Small meatpackers play a critical role in maintaining the U.S. food supply, as well as provide important markets for livestock producers and increase consumer access and options for locally sourced food. However, even as the COVID-19 pandemic threatened to disrupt the nation’s meat supply by causing large meatpacking facilities to pause or slow operations, U.S. Department of Agriculture Food Safety and Inspection Service overtime inspection fees discouraged small meatpackers from processing livestock more than 40 hours per week.
Secretary of Agriculture Tom Vilsack recently spoke about whether there is sufficient competition and resiliency in the livestock processing sector. He recalled how at the start of the pandemic when one or two plants were shut down in Iowa due to workers being exposed or contracting COVID-19, farmers found themselves having hogs that were too large to be processed.
He says at USDA he plans to evaluate whether there are methods, support, assistance or some mechanism that encourages more processing facilities, more regionally located to create greater resiliency and smaller greenhouse gas footprint of food that’s being processed.
“If food doesn’t have to travel thousands of miles, if you shorten the supply chain, you create greater resiliency and you create more competition,” Vilsack says.
“The goal here at the end of the day is to make sure that our farmers are getting a fair shake in the market,” Vilsack says. “And if they’re not, taking steps to make sure they do.”
Support for small meatpackers urged
U.S. Senators Jerry Moran, R-Kan., and Michael Bennet, D-Colo., and U.S. Representatives Dusty Johnson, R-S.D., and Angie Craig, D-Minn., urged Vilsack to prioritize reducing USDA-FSIS overtime fees for very small and small meatpackers based off the provisions included in their legislation, Small Packer Overtime and Holiday Fee Relief for COVID-19 Act as funding was secured in the latest COVID-19 relief legislation.
A USDA spokesman notes, “USDA will ensure to implement these provisions in a timely manner.” The spokesman adds the American Rescue Plan provides significant resources to respond to disruptions in the food supply chain caused by the COVID-19 pandemic.
“Some of those are long-term investments to increase the resiliency of the food supply in the future, and some are short-term to provide immediate help and assistance,” including funds to reduce overtime inspection fees paid by small meat and poultry processors.
The spokesman notes that some of the legislators who signed this letter voted for that support and some did not. “However, the stand-alone legislation is a good reminder that our small meat processors need support, and the ARP provides good coverage.”
The Small Packer Overtime and Holiday Fee Relief COVID-19 Act was first introduced in May 2020 when many farmers were faced with fewer facilities to process their animals.
“Our legislation directs USDA-FSIS to reduce the fees charged to very small establishments by at least 75% and to small establishments by at least 30%,” wrote the senators and representatives. “These changes will help build greater resilience in the nation’s food supply chain by addressing the economic disincentive currently in place for small meatpackers to work longer hours.”
Meatpacking plants with fewer than 10 employees would be required to pay 25% of overtime and holiday fees and FSIS would pay the remaining 75%. Plants with 10-500 employees would be required to pay 70% of overtime fees with FSIS paying the remaining 30%.
The legislators write, “Further, it will help level the playing field between very small and small establishments versus large establishments capable of operating two full operating shifts and therefore able to avoid these inspection fees. Consumers will also benefit from greater access and more options for locally sourced meat products provided by small meatpackers.”
They add the increased slaughter and meat processing capacity resulting from implementing the provisions of their legislation will give livestock producers more options to market their animals.
“By quickly implementing the provisions in our legislation, you can provide immediate relief to these facilities working to keep food on American’s tables,” they write.