US Provides Grants and Loans to Build Meat Processing Capacity – Agweek
CHICAGO, Nov 2 (Reuters) – The U.S. Department of Agriculture will award $73 million in grants to small and medium-sized meat and poultry processors to boost capacity and provide more funding through the through loan programs, Secretary Tom Vilsack said Wednesday, November 2. 2.
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 curb the surge in inflation.
The COVID-19 pandemic exposed cracks in the industry as outbreaks temporarily shut down huge slaughterhouses in early 2020, driving up meat prices. Some farmers had to cull cattle that could not be processed due to the closures.
The grants for 21 projects are part of $150 million the USDA has set aside for the first phase of an attempt to expand processing capacity, Vilsack said. The agency said it will soon begin accepting applications for a new rollout phase of an additional $225 million.
The program aims to increase the capacity of beef and pork plants by more than 500,000 head a year and poultry plants by more than 34 million birds a year, Vilsack said. He expects the projects to create more than 11,000 jobs, not including construction jobs.
Meat processors have struggled to attract factory workers due to the tight labor market and employee concerns about safety. Companies seeking USDA grants had to demonstrate they could attract workers, Vilsack said.
The USDA is also providing $75 million in loan guarantees to four meat and poultry projects and $75 million to nonprofit programs that can provide low-interest financing to the sector, Vilsack said. .
Here’s where the money is going in the Upper Midwest:
- $46 million in two grants to help Pure Prairie Farms start a chicken processing plant in Charles City
- $15 Million to Council of Region 12 Governments in West Central Iowa to Increase Meat Processors and Diverse Ownership
- $8.87 million for Upper Iowa Beef, an independent beef harvesting and processing facility in Lime Springs that opened in 2017; the goal is to increase our capacity by more than 50%.
- $542,425 for Cherokee Locker Investment to upgrade facility.
- $15 million for the Minnesota Meat and Poultry Revolving Loan Program, operated by the Minnesota Rural Finance Authority.
- $2 million to the Great Falls Development Authority to help fund existing and start-up meat and poultry processing operations.
- $291,900 Montana Premium Processing Cooperative, a partnership with the Montana Farmers Union and Farmers Union Industries, to start a USDA-inspected meat processing plant in an underserved area.
- $20 million for Greater Omaha Packing, a third-generation private company located in Omaha, Nebraska, which buys cattle primarily from independent producers in Iowa and Nebraska. The plan is to go from 2,400 cattle per day to 3,100 head per day.
- $688,011 for Lot 279, a business that has been selling beef products directly to retail since 2016. Lot 279 intends to construct a federally inspected portion cutting and further processing facility for use of at least three family livestock producers seeking to create their own brands of beef products.
- $10 million for the Lewis and Clark Regional Development Council for loans to help start up, expand and operate meat processing facilities.
- $471,525 for South 40 Beef, a USDA-inspected beef processing plant in Mott. Grant funds will be used to expand the cooler and workspace; more than doubling the amount of cattle processed per month and a 50% increase in labor.
- $8.125 million for GROW South Dakota to assist approximately 16 meat and/or poultry processors with an average loan of $500,000 per business.
- $2.375 million for District III, a 15-country region in southeastern South Dakota, to add lending capacity to help processors improve market access, be more efficient, and retain their employees
- $2.21 million for North Prairie Butchery, a small mixed beef and pork plant project with the capacity to process more than 100 animals per week. The current operation is a ranch near Faulkton. The plant is expected to be fully operational by the end of 2023
(Reporting by Tom Polansek, editing by Deepa Babington; Agweek staff contributed to this report)
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