AURI and USDA Release Final Report on Meat Processing Sector in the Upper Midwest

• By: admin
• On: 07/22/2024 13:27:01
• In: Industry News

As part of its ongoing efforts to serve the local and regional meat processing sector in Minnesota and the Upper Midwest, the Agricultural Utilization Research Institute (AURI) is pleased to announce the publication of new research and resources devoted to Empowering Local and Regional Meat Processors.

To spur growth in very small and small meat businesses and address industry challenges, AURI produced five reports and summary briefs covering financial barriers, cold storage capabilities, industry benchmarking, waste-reducing approaches for animal hides and byproducts, a general needs assessment, as well as a Project Overview and Project Brief. Specific tools AURI created for processors include a resource database, short training videos, and information on funding sources.

The work is the culmination of a two-and-a-half-year partnership between AURI and the United States Department of Agriculture's Agriculture Marketing Service (USDA-AMS) to build resiliency within the local and regional meat processing sector. The project aimed to identify the financial barriers facing small meat and poultry processors, conduct a needs assessment to guide technical assistance and business development, and develop multiple possibilities to assist the industry in overcoming barriers. More information about AURI's collaboration with the USDA-AMS, as well as the complete catalog of briefs, reports, and tools, is available here.

AURI discerned several financial, technical, and operational issues that hold the sector back from achieving its full potential. To address these pain points, AURI made several practical recommendations that would enable growth in this important sector.

Issues/Recommendations:

• Issue: Very small- and small-sized meat processors in the Upper Midwest face facility challenges ranging from inefficient cooler and HVAC systems to a lack of space and optimal layout.

Recommendation: Expand federal funding eligibility for upgrades to onsite cold storage for smaller meat processors and incentivize investment in commercial cold storage facilities outside of high-population centers. These less dense population areas are of interest to growing local and regional processors and would satisfy multiple market channels.

• Issue: Small and local meat processors lack the information necessary to understand how their financial strengths and weaknesses or operations compare to others.

Recommendation: Support a pilot program to collect data and interpret results to help local and regional meat processors benchmark their performance and inform strategic business decisions. This data would inform the creation of an industry benchmarking tool for use by local and regional meat processing businesses and financial institutions.

• Issue: Many meat processors lack access to expertise and specialized skills to support business decisions.

Recommendation: Support community/technical colleges in starting butcher and meat cutting courses and technical assistance programs, such as USDA's Meat and Poultry Processing Capacity-Technical Assistance Program (MPPTA) with designated technical assistance providers, like AURI, to create awareness and help local and regional meat processors explore new opportunities and access resources.

• Issue: Demand for animal hides has decreased. Meat processors need new and innovative solutions to create economic value for hides and other byproducts.

Recommendation: Support the development of value-added alternative uses for hides and other byproducts, such as upcycled food products, pet snacks, composting, and waste-to-energy applications that can be implemented at little or no additional capital cost.

• Issue: A shortage of meat inspectors at both the state and federal levels exacerbates processors' challenges in understanding complex regulations.

Recommendation: Develop innovative programs to train the next generation of meat inspectors and examine the potential to incorporate technologies allowing for remote inspection following the USDA's current efforts to test remote beef grading technologies.

• Issue: Federal funding opportunities for meat processors need careful review. Feasibility study requirements can be challenging to satisfy due to short turnaround times, difficulties finding qualified consultants, high expenses, and unrealistic or inaccurate calculations.

Recommendation: Future funding opportunities could simplify feasibility study templates for smaller processors, expand eligibility for small-scale construction projects through more favorable cost-shares or project minimums, and include custom-exempt processors as eligible applicants.

“AURI's cooperative agreement with the United States Department of Agriculture-Agricultural Marketing Service produced a myriad of insightful and forward-looking research and industry analysis on a host of important topics. We stand ready to help advise on the implementation of this work to the immediate benefit of the meat processing industry and our rural communities,” says Shannon Schlecht, AURI's executive director. “Fortunately, there is no shortage of innovative solutions to the problems. We collaborated with a host of talented, dedicated professionals who are ready to engage in efforts to improve the resiliency of the supply chain and create new market opportunities. We extend our gratitude to the U.S. Department of Agriculture and our partners and supporters across the Upper Midwest region who contributed to this important work.”

AURI assists Minnesota's food and agriculture companies across the value-added agriculture space, including meat science. AURI provides experts, scientists, and creative thinkers to drive innovation and propel solutions for the benefit of the agriculture sector with a focus on Minnesota. Information about AURI's expertise and resources can be found on the organization's website.