Meat and poultry industry will lose billions if sequestration takes effect on March 1st


The meat and poultry industry will lose billions of dollars if the Department of Agriculture is forced to furlough food safety inspectors due to sequestration.

Unless Congress passes a $1.2 trillion deficit reduction package by March 1, sequestration – or across-the-board cuts to discretionary spending mandated by the Budget Control Act of 2011 – will cut $51 million from the USDA’s Food Safety and Inspection Service [FSIS].

Read more: 5 key facts about sequestration

“Consumers would experience limited meat and poultry supplies, and potentially higher prices, and food safety could be compromised,” wrote USDA Secretary Tom Vilsack.

The budget shortfall will require the USDA to furlough food inspectors for as much as 15 days and result in a nationwide shutdown of over 6,200 meat and poultry plants.

The sequestration-induced furlough – or unpaid temporary leave – would cost the meat and poultry industry about $10 billion and cost plant workers $400 million in lost wages. In addition, livestock producers will incur costs for feeding and storing the animals longer than normal due to the production disruption.

The additional costs and product shortage will hike up the price of meat, chicken, and eggs at the grocery stores.

The USDA feared that some small food establishments – such as family-owned restaurants and grocers – would not be able to weather the supply shortage and higher prices.

“The impact could force smaller businesses and merchants out of business,” according to the USDA.

Furthermore, sequestration would eliminate inspections of food exports and cut back on inspections of imported food.

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