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1 1 (April 29, 2020)

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COVID-19 Disrupts U.S. Meat Supply;

Producer Prices Tumble



April 29, 2020
U.S. livestock and poultry producers entered 2020 with an optimistic outlook for prices and income. Then
in mid-March the food service sector, which accounts for a substantial share of meat consumption, was
largely shut down as most states closed all but essential businesses. A tempoary surge m retail meat
purchases offset some of the reduction in food service demand. However, in early April, the situation
worsened for producers as COVID-19 outbreaks began spreading in meatpacking plants around the
United States, disrupting meat processing and leading to some shortages of meat products in grocery
stores. The reduction in slaughter is weighing on livestock prices, reflecting shrinking meatpacker
demand for slaughter-ready livestock and poultry.
On April 12, 2020, Smithfield Foods, the largest pork processor in the United States, indefinitely closed
its Sioux Falls, SD. pork processing plant because of the spread of COVID-19 among plant workers. With
an estimated daily slaughter capacity of 19,500 head, the Sioux Falls plant accounts for 40 of estimated
daily U.S hog slaughter. More pork slaughter capacity has been lost since then because of COVID-19
outbreaks in plants operated by other processors. On April 13, JBS USA announced it was closing its
Gre cy, CO, bef plan t until April 24 because of an outbreak of COVID-19 among plant workers. Cattle
Buyers Weekly estimates daily slaughter capacity of 6,000 head at the Greeley plant, which would be 4%-
5% of daily national cattle slaughter capacity. Other beef plants have had to close due to COVID-19
outbreaks among workers. Outbreaks of COVID-19 have hit beef, pork, and poultry plants across the
country. As of April 27, at least 15 meatpackimg plants were repofted closed. Some plants have shut down
temporarily to clean and reconfigure work stations; others have not set reopening dates.
Rcportcdiy, some plants have implemented onsite temperature monitoring of employees, spread out
workers within plants, set up plexiglass dividers between workers who normally operate in tight spaces,
and spread the work of one shift over two shifts, thus slowing operating speed. Even so, some meat plant
employees have asserted that packers have not implemented adequate protective measures in their plants.
On April 26, 2020, the Occupational Safety and Health Administration updated guidCirnes to address
workplace conditions for meat plant workers. On April 28, 2020, President -I' rp annoutced that. hc
plais to sign al cxccuitis c Order that would use the Defense Production Act to classify meat processing as
critical infrastructure to keep production plants open.


                                                                 Congressional Research Service
                                                                   https://crsreports.congress.gov
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