USDA on July 9 announced it intends to invest $500 million to expand meat and poultry processing capacity across the country. The National Chicken Council filed comments on the announcement.
“The COVID-19 pandemic led to massive disruption for growers, food workers, and consumers alike,” Agriculture Secretary Tom Vilsack said. “It exposed a food system that was rigid, consolidated, and fragile. Meanwhile, those growing, processing and preparing our food are earning less each year in a system that rewards size over all else. To shift the balance of power back to the people, USDA will invest in building more, better, and fairer markets for producers and consumers alike.”
The American Rescue Plan, a $1.9 trillion bill passed earlier this year, set aside funding for USDA to invest in meat and poultry processing capacity. USDA announced its investment formally in July, but the comment period closed on August 30.
“The chicken industry has developed into a highly efficient sector that combines the benefits of localized agriculture with modern production efficiency, resulting in lower prices and an abundant supply of chicken for consumers and a globally competitive export sector of American agriculture,” NCC’s comments said. “Understanding the factors that make the industry competitive is important for identifying the most appropriate opportunities for investment.
“The challenges presented by the COVID-19 pandemic have shown that the chicken industry is highly resilient, in large part because of its structure,” the comments continued. “The entire country faced tremendous challenges during the pandemic, and the chicken industry was no different. But throughout, grower contracts were honored, safety measures were implemented, and chicken was kept on grocery store shelves. In fact, the most significant hurdles the chicken industry faced were extrinsic.
“The biggest obstacle turned out to be regulatory requirements, in particular specific labeling requirements that made it all but impossible to simply redirect foodservice product to retail. Limited cold-storage capacity made it difficult to store this product longer, and a nationwide shortage in qualified commercial truck drivers impeded redistributing products. These issues came on top of existing challenges in accessing skilled labor (exacerbated by the pandemic’s effects) coupled with challenges such as securing needed personal protective equipment and concerns over the continuity of USDA inspection in the early months of the pandemic.”
The comments went on to provide recommendations that USDA devote a significant proportion of the contemplated resources toward expanding the available cold-storage capacity and the nation’s long-haul trucking fleet (including qualified drivers) in order to remove bottlenecks and chokepoints in the agricultural sector. Finally, any government investment program should be targeted toward enhancing existing rural support programs, including access to credit for small and growing businesses through the USDA’s Farm Service Agency loans and the Small Business Administration loans.
NCC’s full comments can be found here.
