MARKET ANALYSIS

USDA OFFERS GRANTS, LOANS TO EXPAND MEAT PROCESSING CAPACITY

The US Department of Agriculture will direct $73 million in grants to small- and medium-sized meat and poultry processors to expand their capacity and deliver more funds through lending programs, reported citing Secretary Tom Vilsack. The money aims to increase competition and stability in the meat industry – which is dominated by a few players – as part of a broader effort by the Biden administration to boost competition in the US economy and rein in soaring inflation. The COVID-19 pandemic revealed cracks in the industry as outbreaks temporarily shut massive slaughterhouses early in 2020, pushing up meat prices. Some farmers had to cull livestock that could not be processed due to the closures. The grants for 21 projects are part of $150 million the USDA set aside for the first phase of an attempt to expand processing capacity, Vilsack said. The agency said it will soon begin taking applications for a new phase to deploy an additional $225 million.

The program aims to increase capacity in beef plants by over 500,000 head a year and in poultry plants by over 34 million birds a year, Vilsack said. He expects that projects will create more than 11,000 jobs, not including construction jobs.