USDA says more than $200M will help meat processors expand

OMAHA, Neb. — The Agriculture Department announced more than $223 million in grants and loans Wednesday to help small- and mid-sized meat processing plants expand as part of a larger $1 billion effort to boost competition in the highly concentrated industry.

The effort is expected to increase cattle and pig slaughter capacity by more than 500,000 head a year. It will also help poultry plants process nearly 34 million more birds, while adding more than 1,100 jobs mostly in rural areas where the plants are located.

The Biden administration wants to add meat processing capacity to give farmers and ranchers more options where they can sell the animals they raise. This while hopefully reducing prices for consumers by increasing competition, given that the biggest companies now have so much power over pricing in the “highly, highly concentrated and consolidated” business, Agriculture Secretary Tom Vilsack said.

In beef, the top four companies control 85% of the market, while the top four companies control 70% of the pork market. The four biggest poultry processors control 54% of that business.

“We’re looking forward to these projects taking hold and creating new opportunity and new choice for producers and consumers,” Vilsack said before touring a beef-processing plant in Omaha, Nebraska on Wednesday.

The USDA’s announcement, combined with Vilsack’s plant tour, comes as President Joe Biden is highlighting his achievements to voters before Tuesday’s midterm elections. Several of the administration’s recent announcements have targeted rural areas in states that generally support more Republicans than Democrats.

Vilsack said the Greater Omaha Packing company will use its grant to expand beef processing capacity roughly 30% to handle 700 head of cattle per day and add 275 more jobs. The Omaha company is one of the biggest of the 21 grant recipients nationwide that will share $73 million. Greater Omaha will receive a $20 million grant to help pay for a planned $100 million expansion of its plant.

Iowa farmer Dan Pedersen who feeds about 12,000 head of cattle a year on his farm near Underwood that he sells to Greater Omaha said the project will be welcome because it will bring more competition to the area.

“Any time you have more demand than supply, you’re going to win,” Pedersen said.

Some of the other grants will go to helping Pure Prairie reopen an idle poultry processing plant that will employ hundreds of people in Charles City, Iowa. And the Cutting…