New Plan for Meat and Poultry Supply Chain
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On January 3, 2022, President Biden announced his plan to create a fairer, more competitive, and more resilient meat and poultry supply chain. How will this plan impact integrators and farmers in the midwest?
The Plan is intended to address concerns with consolidation in the meat and poultry processing industry. The goal is to create increased profits for farmers and reduced costs for consumers. The Plan proposes to do this through four core strategies.
The federal government will dedicate $1 billion in funds from the American Rescue Plan to help expand independent processing facilities and support workforce development. These dollars will be used to fund grants and loans to help create and grow independent processors throughout the country. The money will also go toward strengthening the supply chain for meat and poultry processing, including cold storage, transportation, and other specialized equipment. These investments should create additional rural jobs, give farmers and consumers more options, and stabilize the industry in the face of increasing challenges from COVID, natural disasters, and labor issues. The USDA will dedicate $100 million to support development of a well-trained workforce and good-paying quality jobs at processors and all along the meat supply chain. Labor shortages have caused havoc in the meat and poultry world for the past two years, so this is welcome news.
The Administration announced it will strengthen the federal laws and rules protecting farmers, ranchers, and consumers. The USDA will propose new rules under the Packers and Stockyards Act. The USDA is reviewing existing rules and will propose new labeling rules designed to clarify the “Product of the USA” labeling for meat.
The Biden-Harris Administration is prioritizing vigorous enforcement of the anti-competition laws currently on the books. This will include, within 30 days, an online portal for producers to submit concerns about potentially unfair or anti-competitive practices in the agricultural sector. The Department of Justice and the USDA released a joint statement of underlying principles and commitments to support enforcement of existing laws and advise Congress on potential legislation to help further protect against unfair practices in the meat and poultry processing industry.
The Administration will increase transparency in cattle markets. The USDA will use its existing authority to increase transparency to the extent it can under current laws. The Administration will also work with Congress to make cattle markets fairer and more transparent.
The Plan was announced formally on January 3, but pieces have been put into place over the past few months, as the Administration explained in September and again in December. American Farm Bureau supports the Plan and indicated it appreciates the Administration’s attempt to get to the bottom of why farmers and ranchers continue to receive low payments while families across America endure rising meat prices.
Individuals or companies who want to break into or expand their processing capabilities should find out whether they qualify for the new federal loans and grants. Farmers and ranchers should see increased processing choices and eventually a larger qualified workforce, but it will take time before these changes are noticed at the local level.
