants will support 15 processors in 12 states. Agriculture Secretary Tom Vilsack says those projects will help farmers and ranchers better compete in the marketplace, increasing local food options and lowering grocery costs.

“Since day one, the Biden-Harris administration and USDA have been committed to advancing a sustainable vision of agriculture that prioritizes the needs of hardworking producers and small businesses while keeping rural communities strong, lowering costs for working families as well,” Vilsack says. “The key to this effort is ongoing work at USDA to expand competition in the food and agriculture sector, and accordingly, bolster independent meat processing capacity, providing better markets for our producers.”

According to Vilsack, the pandemic exposed bottlenecks in the food and agriculture supply chain threatening consumers with higher costs and reducing access to key products. He says it also created challenges for producers due to collapsed markets and “unfair” prices.

Meanwhile, according to Vilsack, concentrated markets have been a longstanding concern in key sectors such as meat and poultry. These factors prompted President Biden to issue an executive order to improve competition in the food and agriculture market.

Since then, USDA has invested billions of dollars in programs intended to incentivize food processing competition. This latest round of grants are the final ones to be funded through the Meat and Poultry Processing Expansion Program . That program was launched in 2022 and funded through the American Rescue Plan.

Meat and Poultry Processing Expansion Program’s market impact

USDA has allocated $325 million to 74 projects through the MPPEP. According to department data, those projects have increased annual U.S. processing capacity by more than 800,000 cattle,14,000 hogs, 23 million chickens and 5 million turkeys. With many projects still in development, those numbers are expected to increase further.

Carl Cushing of Vermont Livestock Slaughter and Processing Company is one of those who received a grant. He runs a small operation with only 12 employees. As his customer base grew, he needed to expand his facility. However, he couldn’t afford to stop his operation a full year while the facility was rebuilt. With the help of a grant, he was able to keep operations running as the facility was expanded.

“We had made promises to process these animals for farmers, and we couldn’t break that promise because it takes two years to bring them to market,” Cushing says. “If we had stopped for a year to get the facility rebuilt, we would have made it difficult for our consumers, the farmers. This grant certainly was instrumental, helping us to move along and get things done so that we’re about ready to make a fairly decent growth here.”

Cushing says the new facility will allow his operation to double its output. New equipment will also allow his customers to enter more competitive markets since his company can now offer better packaging and labeling.