Projects across the country are set to receive funding from Department of Agriculture initiatives seeking to expand the number of processing facilities available to livestock producers.

The funding comes via loans and grants and tops $223 million. Some 21 states are set to receive funding in this first round of announcements through USDA’s Meat and Poultry Processing Expansion Program, the concept of which USDA first announced last year.

USDA expects the announcement to expand beef, pork and mixed processing capacity by half a million head per year and poultry processing by 34 million birds per year, said Agriculture Secretary Tom Vilsack. All told, the projects are estimated to create about 1,100 long-term jobs, a figure Vilsack noted does not include the construction jobs required to build or expand funded facilities.

Vilsack said more announcements can be expected “hopefully in December, and if not, certainly early in 2023.” USDA plans to look comprehensively at the projects receiving funding, he said.

“The goal here obviously is to try to get the best projects to make sure we are relatively diverse in terms of product mix and in terms of geography,” Vilsack said.  

Opening more facilities became an ag industry priority following the shuttering of massive packing plants during the COVID-19 pandemic.

The nation’s largest meatpackers have funneled more and more animals into fewer plants in the name of efficiency, but that efficiency sent shocks through the market in 2020 when a single plant shutting down due to COVID-19 concerns among its workforce led to sizable percentages of the nation’s processing capacity coming offline. In many cases, animals were euthanized because there was no available processing facility that could take them.

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The funding, made available through MPPEP, the Food Supply Chain Guaranteed Loan Program, and the Meat and Poultry Intermediary Lending Program, was awarded following evaluation of criteria that included environmental analysis, community support, and a handful of other factors.

Facilities are also required to notify USDA in the event of financial hardship that might cause the business to be put up for sale for the next 10 years. Vilsack said the notification would trigger several options for USDA, but the department has no plans to buy back any of the facilities.

“(USDA) could potentially take a look at additional loans, they could steer the facility to a re-lending opportunity … I mean, there’s just a series of options that are available to USDA but purchasing those facilities is not one of them.”

Vilsack said he was not worried about the new facilities falling victim to the labor constraints that have impacted some of the nation’s larger packing plants, noting the small- to mid-size operations funded in the announcement will require a much smaller workforce.

“I think this is a good day for producers, a good day for those interested in working in these facilities, a good day for the communities that will benefit and a good day for consumers,” Vilsack said. “We're looking forward to these projects taking hold and creating new opportunity and new choice for both producers and consumers.”

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