USDA Announces Investments to Expand Meat Processing Capacity and Increase Competition
These announcements support the Biden-Harris Administration’s Action Plan for a Fairer, More Competitive, and More Resilient Meat and Poultry Supply Chain, which dedicates resources to expand independent processing capacity. As President Biden highlighted earlier this year, creating fairer markets and more opportunities for family farmers helps bring down prices at the grocery store.
“Since President Biden laid out a commitment at the start of this year, USDA has worked tirelessly to give farmers and ranchers a fair chance to compete in the marketplace, which in turn helps lower food costs for the American people,” said Secretary of Agriculture Tom Vilsack. “By jumpstarting independent processing projects and increasing processing capacity, these investments create more opportunities for farmers and ranchers to get a fair price, while strengthening supply chains, delivering more food produced closer to home for families, expanding economic opportunity, and creating jobs in rural America.”
USDA is delivering on the multi-pronged goals of these investments:
Supporting producer-focused business models: Montana Premium Processing Cooperative (MPPC), a start-up cooperative, created in partnership with the Montana Farmers Union and Farmers Union Industries, will use MPPEP funds to provide independent producers in Montana with an option for a local USDA inspected meat processing facility in an area that is currently without Federally inspected processing.
Strengthening Local and Regional Food Systems: Vermont Livestock Slaughter & Processing connects hundreds of farmers in Vermont and the Northeast with the individuals, families, schools, and businesses they supply. With their MPPEP investment, they are now prepared to revitalize and modernize their multi-species facility, tripling their throughput.
Reducing barriers to processing: Cutting Edge Meat Company, a facility in Leakesville, Mississippi, provides pork and beef processing for producers in Mississippi, Alabama, Louisiana, and Florida. With this investment, they will significantly increase their capacity and shorten the six-month backlog for processing currently facing producers.
Competing at scale: Greater Omaha Packing in Omaha, Nebraska, will open new opportunities for cattle producers by expanding their beef processing capacity by 700 head per day. The project will also support an additional 275 jobs.
Restoring jobs in rural places: Pure Prairie, recently purchased a shuttered poultry plant in Charles City, Iowa, with the goal of returning hundreds of jobs to the small rural community and increasing poultry processing in the upper Midwest. The project sources directly from growers in Minnesota, Wisconsin, and Iowa, who are also shareholders and part owners in the company.
Empowering family-owned businesses: New Stockton Poultry in Stockton, California, is a family-owned business that sources and processes specialty chickens to meet demand within a variety of immigrant communities and beyond.
The investments announced today are part of a series of financial assistance tools to support producers and lenders in increasing capacity in the food supply chain.
MPPEP was designed to support capacity expansion projects in concert with other private and public finance tools. Today’s announcement is the first round of funding made available through Phase I of MPEPP. Additional announcements are expected in the coming weeks. USDA will also soon begin taking applications for a new phase to deploy an additional $225 million, for a total of up to $375 million, to provide gap financing for independent processing plant projects that fill a demonstrated need for more diversified processing capacity. For more information about MPPEP, view the Meat and Poultry Processing Expansion Program page.
The Meat and Poultry Intermediary Lending Program (MPILP) provides grant funding to nonprofit intermediary lenders who finance – or plan to finance – the start-up, expansion, or operation of slaughter, or other processing of meat and poultry. The objective of the MPILP is to strengthen the financing system for independent meat processors, and to create a more resilient, diverse, and secure U.S. food supply chain. In the first round of MPILP $75 million was awarded to eight lenders in seven states. Applications for second cycle ($125 million) are currently being accepted and are due December 31, 2022.
Through the Food Supply Chain Guaranteed Loan program (FSCGLP), USDA partners with lenders to guarantee loans to help eligible entities expand meat and poultry processing capacity and strengthen the U.S. food supply chain. Lenders provide the loans to eligible cooperatives, corporations, for profits, nonprofits, Tribal communities, public bodies and people in rural and urban areas. Since the FSCGLP was launched in December 2021, more than $250 million in loans have been guaranteed for projects in the middle of the food supply chain. Four of these, announced today and totaling more than $75 million, are for meat and poultry processing businesses.
For a full list of awards under these programs, visit: www.rd.usda.gov/sites/default/files/11-02-2022-Food-Systems-Transformation-Chart-OSEC.pdf (PDF, 211 KB)
Today’s announcement is one of many actions that USDA is taking to expand processing capacity and increase competition in meat and poultry processing to make agricultural markets more accessible, fair, competitive, and resilient, and builds upon the Department’s efforts to transform the nation’s food system. Additional information on all these programs is available at www.usda.gov/meat.
USDA touches the lives of all Americans each day in so many positive ways. Under the Biden-Harris Administration, USDA is transforming America’s food system with a greater focus on more resilient local and regional food production, promoting competition and fairer markets for all producers, ensuring access to safe, healthy and nutritious food in all communities, building new markets and streams of income for farmers and producers using climate-smart food and forestry practices, making historic investments in infrastructure and clean energy capabilities in rural America, and committing to equity across the Department by removing systemic barriers and building a workforce more representative of America. To learn more, visit www.usda.gov.