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Biden-Harris administration’s Action Plan for more competitive meat and poultry supply chain

Christian Fernsby |
The Biden-Harris administration’s Action Plan for a fairer, more competitive, and more resilient meat and poultry supply chain includes four core strategies for creating a more competitive, fair, resilient meat and poultry sector, with better earnings for producers and more choices and affordable prices for consumers.

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The Biden-Harris Administration will dedicate $1 billion in American Rescue Plan funds for expansion of independent processing capacity.

USDA identified an urgent need to:

Expand and diversify meat and poultry processing capacity;

Increase producer income;

Provide producers an opportunity to have ownership in processing facilities;

Create stable, well-paying jobs in rural regions;

Raise the bar on worker health, safety, training, and wages for meatpacking

obs; Spur collaboration among producers and workers;

Prompt state, tribal, and private co-investment;

nd Provide consumers with more choices.

To these ends, USDA has increased available funding and is releasing new program details to support the meat and poultry supply chain. Specifically, the Biden-Harris Administration will:

Increase competition and create more options for producers and consumers in the near-term by jump-starting independent processing projects that will increase competition and enhance the resiliency of the food supply chain.

USDA will provide gap financing grants totaling up to $375 million for independent processing plant projects that fill a demonstrated need for more diversified processing capacity.

USDA will publish a Request for Proposals for Phase I of this initiative this Spring. Phase I will invest approximately $150 million to jump-start an estimated 15 projects, focused on deploying financial support for projects with the greatest near-term impact.

USDA will deploy an additional $225 million to support additional projects in Phase II, which will open in Summer 2022. USDA will also ensure these funds truly expand capacity outside the largest meat and poultry processors, funding only independent operations.

USDA will work with lenders to make more capital available to independent processors that need credit. To address the credit access gap, USDA will deploy up to $275 million in partnership with lenders that will, in turn, provide loans and other support to businesses at rates and on terms that increase access to long-term, affordable capital.

USDA will solicit applications from potential partners by Summer 2022, with an initial focus on lenders that provide financing in underserved communities.

From cold storage to specialized equipment, building a more distributed and resilient food system requires independent producers to have access to food processing and distribution infrastructure that enables them to move their product throughout the supply chain.

To assist in the financing of this infrastructure, USDA has deployed $100 million in American Rescue Plan funds, to make more than $1 billion in guaranteed loans available immediately.

Applications for these guaranteed loans will be accepted until funds are expended.

USDA will dedicate $100 million to support development of a well-trained workforce, safe workplaces, and good-paying, quality jobs by working closely with partner organizations, including labor unions, with expertise in workforce development and worker health and safety.

USDA will invest an estimated $50 million in technical assistance and research and development to help independent business owners, entrepreneurs, producers, and other groups, such as cooperatives and worker associations, create new capacity or expand existing capacity.

With bipartisan support in Congress, USDA is reducing the financial burden of overtime and holiday inspection fees for small and very small poultry, meat, and egg processing plants, by 30 percent and 75 percent respectively, which provide farmers and ranchers with local alternatives to process livestock and poultry.

USDA has made $32 million in grants to 167 existing meat and poultry processing facilities to help them reach more customers by becoming Federally inspected through the Meat and Poultry Inspection Readiness Grants Program.

With this grant funding, meat and poultry processing businesses can cover the costs for improvements, such as expanding existing facilities, modernizing processing equipment, and meeting packaging, labeling, and food safety requirements needed to achieve a Federal Grant of Inspection under the Federal Meat Inspection Act or the Poultry Products Inspection Act, or to operate under a state’s Cooperative Interstate Shipment program.

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