The Atlanta Journal-Constitution
Effort to prevent another meat shortage hits a snag
Smaller slaughterhouses cope with not enough money coming in.
Sudden meat shortages last year because of the coronavirus led to millions of dollars in federal grants to help small meat processors expand, so that the nation could lessen its reliance on giant slaughterhouses to supply grocery stores and restaurants.
Like shortages of protective clothing for health care workers, hospital equipment and even toilet paper, the reality of empty meat counters was a shock to many Americans. But where most supply gaps are being addressed by changing how the U. S. acquires key items, the money flowing to small slaughterhouses shows no sign of solving the meat problem.
The meat industry has been consolidating for decades, and 80% or more of meat is slaughtered by just a few companies, whose operations were crippled last year as the virus spread among workers.
“Even a significant increase in processing capacity in those small and midsize processors, that’s a small amount in the grand scheme of things,” Iowa Agriculture Secretary Mike Naig said. “It’s not at the level that will rival the big processors.”
Or as Terry Houser, a meat processing expert at Iowa State University, put it, “Small plants cannot replace the big plants when they go down.”
The number of smaller operations that meet local demand plunged 42% to 1,910 between 1990 and 2016, according to the U. S. Department of Agriculture.
Iowa was among at least 16 states that used some of the billions of dollars in federal COVID- 19 aid to provide grants to small processors, enabling them to replace equipment and expand. Iowa awarded $ 4 million to help 109 small meat and poultry plants increase pro
duction, with some of the funding also going toward marketing and education.
Likewise, Arkansas awarded $ 5 million in federally funded grants, Indiana divvied up $ 4 million and Montana used $ 2 million to fund grants of up to $ 150,000.
Most of the money went to small- town businesses, which have withered as larger plants opened and process thousands of cattle daily, and up to 20,000 hogs. Small processors typically slaughter only 10- 20 animals a week.
When larger plants began closing last spring, hog farmers ended up killing and burying thousands of animals.
The key to lessening dependence on the big processors is to make larger grants and loans available to mid- sized processors, said Rebecca Thistlethwaite, a rancher and director of the Oregon- based Niche Meat Processor Assistance Network. That’s an expensive proposition, with such plants costing $ 20 million or so.
Even i f the government offers more money, expansion in an industry with low profit margins could be slow, she said.
“A lot of people think that by changing policy, all of a sudden a bunch of new entrepreneurs are going to come into the space, and that’s not going to happen,” she said. “You don’t have a bunch of people sitting on a bunch of money who are saying, ‘ Oh, I just can’t wait to start a meat processing plant.’”