USDA Loan Guarantee Initiative Will Boost Small, Start-up Meat and Poultry Processors

Statement by Rebecca Boehm, Senior Economist, Union of Concerned Scientists

Published Oct 4, 2021

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The U.S. Department of Agriculture (USDA) today announced a new loan guarantee initiative to leverage funding for small and mid-size meat and poultry processors and increase competition in the industry.

In July, President Biden signed an executive order to promote competition in various industries by addressing consolidation and concentrated market power that hurts farmers. A recent report by the Union of Concerned Scientists (UCS) found that in Arkansas, a key poultry processing state, industry concentration has tripled over the past three decades as Tyson Foods has grown to control an estimated two-thirds of chicken processing. The next-largest competitor accounts for just eight percent of processing.

Below is a statement by Rebecca Boehm, an economist with the UCS Food and Environment program.

“Right now, it’s nearly impossible for small, independent or new meat and poultry processors to compete with corporate giants like Tyson, Pilgrim’s Pride, Perdue Foods or Sanderson Farms, which together account for 61 percent of chicken processing revenues nationally and even more market share in places like Arkansas. The new loan guarantees will help expand marketing opportunities for poultry farmers and livestock ranchers, provide new employment options for processing plant workers and give consumers more options to support local food systems.

“Proposed legislation like the Strengthening Local Processing Act of 2021 and the Agriculture Resilience Act would further help support small and mid-size meat and poultry processors and boost funding for small-scale meat and poultry processing infrastructure.”