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By Mike Moen - Producer, Contact
April 14, 2021STORY CITY, Iowa - The supply chain for meat processing still is dealing with issues caused by the pandemic, and smaller operations have been picking up the slack. A proposal in the Iowa Legislature would create a grant program to help with the surge in demand.
Supporters of House File 857 have said that when COVID outbreaks forced larger meat-packing plants to pause operations, producers looked elsewhere. At the same time, consumer preferences shifted to buying local meat.
Johnathan Hladik, policy director at the Center for Rural Affairs, said this created a logjam at local meat lockers that would like to scale up their operations, but can't. Today, he said, they're still in a holding pattern, asking the same questions: "How I can manage my business, how I can manage my product, and how I can serve my clients."
He said the bill would provide financial assistance to boost capacity at a time when some of the smaller meat-packers are booked into 2023. He added that the unpredictable nature of the business makes it hard to get bank loans. HF 857 cleared the Iowa House this week with no opposing votes, but it's unclear if it will advance in the Senate.
Ty Gustafson owns Story City Locker in central Iowa, where he estimated they've processed about 20% more product over the last 12 months. Gustafson was able to take advantage of some COVID relief funding for an initial expansion, but said more is needed to meet the demand that isn't going away.
"It would be beneficial to be able to do that without having to pause," he said, "or raise prices to make that happen."
Gustafson said he fears a price hike would prompt producers to look for other processers. According to the Center for Rural Affairs, maintaining new clients is crucial in the growing direct-sales industry for meat processing.
