Agriculture Secretary Vilsack announces plan to transform the food supply chain

At an event at Georgetown University on Wednesday, U.S. Secretary of Agriculture Tom Vilsack detailed the USDA’s new framework to make the food industry supply chain more resilient, level the playing field for smaller producers, make nutritious food affordable and boost underserved communities.

The announcement comes during a period of massive food inflation and supply chain bottlenecks, as the lingering effects of the pandemic and the Ukraine war continue to drive high prices and product shortages.

The framework’s $2 billion in funding is targeted at food production, processing, distribution and consumers. Highlights include up to $300 million to help transition farmers to organic production methods and up to $75 million to support urban agriculture. The administration is targeting new funding for workforce training, food safety certification and supply chain infrastructure. The framework also includes a $155 million increase in funding toward the Healthy Food Initiative, to improve access in food deserts.

The new framework continues the Biden administration’s focus on rebalancing power in the food industry. In January, President Biden detailed a $1 billion plan to support competition in the meat sector, with $375 million going toward supporting independent meat and poultry processors’ projects.

In a question and answer session, Vilsack said that the USDA’s role in increasing competition in the meat and poultry sector is to control capacity, and that it is strengthening the Packers and Stockyards Act to “balance the system on behalf of producers and processors.” The law, first passed by Congress in 1921, aims to ensure fair competition in the meat and poultry industry by preventing monopolies.

Vilsack said Biden’s investment in smaller meat plants earlier this year has increased competition because applicants were able to scale up their operations and sell across state lines. He added that over 250 companies have applied for the funding since Biden’s January announcement. Also previously announced was a $275 million investment, in partnership with lenders, to provide loans to independent meat processors.

“These loan funds will provide needed capital to address future plans these plants have to expand, improve or increase capacity,” Vilsack said in his address.

The USDA announced as part of the new framework $100 million in funding to support workforce training at processors, something Vilsack said extends from plant workers to the rest of the workforce. About $40 million will be given to training programs overseen by the National Institute of Food and Agriculture (NIFA) in risk management and sustainable agriculture research, and those focused on workforce development for meat and poultry processing.

“This is not just for the folks who are processing, it’s also the folks who inspect and are engaged in management,” Vilsack said. “What we hope to be able to do is make sure that we continue to train and encourage folks to participate in these jobs by making them aware of the industry.”

USDA will also invest to boost independent business owners, entrepreneurs, producers, and groups such as cooperatives and worker associations to help build capacity. 

The aid within the new framework was not only focused on the meat industry. Part of the USDA’s investment includes $600 million in grants for non-meat and poultry food sectors to help them expand capacity and build upon existing infrastructure. 

“While major strides are being made in efforts to create a more resilient food system, additional investments will be needed to expand cold storage, warehousing and other key components of the overall processing component of our food system,” Vilsack said.

In comments after his formal remarks, Vilsack said these non-meat investments are not directed at any specific industries and will be determined based on applicants.