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Vilsack: USDA to spend $4 billion to improve supply chains

The Agriculture Department will spend $4 billion to “strengthen the food system, create new market opportunities, tackle the climate crisis, help communities that have been left behind, and support good-paying jobs throughout the supply chain” under President Biden’s Build Back Better initiative, Agriculture Secretary Tom Vilsack announced today in a news release and telephone press conference as the White House released a final report of a strike force on supply chains.

“The COVID-19 pandemic led to massive disruption for growers and food workers. It exposed a food system that was rigid, consolidated, and fragile. Meanwhile, those growing, processing and preparing our food are earning less each year in a system that rewards size over all else,” Vilsack said in the news release. “The Build Back Better initiative will make meaningful investments to build a food system that is more resilient against shocks, delivers greater value to growers and workers, and offers consumers an affordable selection of healthy food produced and sourced locally and regionally by farmers and processors from diverse backgrounds. I am confident USDA’s investments will spur billions more in leveraged funding from the private sector and others as this initiative gains traction across the country. I look forward to getting to work as co-chair of the new Supply Chain Disruptions Task Force and help to mobilize a whole-of-government effort to address the short-term supply challenges our country faces as it recovers.”

Vilsack did not announce specific spending plans today but said, “Funding announcements under the Build Back Better initiative will include a mix of grants, loans, and innovative financing mechanisms for the following priorities, each of which includes mechanisms to tackle the climate crisis and help communities that have been left behind” including food production, food processing, food distribution and aggregation and expanded access to markets for a diversity of growers while helping eaters access healthy foods.



USDA added, “As it makes investments through this initiative, USDA will also seek to increase transparency and competition with attention to how certain types of conduct in the livestock markets and the meat processing sector have resulted in thinly-traded markets and unfair treatment of some farmers, ranchers and small processors. Among other investments in the food system and food supply chain, Build Back Better will specifically address the shortage of small meat processing facilities across the country as well as the necessary local and regional food system infrastructure needed to support them.”

In the telephone news conference, Vilsack said he hopes to use the program to attract beginning farmers, create a pilot program for small food processors, help foodhubs and to encourage the consumption of healthy food developed in a fair and healthy system.



He also noted that today’s announcement followed an announcement last week that USDA would buy an additional $1 billion in food for distribution.

Asked about the court case on line speeds in meat plants, Vilsack said that the parties are talking. He said the court ruling puts USDA in a position of balancing worker safety, food safety and farm income. The decision on the appeal was the solicitor general’s.

Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., said in a news release, “During the pandemic, we all saw how important the people who keep our food supply chain running are to our country. Whether they’re farmers or truck drivers or grocery store clerks, they keep our shelves stocked and our families fed. The funding we fought for in the American Rescue Plan will help to protect and strengthen small and midsized meat processors, expand cold storage, increase access to healthy food, boost local and regional food systems, and support small farmers. Overall, these investments will help the supply chain recover from COVID-19 and be better prepared to weather the next crisis, too.”

National Farmers Union President Rob Larew praised the effort.

“The lack of competition, transparency, and resilience in the meat supply chain is something ranchers have been concerned about for some time – but these problems have been mostly overlooked by legislators and regulators until the past 18 months, when pandemic-related disruptions, natural disasters, and security breaches made them impossible to ignore any longer,” Larew said in an email. “We are encouraged by the steps USDA is taking with its Build Back Better initiative to strengthen local and regional food processing infrastructure, which will create a buffer for future shocks to our food system. Ideally, the agency will follow up with greater protections for farmers and regulatory reforms that prevent anticompetitive behavior.”

Funding is provided by the American Rescue Plan Act and earlier pandemic assistance such as the Consolidated Appropriations Act of 2021.

–The Hagstrom Report

 


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