Patrick Wall
Beef Specialist
Iowa State University Extension and Outreach
patwall@iastate.edu
This phenomenon is certainly not new; in regards to animal protein, it’s actually a resurgence to the system of old. In the 1960s and 70s, many small towns had a locker plant that could handle a significant portion of the local production. In reality, the consumer demand to "buy local" or source their food from someone they know and trust has been going on in the Midwest for over a century. Unfortunately, the options consumers had to buy local beef slowly eroded away over time. A number of things were at fault: food safety regulations often take the brunt of the criticism from the rural community, but the migration of the rural population to more urban areas definitely played a role, as well as the consolidation of our food system in general.
Regardless of the history, the recent closure of a number of large-scale meat processing facilities and the subsequent backlog of market-ready livestock caused virtually an immediate spike in the demand for locally processed beef. In the course of a week, most locker facilities went from being a few weeks out to get an animal processed to literally being booked through the spring months of 2021. Some were booked solid before the plant closures ever occurred. The rapid backlog in that segment of the industry only highlighted the relative scope of locker plants versus the large corporate packers that dominate meat processing in the US.
To gather some perspective, there are currently 111 red meat slaughter facilities in the state of Iowa, 38 of which can further process and resell product, and 73 facilities that are “Custom” plants, where the product can only be used by the owner(s). Since inspection and sales records are kept from the 38 plants that offer retail product, we can analyze that information a bit further. Collectively, across beef, pork, goat and lamb combined, these 38 facilities process only 5,000-6,000 head annually. If we use some cowboy math and assume the same rate of production for the 73 custom facilities, we only add another 11,500 animals to the annual harvest. Given the sheer size and cooler space required for beef carcasses, we can assume that pork takes up a significant portion of the head count.
In visiting with several of these facility owners over the past several weeks, they are doing all they can to maximize production. However, to assume these businesses were inefficient before the recent influx in demand is a gross overstatement. Remember, these businesses are the ‘survivors’ of an industry that retracted over the last 40 years. In most cases, cooler space and skilled labor are the most limiting factors; they simply cannot push any more product through the physical building that houses their business. Plus, the phone is ringing off the hook!
At the time this article was composed, weekly cattle harvest was down to 75,000 head from 77,000 the week before. Unfortunately, the harvest estimate from a year ago was 118,000 head. All said, producers are still feeding roughly 43,000 head of cattle this week that normally would have entered the food chain…in addition to the backlog from previous weeks. Those pens cannot be refilled with new feeder cattle either, and the snowball effect on prices throughout the production chain is immense. As much as we would all love for the locker beef industry to absorb the shortfall, the harsh reality is that the year-long harvest capacity from this segment is just a few day’s work for a commercial packing plant. In terms of percentages, the locker plant industry is well <1% of the annual harvest.
However, the silver lining to all of this cannot go unnoticed. The demand for high-quality U.S. beef has been brought to the forefront of the American consumer, and Iowa is the mecca for producing it! There will be a day in the near future where every deep freezer is stuffed with protein produced by a local farmer or rancher. I have no doubt that the quality of product they’ll receive will bring them back for more. Some of those old buildings that housed a locker facility may be reopened, or the expansion project current facilities only dreamed of could now be a reality. In the end, if we get consumers worldwide to fire up the grill more often or take the family out for a steak instead of a frozen pizza, this will all be worth it.