Sizeable obstacles

by Steve Krut
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Small meat and poultry processors face challenges in 2016.
Small meat and poultry processors face numerous challenges this year, including humane handling enforcement, product testing and employee recruitment, among other issues.

Two months ago, Chris Young took the reins as executive director of the American Association of Meat Processors, the trade organization representing smaller independent meat facilities in North America. Although new to that position, Young has brought with him years of plant management experience and an understanding of issues confronting small plant operators across the continent.

He feels some of the toughest challenges facing these facilities in the New Year include over-enforcement of humane-handling regulations, product testing requirements, finding and maintaining quality employees and obtaining affordable insurance coverage. 

Chris Young, American Association of Meat Processors
Chris Young, executive director of AAMP

“Handling directives for humane treatment of livestock is important,” Young emphasizes. “But we are seeing over-enforcement in smaller plants where all activities are concentrated in a very small area, perhaps in one room. A missed stun carries the label of an ‘egregious act’ and can result in anything from an NR [non-compliance record] to a suspension of inspection [on the] slaughter floor. This is a much higher level of enforcement than occurs in larger slaughter facilities because their slaughter process is usually spread out over several rooms with inspection personnel concentrated on the post-mortem side and no inspector dedicated to just the kill floor.”

Young also believes new requirements and testing for product received from other inspected plants pose onerous burdens on small plants, particularly on trim meats they receive, and that intervention steps required of them, including spraying the product, are costly and labor intensive.

He indicates that small plants have a tough time finding capable workers and providing benefits at an affordable level. One reason, he says, is the lack of affordable insurance for small facilities, particularly in the area of workers’ compensation, medical and general liability coverage. This is compounded in small plants that conduct slaughter operations, he adds, and notes that many plants can’t find carriers willing to write coverage at any price.

Young feels another challenge is coming from state inspection programs that feel the pressure of keeping up with federal expectations.

“They often feel they could lose their federal funding if they fail,” he says, “and that leads some to try and impose even more restrictive and burdensome rules for those under their charge to stay above federal standards.”

On the opportunity side, Young says a much more educated and discerning customer base is insisting on a locally raised and processed meat source.

“Many small plants have slaughter schedules at capacity for the next six months and some longer than that,” Young explains. “These customers are also opting to purchase the further-processed meats that are made there. I see a continued demand and growth for the local butcher shop and meat store. This trend is booming across the country, and is leading to many expanded and newly remodeled facilities.”

Time and money

2016 poses challenges for small meat and poultry processors
Rising demand for meat and poultry sourced from locally raised livestock represents opportunity for small processors.

Jonathan Campbell, assistant professor and extension meat specialist in the department of animal science at Penn State Univ., echoes Young’s concern about the re-validation challenges for small plant operators and warns that management will have to make sure supporting documentation is on hand and applicable to processes specific to each establishment.

“This will mean more hours that plants will have to dedicate toward compliance,” he says. “Then, there is the expected ability to demonstrate that everything is working according to the written plan. There is a limited amount of expert operators to assist on such a project.

“And if and when the Food Safety and Inspection Service follows through with its announced deadline for enforcing validation of the entire HACCP system, which includes the pre-requisite supporting programs, this will present an even greater challenge to small meat processors.”

Campbell also warns that federal signals for grinding log records could come into play and would dramatically affect not only inspected facilities, but custom, retail and hotels, restaurants and institutions (HRI) exempt operations as well. This will mean greater traceability standards, lot identification and coding for everyone, he adds.

Andy Cloud represents the third generation incoming management at Cloud’s Meats in Carthage, Mo. As part of that transition, he says the company will focus heavily on an overall re-evaluation of its products and services with an eye toward improved efficiency and earning a profit.

“We like to be known as a full-service meat business,” he explains. “Still, we have to review all of our processes and products to which are worthwhile continuing and which can be made more efficient and possibly expanded. We have grown past the mom-and-pop shop type of operation and need to rethink about everything we do and how we do it.”

Cloud contends it is difficult for his business to find qualified workers from the general labor pool and adds that he would prefer to think of having better paid but better trained employees.

“This is not to blame anyone but falls back on us,” he believes. “That means we need to do a better job of training our workers and see that we continue training them as our business evolves to new levels.”

Debra Farrara is a manager at the 10-year-old Eagle Bridge Custom Meat and Smokehouse, a meat-processing business in Eagle Bridge, NY. Difficulty finding sources for disposal and rendering services and the escalating cost of these services pose a big challenge for the 20-employee company.

“There are no composting sites or municipal alternatives for disposal,” she explains. “The increase in costs for rendering service is prompting us to think about other alternatives, including composting or incineration.

“We are also concerned about the cost of insurance, in particular workers’ compensation coverage. We had only one slip injury that resulted in a small claim in the past 10 years, but the cost to insure for claims is staggering.”

Farrara says she understands the need for changes in inspection regulations, but says the increase in new directives and procedures to follow puts increasing time burdens on small operations like Eagle Bridge. But she is also seeing a strong demand for pork products. Customers are looking for ways to produce and develop greater amounts of value-added products.

Kevin Barnhill, a former international beef buyer for ConAgra, bought a former locker plant in Blair, Neb., less than two years ago. Blair Meat Market was his experiment in retro design for a small butcher shop that would offer customers locally sourced meats and deliver personal service across the counter.

“The demand is there and it’s increasing,” Barnhill says. “In fact, I have a lineup of local livestock producers who want the custom and retail services we offer. The facility I bought was closed for some time and would need many changes to move under full inspection. And, that’s the rub. It would take virtually all my time and resources to accomplish that…the on-going amount of paperwork and recordkeeping needed to maintain inspection defies common sense.”

Barnhill operates his shop with a crew of less than six workers, including his wife, and believes the business could grow, but echoes the sentiment of others that finding “real” meat cutters and butchers with any talent is a giant task.

“We could move to the next level of growth, but finding qualified people willing to work in the cold and wet environment of a slaughter and processing plant is a formidable challenge,” he says. “In other words, the demand for the product is there, but the system of paperwork and finding a capable workforce stands in the path to growth.”

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