16 May 2011

2 minute read

North America

Investing in Iowa's small meat processing plants could have positive local impacts in rural communities, according to a new report by Iowa State University economist, Dave Swenson.

Dr Swenson analysed the state's meat processing facilities for the Marketing and Food Systems Initiative at the Leopold Center for Sustainable Agriculture. His report, Exploring Small-Scale Meat Processing Expansions in Iowa, is available on the Leopold Center's web site [click here].

Iowa is a prominent leader in the nation's meat-packing industry, particularly in cattle and hogs. Yet the state's farms have declined over the past two decades, and growing numbers of Iowans live and work in urban centers. Rural decline raises the question of whether small meat processing plants can continue to compete with larger processors.

Small plants in Iowa are generally more labour-intensive than large ones, with less return on the labour. Dr Swenson's study found that small plants require significantly more employees, providing 13.3 jobs for every million dollars of meat compared to the statewide average of 4.7 jobs. Employees in small facilities typically receive less pay, although there is room to develop skilled trades through training programmes.

With increasing demands for specialised meat, like grass-fed cattle and pasture-raised hogs, small processing plants have the opportunity to fill profitable niche markets. Consumers who buy from local plants fuel job creation and keep more money within the community, a concept called the 'local multiplier effect'.

Dr Swenson's study suggests that investments to improve the efficiency of small plants can make them more competitive, as well as give a boost to the local economies of nearby rural communities.

The Leopold Center highlighted Dr Swenson's research in the Iowa Local Food & Farm Plan, which offers recommendations to the Iowa state legislature for nurturing robust local foods production.

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