By Ernie Birchmeier
Walking into your local meat plant or butcher shop, there’s something enticing about the scent of smoked meats, and your mouth starts to water seeing freshly cut chops, steaks and roasts filling the counter. Snack sticks and jerky tempt your taste buds and you can’t leave without a treat or two for the drive home.
The COVID-19 pandemic caused supply-chain issues throughout the food industry. One of the hardest hit segments was the livestock sector and meat-packing industry.
Livestock producers got stung by plant closures as 40% of our beef and pork processing capacity stopped when workers got sick. Farmers who normally supply those processors also saw extra costs from feeding and caring for animals longer than normal.
Grocery store meat selections grew thin — sometimes empty — and consumers panicked and started fretting about meat availability. Many turned to small and medium-sized processors for their animal protein. For them, business is booming; most in Michigan are booked solid through the rest of this year.
Is this an opportunity for more small processors? Time will tell — time and money and a heavy regulatory burden. Michigan’s meat-processing industry is defined by two different programs…
At any large (and some small and medium) facilities processing meat for retail sale, inspectors from the USDA’s Food Safety and Inspection Service must be present to supervise slaughter and processing. They must follow a Hazard, Analysis and Critical Control Points (HACCP) plan that defines mandatory standards but doesn’t prescribe guidelines; it’s up to plant management to determine how they comply.
USDA determines if the plan is sufficient and if the operator is following it. Violations can shut a plant down or lead to fines and penalties; it’s regulatory-driven and compliance is expensive. The HACCP plan requirement forced many small and medium facilities to go away from federal inspection during the last 20 years.
The second system is Michigan’s Custom Exempt Slaughter Program, which allows consumers to buy an animal directly from a farmer and contract with a local processor for slaughter and processing.
Michigan has many such facilities across the state. Their capacity is limited but they’ve flourished during the pandemic. When meat got scarce at grocery stores, consumers sought out custom-exempt facilities to fill their freezers. They booked up quickly with new business, leaving many of their suppliers — small and mid-sized farmers — with nowhere to send market-ready livestock.
Meat processing is expensive and labor intensive. Those with financing and workers can succeed. At least one major facility in the region would like to add a second shift but can’t secure the workforce. Smaller facilities could face similar problems.
Compliance with the regulatory burden is also challenging and expensive. HACCP, pollutant discharge permits, local regulations and licensing requirements all cost money — costs that must be met in order to stay in business. Regulatory compliance takes such deep knowledge and understanding, dedicated staff is often necessary just to stay on top of it all.
So there’s a lot to think about as you pick up beef, pork, lamb or poultry from a local packer or a major grocery chain. Should smaller-scale options be more plentiful? Has our food industry become too consolidated?
Chew on that while I get back to my jerky…
Ernie Birchmeier manages MFB’s Center for Commodity Farm and Industry Relations; reach him at 517-679-5335 or [email protected].
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