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US announces new investments to expand meat and poultry processing capacity

More than $223 million in grants and loans will increase competition and economic opportunities for meat and poultry processors and producers around the country, and help lower costs for working families

Posted on Nov 07 ,05:17

U.S. Department of Agriculture (USDA) Secretary Tom Vilsack announced that the Biden-Harris Administration is investing $73 million in 21 grant projects through the first round of the Meat and Poultry Processing Expansion Program (MPPEP). MPPEP delivers on President Biden‘s call to increase competition across the economy to help lower costs for American families. This announcement will expand meat and poultry processing capacity, which in turn increases competition, supports producer income, and strengthens the food supply chain to lower costs for working families and create jobs and economic opportunities in rural areas. In addition, the Administration is investing $75 million for eight projects through the Meat and Poultry Intermediary Lending Program, as well as more than $75 million for four meat and poultry-related projects through the Food Supply Chain Guaranteed Loan program.

USDA is delivering on the multi-pronged goals of these investments:

• Supporting producer-focused business models: Montana Premium Processing Cooperative (MPPC), a start-up cooperative, created in partnership with the Montana Farmers Union and Farmers Union Industries, will use MPPEP funds to provide independent producers in Montana with an option for a local USDA inspected meat processing facility in an area that is currently without Federally inspected processing.
• Strengthening Local and Regional Food Systems: Vermont Livestock Slaughter & Processing connects hundreds of farmers in Vermont and the Northeast with the individuals, families, schools, and businesses they supply. With their MPPEP investment, they are now prepared to revitalize and modernize their multi-species facility, tripling their throughput.
• Reducing barriers to processing: Cutting Edge Meat Company, a facility in Leakesville, Mississippi, provides pork and beef processing for producers in Mississippi, Alabama, Louisiana, and Florida. With this investment, they will significantly increase their capacity and shorten the six-month backlog for processing currently facing producers.
• Competing at scale: Greater Omaha Packing in Omaha, Nebraska, will open new opportunities for cattle producers by expanding their beef processing capacity by 700 head per day. The project will also support an additional 275 jobs.
• Restoring jobs in rural places: Pure Prairie, recently purchased a shuttered poultry plant in Charles City, Iowa, with the goal of returning hundreds of jobs to the small rural community and increasing poultry processing in the upper Midwest. The project sources directly from growers in Minnesota, Wisconsin, and Iowa, who are also shareholders and part owners in the company.
• Empowering family-owned businesses: New Stockton Poultry in Stockton, California, is a family-owned business that sources and processes specialty chickens to meet demand within a variety of immigrant communities and beyond.

The investments announced are part of a series of financial assistance tools to support producers and lenders in increasing capacity in the food supply chain.

MPPEP was designed to support capacity expansion projects in concert with other private and public finance tools. The announcement is the first round of funding made available through Phase I of MPEPP. Additional announcements are expected in the coming weeks. USDA will also soon begin taking applications for a new phase to deploy an additional $225 million, for a total of up to $375 million, to provide gap financing for independent processing plant projects that fill a demonstrated need for more diversified processing capacity.

The Meat and Poultry Intermediary Lending Program (MPILP) provides grant funding to nonprofit intermediary lenders who finance – or plan to finance – the start-up, expansion, or operation of slaughter, or other processing of meat and poultry. The objective of the MPILP is to strengthen the financing system for independent meat processors, and to create a more resilient, diverse, and secure U.S. food supply chain. In the first round of MPILP $75 million was awarded to eight lenders in seven states. Applications for second cycle ($125 million) are currently being accepted and are due December 31, 2022.

Through the Food Supply Chain Guaranteed Loan program (FSCGLP), USDA partners with lenders to guarantee loans to help eligible entities expand meat and poultry processing capacity and strengthen the U.S. food supply chain. Lenders provide the loans to eligible cooperatives, corporations, for profits, nonprofits, Tribal communities, public bodies and people in rural and urban areas. Since the FSCGLP was launched in December 2021, more than $250 million in loans have been guaranteed for projects in the middle of the food supply chain.

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