The Wisconsin Farmers Union released a report in January on the decades-long struggles the US meat processing industry has had with consolidation and the impacts on farmers, consumers and workers. In 2020 and 2021, access and consolidation issues within the meat processing sector have been highlighted as priority issues by UMA. The grassroots organization convened a task force that developed a network analysis and collected resources to further address meat processing issues.
According to the WFU report, multinational meatpackers control 54% of poultry processing in the United States, 70% of pork packaging in the United States and 85% of beef packaging in the USA. Just 50 meat plants slaughter and process 98% of the US meat supply.
The report also states that the farmer’s share of the retail food dollar is only 14 cents.
“Investing in meat processing infrastructure allows farmers to market their animals directly to consumers and regain some control over profits,” the report says.
Dominant companies in the meat processing industry have come under scrutiny for price fixing, labor rights violations, misleading labeling and other unsavory practices, the report notes. During the pandemic, the fragility of this highly consolidated system and the impact this has on farmers, consumers and workers have become evident.
“Because of the market share of these companies and their power to work together to undermine the market, everyone is suffering. Small and medium-sized meat processing plants are struggling to compete and are disappearing from the countryside, leaving farmers and consumers with fewer options,” the report says. “As smaller processing options disappear, animals are shipped further afield. Farmers who sell directly to consumers often rely on local processors who are uniquely positioned to handle smaller harvests and personalized cutting instructions.Farmers who sell to larger markets, such as the barn at auction or through contracts, find themselves subject to wildly fluctuating prices and beholden to livestock specifications that increasingly lean in favor of meatpackers, often ignoring the cost of prod farmer’s contribution.
Small and medium-sized processors also struggle to thrive in these conditions. Not only are they competing in a low-margin industry, but they also have to work against the power of massive industrial players who spread risk across many facilities. It is also difficult to find, hire, train and retain skilled workers who can adapt to different roles in a small business and understand the unique cutting needs of a range of different carcasses from regional producers. . Large-scale industry may choose to process only certain animals and streamline each cut into a factory-like assembly line.
According to the report, while these two scales of processing ultimately create similar products, they are radically different businesses. “The problem affects more people than farmers and those working in the meat processing industry. Rural communities suffer both cultural and economic impacts as processing companies disappear, taking with them jobs and support from other businesses in the region.
But it’s not just a rural problem; the freedom of choice of all consumers looking for meat products is affected. As consumers scrutinize the brands they see on grocery store shelves, there is a serious lack of transparency about which companies ultimately own each brand, how prices were determined and where the meat in the packages came from. in front of them.
WFU outlines several solutions to meat packaging issues in the report, including:
- Access to capital is a big struggle for many small processors. Often, physical facilities, aging or small equipment, and cold storage capacity are factors limiting growth. Improving facilities, capacity and ergonomics is often essential, but requires significant capital investment for these small businesses. Access to low-interest loans or grants would help overcome these barriers.
- Many smaller processing facilities are located in rural areas with relatively small pools of skilled employees. For this reason, many facilities provide some level of on-the-job training for new employees and focus on reducing employee turnover through other incentives. It would be useful to reduce the downward pressure on prices exerted by the consolidated industry.
- Small-scale processors must manage a high level of complexity within their businesses as they work with many small-scale producers and customers.
- Consumer education is needed on topics such as local food, labeling and how to buy directly from farmers, if we are to rebuild regional food systems.
- Creating shorter and more diverse supply chains for meat will reduce the carbon intensity of the livestock industry. Strengthening small- and medium-scale processing supports farmers, many of whom use sustainable management practices on their farms.
Investing in meat processing is an investment in the security of our food supply, and as the WFU report indicates, it is a necessity.
“Expanding processing capacity opens the door for farmers to regain some control by marketing animals directly to consumers,” says WFU President Darin Von Ruden. “However, we also need to increase competition and fairness in the marketplace and fight misleading labels.”
To view the report, go to wisconsinfarmersunion.com.
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