October 20, 2020
Written By Jason Jenkins
Pandemic Puts Pressure on Local Processors
As a boy, Mike Cloud anxiously anticipated the flip of the calendar page from June to July, and it wasn’t just because of the ensuing Fourth of July holiday. While the parades and picnics, festivals and fireworks meant lots of fun for Mike and his sister, Karen, the arrival of July ushered in a different kind of independence day for the Cloud kids — freedom from the family’s meat-processing business.
“Mom and Dad loved to fish,” says Mike, who owns Cloud’s Meats in Carthage, Mo. “We’d shut the plant down on the Fourth of July and head for the lake for two months. We’d open back up at Labor Day. Back then, there just wasn’t any business in the summer.”
Today, however, it’s an entirely different story for Cloud and local meat processors across the Show-Me State. Turning pages in the calendar now reveals month after month of solid bookings from customers who wish to have cattle and hogs processed. It’s the result of the global coronavirus pandemic, which sent disruptive shockwaves through all aspects of American life, including the U.S. food supply chain.
“Through the years, the meat industry has changed a lot, and really I thought it had changed all it could,” Mike admits. “But that was before this spring and the spread of COVID-19.”
Food Industry Impacts
In the United States, it took the coronavirus less than two months to spread from the first confirmed case in Washington state to all 50 states. Seemingly overnight, schools, restaurants and non-essential businesses were shuttered, and Americans were advised to “shelter in place” in an effort to slow the virus. The resulting panic-buying stripped grocery store shelves bare as people tried to prepare for the unknown.
Yet at the same time that Americans were hoarding toilet paper and canned goods, another impact of the virus would surface: the U.S. food system’s inability to handle an abrupt shift in patterns of supply and demand.
The disruption manifest itself quickly as dairies were forced to pour milk down the drain, and vegetable growers had no choice but to plow under fresh produce. At the nation’s large meat-processing facilities, labor shortages and measures to protect workers from the virus slowed production and even caused some temporary shutdowns.
As a result, the wholesale value of beef and pork increased sharply. According to data from the USDA’s Economic Research Service, the “live-to-cutout-spread,” which is the difference between the price paid for the live animal and the wholesale price of the processed animal product, reached an all-time record.
At the same time, there was rapid decline in the value of live animals. Poultry and hog producers were instructed to “depopulate” their barns, and a backlog of market-ready cattle began stacking up. While USDA data indicates that farm-gate prices for beef dropped by 5 percent from February to May, the wholesale price more than doubled.
“That’s when our phone really started ringing off the hook,” says Rob King, owner of King Processing and Catering in Marceline. “When the big guys sort of dropped the ball, people began to panic and started trying to get meat where they could find it.”
The King family has been in the meat-cutting business since Rob’s father, Dick King, bought the shop in 1980. The custom-exempt slaughter and processing facility employs six, including Rob and his wife, Connie, who took over responsibility for the operation in 2003.
“We cut five days a week, and then we’re open a half-day on Saturdays for meat pickup and carry-out,” Rob says. “Beef is our main thing. We offer 21-day dry aging on beef. That’s where the tenderness comes from.”
In a typical week, the crew at King’s processes 13 cattle and nine hogs. When pandemic panic led to higher prices and purchase restrictions on meat at grocery stores, the calls for sides of beef and hogs began pouring into the shop.
“I don’t know anybody in the small processing business who has ever experienced anything like the upswing right now,” Rob says, noting that coronavirus concerns have brought their catering business to a standstill. “We’re booked for a year solid. We even have some animals booked into 2022 for processing. If you didn’t have a reservation, there’s no room at the inn, so to speak.”
The story is similar at Cloud’s Meats in Carthage, where the federally inspected facility began processing on Saturdays to keep up with demand at the same time that its catering clientele also disappeared.
“Overall, our business has prospered through this, which makes me feel kind of guilty,” Mike says. “Agriculture is hurting right now, but we’ve held our prices on what we paid the farmers for their cattle and especially their hogs.”
At Hetherington’s Meat Processing in Clinton, owner Jim Hetherington, who works alongside his son, Jack, says they are cutting five days a week and processing more animals than ever. He admits he never dreamed that business would boom like it has in 2020.
“I was really kind of looking to retire in about a year, but now I don’t know if that’s going to happen,” says the elder Hetherington. “We’re booked out a little over a year. Instead of processing 15 or 16 beefs a week, we’re doing 20 to 24, along with 12 to 15 hogs. With so many people wanting animals butchered, we’re not aging beef past 14 days right now, simply because of space and to keep everything running smoothly.”
Coping with COVID
The influx in business during the past six months has prompted both King Processing and Hetherington’s Meat Processing to discontinue a service that many, especially in rural communities, might take for granted: deer processing this fall.
“It’ll be the first year since my parents started the business back in 1952 that we won’t be doing any venison processing,” Jim says. “We’ll make sausage or snack sticks if they bring us deboned meat, but we have so much beef and pork to do, we didn’t feel like we could stop.”
Concerns over a resurgence in COVID-19 cases guided Rob’s decision. “When we do deer, we shut all of the other processing down,” he says. “If we do that, and the virus fires up and brings the world to a halt again, then we have nothing. If a guy had to make a choice, he is going to be able to cut up his own deer a whole lot easier than he can cut up his own beef.”
In Carthage, hunters will be able to bring their deer to Cloud’s this fall, Mike says. He notes that the decision by other meat cutters to forgo venison processing will impact his business.
“Right or wrong, we’re accepting deer this year,” he says. “We’ve never needed any more business during deer season. With others not doing it, it’s going to mean lots of business.”
Recognizing the need to increase meat-processing capacity within the Show-Me State, Gov. Mike Parson and Director of Agriculture Chris Chinn announced the creation of the Missouri Meat and Poultry Processing Grant in late July. This effort directs $20 million in grants from the federal coronavirus rescue package toward small processors to bolster food supply chain resilience and avoid disruptions.
Federally inspected, state-inspected and custom-exempt processing facilities with fewer than 200 employees were eligible to apply for the reimbursement grants, which ranged from $20,000 to $200,000, depending on the facility and its operations. The deadline to apply was Aug. 31.
“They’ve put up some pretty good money to help with reconfiguration of plants, new equipment and a bunch of other stuff,” Jim says. “We put together our wish list and submitted our application. I think we stand a pretty good chance of getting some money for upgrades.”
Meeting Challenges, Serving Customers
While the coronavirus pandemic has altered daily life and ushered in a “new normal,” meat cutters like Cloud, King and Hetherington are no strangers to change, especially in their industry.
“When my dad started, there were little bitty farms all up and down the road, and there were small processing plants every 10 to 20 miles to butcher a beef and a hog or two for every family,” Rob says. “Now, a lot of those little farms and families are gone.”
Not only has the clientele changed, but so, too, have their tastes. Rob says he gets requests for specialty cuts that go beyond the traditional T-bone or pork chop.
“Just the other day we had a guy request belly bacon out of this calf. It was something he’d seen on a cooking show,” he says. “The muscles on the animal haven’t changed. It’s the way you break them down, so you have to stay on top of those things.”
While the muscles themselves haven’t changed, the same can’t be said for the animals brought in for processing. “When I started back in 1976, a big beef generally weighed 600 pounds,” Jim says. “Now, 700 pounds is a small beef. We’re consistently processing carcasses today that weigh 900 to 1,000 pounds.”
Mike says another change is the disappearance of markets for by-products of meat processing such as leather, bonemeal and offal, which includes the entrails and internal organs.
“Back in the early 1960s, my dad would get paid $400 a month for his bones and guts. Now, I’m paying $2,000 a month to get rid of it,” he explains. “We throw hides away because there’s no money in them anymore, which is sad.”
What has never changed, all three butchers agree, is their commitment to providing their local communities with a valuable service and trusted source of safe, healthy and affordable protein.
“It’s not one of those industries where you’re ever going to get rich, but you’ll always be busy because people are always going to eat,” Rob says. “It’s just really about doing high-quality work that people are happy about. We’re feeding people that were little kids coming in with their parents, and now they have families of their own.
“It’s not glorious. It’s not glamorous. But I enjoy what I do.”