July 2, 2012
On June 19, USDA’s Economic Research Service (ERS) released a report titled “Slaughter and Processing Options and Issues for Locally Sourced Meat.” The report sought to evaluate “the availability of slaughter and processing facilities for local meat production and the extent to which these may constrain or support growth in demand for locally sourced meats.”
The paper reports that while per capita meat consumption has been declining in the US, beef produced in alternative systems (i.e. natural, certified organic, grass-fed) has grown about 20 percent per year for several years. Sales of foods sold direct-to-consumer have doubled in the past decade, yet, direct-to-consumer meat and poultry sales have not kept similar pace, despite the fact that most direct-to-consumer meat is produced in the alternate systems mentioned above.
Small locally-focused producers cite lack of access to slaughter and processing facilities as the main hindrance to entering local direct-sales markets. Small producers often cannot use large facilities due to concerns with uniformity, economies of scale, biosecurity, or brand ownership. The report states, “The total number of small-scale livestock slaughter facilities has declined over the past 10 years, as have slaughter volumes at small-sized plants – the same facilities in which local producers typically process livestock.”
ERS found that though small operations (fewer than 10 employees) still make up the majority of slaughter facilities in the US, they account for a minority of total livestock slaughter. “Over the last 10 years, just over 1 percent of cattle were slaughtered in plants that process fewer than 10,000 head of cattle per year… 55 percent are slaughtered in plants that process 1 million or more head per year.” Even more dramatically, over 89 percent of hogs are processed in plants that slaughter 1 million or more head per year.
The study found that an interplay of supply, processing, and demand shortages caused various difficulties for local direct meat sales. Many parts of the country that have abundant small livestock farms lack appropriately-sized slaughter facilities, whereas in New England, there is sufficient slaughter infrastructure but a lack of facilities that can cut and wrap meat for retail sale. In other cases, small facilities that are willing to accommodate small producers cannot rely on the unsteady and seasonal supply these producers often provide.
The report also discussed alternatives that small producers can consider when they cannot access appropriate slaughter facilities. Mobile slaughter units (MSUs) are small facilities than can be transported to individual farms or collective gathering sites where farmers can have their livestock processed in small quantities. Though faced with a different set of challenges, MSUs can fill a role for small livestock growers who lack access to nearby or appropriately sized slaughterhouses.
Alternatively, the report suggests that small farmers form cooperatives or aggregate their livestock in order to meet larger facility requirements. Operating under a set of shared production guidelines, these producers can provide a small- or mid-scale processor with consistent steady business, as well as brand themselves for more effective local or regional marketing.
The report concludes, “Innovations along the supply chain, such as more efficient distribution of local foods, including meat, … are in development and currently functioning in some regions of the United States. But expansion of the local meat sector will continue to depend on the willingness of consumers to pay premiums high enough to absorb the costs associated with the particular production program, processing, and the remainder of the supply chain.”