The short- and mid-term impact of COVID-19: meat processing

The viability of meat processing in the overall food and agriculture supply chain came into question when the COVID-19 pandemic exposed its vulnerabilities. It also created questions about its long-term resilience in the face of widespread disruptions.

The nation’s “just in time” meat supply chain, for example, faced major meat processing and distribution disruptions when COVID-19 cases clustered among packing plant workers. Those cases led to higher consumer meat prices and nervousness around food shortages in the U.S. These consumers largely expect exactly what they want when they want it at the grocery counter.

Though the system is massively efficient, the situation showed it lacks resilience when facing disruption as serious as a global pandemic. Here’s where the situation stands today and where we think it could be headed.

Efficiency versus resilience

A tight labor pool, a hyper-efficient production system, consumer cost containment and sustainable market prices for livestock are all components the meat industry is challenged to maintain and balance. With the COVID-19 pandemic added to that equation, it’s easy to see how the food production and distribution efficiency we’ve created is coming back to haunt us.

“The pandemic made us victims of our own success. We’ve succeeded in creating these really efficient supply chains. That’s great. We experience the benefits of a food supply that’s cheaper and more available than anywhere else in the world, which is a great thing in a consumer economy,” according to Todd Thurman, owner of and consultant with SwineTex Consulting Services, LLC, who works with pork producers around the globe to develop animal production and management systems. “But when efficient supply chains break, we don’t have much recourse.”

But is the inverse relationship between efficiency and resilience irreversible? What has to happen to ensure the COVID-19 meat processing situation doesn’t happen again in the future?

“It’s hard to find a balance between resilience and efficiency without saying you’re going to concede your efficiency, but innovation is the way to do it,” Thurman said. “I certainly hope the COVID-19 situation spurs that innovative spirit.”

The meat processing supply chain as a value chain

The beef supply chain, for example, must first become a true value chain for all participants. Doing so will build more overall resilience by creating multiple value propositions for producers and others involved. Cow/calf producers, backgrounders, feeders and finishers can be financially rewarded for products and practices that do more than just contribute to efficiency. This will instead put a higher priority on innovating financially valuable ways to connect to constantly evolving consumer demand.

Consider this example. Is there a way for producers to earn a premium for lowering transportation distances to reduce carbon emissions associated with delivering to the packer? This may give distributors an opportunity to market beef as “carbon-friendly.” It allows them to secure additional price premium for environmentally conscious consumers.

Or can processors pay producers a premium for more consistently sized animals? This may streamline meat processing and create new flexibility by enabling packers to operate at a lower percentage of total capacity.

Both strategies could improve resilience without sacrificing total system efficiency. So next time a disruption like COVID-19 comes along, the meat supply chain can recover more quickly.

A foundation of innovation

The meat supply chain is no stranger to innovation. It’s just been largely focused on the genetic side of the business. Producers aim for consistently sized and shaped carcasses. This enables processors to better handle a higher volume with fewer adjustments to processes and equipment. But even with a focus on genetics and consistency, no farm or animal is identical. Even minor changes in environmental conditions can cause major variance from animal to animal.

“It goes all the way back to feeding animals more efficiently. We can reduce the disconnect between the plant and the farm by thinking in terms of automation. We can facilitate change at the farm level that shows up on the processing side,” Thurman said. “Integrating more automation in the process takes consideration starting on the farm level.”

Challenges to automation

Complete carcass standardization is just about impossible right now and will remain so for the next few years. However, there’s still room for future automation with robotics. Once processed, the individual animal is no longer the primary measure of meat quantity. Automating the handling of meat in specific “boxed” quantities versus the carcass level can enable artificial intelligence-driven robotics to streamline the process. It won’t completely eliminate the need for human labor as automation will in fact depend on human input and direction.

“We’ve been automating certain processes in our meat plants for some time, but we still have problems with the inconsistency of product. We can do a lot to address it, but at the end of the day, you’re never going to have a cookie-cutter pork chop, even with cloned animals. They just experience the environment differently. Even if you take a whole barn of cloned animals, you will still see variation,” Thurman said.

“But we’re seeing plants use AI to be able to adjust to those biological differences and limitations. We’re just not able to be as exact as in the car business, where a robot picks up a door and puts it down on the same hinge spot in the same location every time. We will continue to see the technology advance so it can make judgment calls. The machine will be able to ask where the rib is and whether it can trim a specific cut of fat. It will know to look for that rib or fat and won’t be cutting the same spot every time.”

Resolving the efficiency versus resilience debate

The resulting system will be one in which meat is processed in a manner that merges human workers with robotics. It will create new efficiencies and contribute resilience to the process where the COVID-19 pandemic showed it was most needed. Meat processors will be able to operate entire plants at a lower percentage of total operating capacity. This will make it possible to shift production to another plant more easily in the event of work interruption.

The robotic technology necessary to make this happen isn’t readily available on a wide scale yet, but it’s close.

Scalability will also be an issue. Especially due to the initial cost to integrate new tools and the sheer scope of the meat packing industry. As the meat processing technology sector matures, robotic processing technology will decline in cost and become more available. The result: the end of the efficiency versus resilience debate.

“I don’t think you need to compromise as we start to better tackle these problems in the meat industry. There are solutions now that can carve up a meat carcass and portion it and effectively package it. The technology has evolved a lot in the last five years,” said Josh Lessing, co-founder and CEO of RootAI, an agricultural robotics technology company. “We can have resilience and efficiency with this technology.”

The COVID-19 impact on agriculture

The impact on meat processing technology from the global pandemic is just one component of the agriculture industry. Jeff Caldwell has explored the ripple effect and discussed with the experts across all segments of the industry. This includes impacts on farm machinery, local and global markets, and farmland. Explore the whole COVID-19 impact on agriculture blog series and let us know what you think!

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