Governor Kristi Noem eagerly announces the infusion of more federal money into South Dakota’s economy, this time in the form of $5,000,000 in Coronavirus Relief Funds to subsidize small South Dakota meat processors. The new Meat Processing Capacity Grant will reimburse meat processors with fewer than 60 employees for the cost of improvements that will “make an immediate impact on the State’s capacity to process or store South Dakota raised protein, including beef, pork, poultry, lamp, and bison“:
Improvements may include, but are not limited to:
- Coolers/freezers
- Contractor costs (plumbing, draining, venting, electrical work)
- Portion cutters
- Processing equipment (smoking units, sausage stuffer, etc.)
- Slaughter equipment (cradles, saws, hooks, scalders, sinks, etc.)
- Equipment or facilities to hold livestock (fences, gates, chutes, etc.)
Expenses not eligible for reimbursement include: Salaries, fringe, supplies, or parts [South Dakota Department of Agriculture, “South Dakota Coronavirus Relief Fund: Meat Processing Capacity Grant“, flyer, retrieved 2021.03.19].
Applicants must promise not to sell or transfer the equipment they buy with Meat Grant money for four years without state permission. If grantees do unload any of their government-subsidized gear, they must pay back the grant amount associated with that gear, minus five-year depreciation. But I’m nervous about the oversight there: the Department of Agriculture will be so busy with its new environmental regulation duties that it may not have time to properly check in on all of its grantees and enforce that sale-clawback provision.
Applications are due May 1; awards will be announced May 25. Any grants will be disbursed well over a year after the corporately over-hyped meat-supply chain hiccup that had little if anything to do with food insecurity during the pandemic. People aren’t going hungry because the local meat locker can’t chop up hogs fast enough; people are going hungry because governments fail to contain the pandemic and use coronavirus relief funds properly for direct relief of people in need:
The risk to food security currently does not come from disruptions along supply chains, but rather from the devastating effects of COVID-19 on jobs and livelihoods. Especially in developing countries, where social safety nets are less well-developed, COVID-19 may lead to a severe increase in poverty and hunger.27 The World Food Programme projects that the number of people in acute food insecurity could double to 265 million in 2020 unless swift action is taken.28 But even within developed countries, more vulnerable groups such as the elderly, chronically ill and poorer households may be at risk, and COVID-19 has laid bare pre-existing gaps in social protection systems.29
…the biggest risk for food security is not with food availability but with consumers’ access to food. As lockdown measures and other COVID-19-related disruptions lead to a global recession, millions are losing their livelihoods or experiencing a severe drop in their incomes. Social safety nets and food assistance programs are thus essential to avoid an increase in hunger and food insecurity [“Food Supply Chains and Covid-19: Impacts and Policy Lessons,” OECD: Policy Responses to Coronavirus, 2020.06.02 ].
The food supply chain worked out its own kinks last year, early in the pandemic. Yet Governor Noem continues to ignore the data and inefficiently pour federal money into business pockets instead of directing aid to help people in real need.
This is working to solve an actual problem, Cory, but it’s not hunger.
Due in part to the big meat supplier’s problems due to COVID, and also because people were more interested in local food, small meat lockers filled up their capacity quickly last spring. The were booked more than a year out, and still are. Many had stopped taking appointments altogether.
That’s a problem for the farmers/ranchers who rely on those lockers for their business models, as well as to process the meat that feeds their families. For example: My husband and I direct market beef, and we had had good luck in late 2019 selling hamburger. Our plan had been to test broader sales of this hamburger: Have one locker date a month, sell all the hamburger we could, and whenever we hit a wall of demand, well, that last round of hamburger would be what we’d eat for the rest of the year. We had one locker date scheduled when COVID hit. Tried to schedule another one—it would have been at least 15 months later, and they didn’t even want to write down our name. We gave up on the hamburger marketing plan for a while at least.
Now, for beef, we can still take that cattle to the sale barn. Prices are meh, but will pay the bills. For pork? That’s different problem. The timeline is shorter, so waiting for a locker date doesn’t really work, and taking a few pigs to the sale barn hardly pays for the gas to get them there. Not having space at a locker is a big problem. People have turned to home butchering. That’s a skill not too many people have anymore. And that meat would only be for at-home consumption—no business model there. Which means fewer options for consumers—you’d be less likely to find pork that is not from a confinement.
I don’t know if this grant program will help. I’m guessing the problem includes having enough workers, and this doesn’t cover salaries. But it can’t hurt. And having more capacity for local meat production would be a good thing for small-scale producers and the overall economy of rural communities, even beyond this Covid crunch.
This article is signing my song: https://www.aberdeennews.com/covid19/butchers-struggle-to-keep-up-year-after-smithfield-processing-plant-became-covid-hot-spot/article_bc62840a-87f6-11eb-8356-370a4b4300d8.html
With all the unspent covid relief help funds available. noem could certainly have provided funds for more than 2-5 locker startups with forgivable loans if they stayed in business a set number of years. There is obviously the demand out there. What South Dakota lacks is big vision and the sort of politicvian it takes to make those visions workable.
I hope Renner corner can qualify, have to keep that Spitzmur going.
Heidi, if these grants do go to local shops and help small producers gain market share with local food, and if they represent a willingness to support other local food initiatives that would support food security and self-sufficiency for all South Dakotans, then hooray!
But I wonder: is there a contradiction between funding these small slaughter houses and lockers and still handing out hundreds of thousands of tax dollars to big concentrated animal feed lots that produce beef at factory scale for the big Packers who make it harder for those local producers to find a foothold in the market?
There’s part of why this program doesn’t sit quite right with me. in and of itself, the program seems a reasonable investment of tax dollars in increasing local economic opportunity and food self-sufficiency. However, it seems to miss supply tax dollars that were intended to provide immediate relief for problems created by the pandemic. As you say Heidi there are still some big weight times caused by the initial supply chain disruptions that would be nice to resolve. So I guess in a way, this very late application of coronavirus dollars is addressing a problem related to the pandemic.
Additionally, this support for local food production doesn’t seem to be part of a comprehensive strategy for building local food and self-sufficiency. It doesn’t plug-in with anything else the state does; It kind of feels like a cute ploy by Kristi to co-opt coronavirus dollars to spend on something she likes better than public health: “Oh, I don’t want to be seen looking like I take the pandemic seriously, so let’s spend the money on good old red meat!“
If we are blowing billions of dollars of “covid” money we should at least get some more meat out of the deal.
Of course Grudz, I’m sure South Dakota will spend it well to help those in need.
You are, indeed, probably correct, Mr. Anderson.
I’m not sure why both problems can’t be addressed. I know in many places there are food deserts. In my city, they are trying to address this issue.
What it takes is not “big vision,” but understanding that solving these small problems is what community development and job growth is about.