Eastern Iowa meat lockers see record sales due to processing plants’ coronavirus shutdowns

With the coronavirus pandemic disrupting the nation's grocery supply chain, some Iowans are rediscovering long-established local sources to shorten that chain.

'We've got more demand than we can handle right now,” Luke Kerns, one of the family co-owners of Edgewood Locker, said one morning this past week.

Spring usually is the slow season for the locker's custom processing business, Kerns said. Most years, customers who supply their own hog or cow to be butchered usually can expect it to be done in about a week.

'Four or five weeks ago, we started being booked up until the end of the year,” he said.

Customers now can't get a beef butchered until next March.

The boom at local locker plants is driven by consumer worries about a potential meat shortage and by farmers seeking alternate markets as big processing plants have been temporarily shuttered by virus outbreaks.

Some farmers are having their livestock processed to sell directly to consumers.

'On the livestock market, the prices haven't been very good and some of these farmers have been looking to get something out of their livestock,” Kerns explained.

Ray Schmidt had 16 hogs processed in late April for his Farm Story Meats, which sells pork from his parents' farm near Williamsburg directly to consumers in 13 states. The hogs usually are butchered at locker plants in Story City and in Missouri, but those facilities have warned Schmidt they can't process another order until December.

'So far, every week I have is a record sales week,” he said. 'Hopefully I can make it until then.”

Schmidt launched Farm Story about a year ago. Customers 'from Boston to L.A.” who order online receive their meat via package express. He delivers personally to customers in the Ames area, where he works full-time as a marketing coordinator for Iowa State University athletics.

'When I was in college, I started noticing more and more people were interested in where their food came from,” he said. 'It's really about transparency for the customer.”

It's also a premium market for the Chester White hogs his parents, Randy and Becky Schmidt, raise.

'It's just my dad raising them, and it's small numbers,” said Schmidt, who's heard customers' concern over outbreaks at mass-market processors.

'That's worked out to be a blessing. I'm a one-man show, my dad's a one-man show, and right now it pays to have that flexibility.”

Custom processing at Ruzicka's Meat Processing and Catering in Solon is booked out through the year, co-owner Jeff Ruzicka said.

'We've been busy anyway, but it definitely made us busier,” Ruzicka said. 'The catering came to a complete end.”

Ruzicka said the store's retail supply appears secure.

'We've been able to keep up the supply,” he said. 'Prices have been going up.”

And Nelson's Meat Market in northeast Cedar Rapids is 'super busy,” owner Jon Moore said.

'The big concern is pricing right now,” Moore said. 'The market tripled this week. Unfortunately the farmers aren't getting it.”

Spot shortages

'As the big plants went down, we did see folks shift to our smaller locker plants to process some of those animals,” said Chad Hart, associate professor of economics at Iowa State University and an Extension economist.

'But it doesn't cover fully what's needed.”

As some big packing plants returned to production after pandemic-induced shutdowns, nationwide beef production for the week ending May 9 was up 6 percent over the previous week, to 367.7 million pounds, according to the U.S. Department of Agriculture.

But that's still down 31 percent from the same week last year. Production this year is down 3.8 percent over 2019.

'From a national perspective we're short, and it's going to create regional or spot shortages in places,” Hart said.

Edgewood Locker saw three waves of increased demand.

'When this first started happening and schools shut down, there was some panic buying,” Kerns said. 'The packing plaints hadn't closed and our costs hadn't gone up much.

'All of a sudden, the packing plants had outbreaks and started to close, and we had a second wave of panic buying.”

The third wave hit last week when grocery chains set limits on meat purchases.

'We're an hour away from a Hy-Vee here, so you'd think we'd be off the hook a little bit,” Kerns said. 'Within an hour of their making that announcement, the phone started ringing.”

To handle the demand while maintaining worker safety, Kerns split the locker's custom-processing operation into two shifts.

'If we had a positive case on one shift, the other shift could at least get those carcasses processed,” he said. 'Those split shifts limited the hours we could get in custom processing. That is the core of our business. It's the most labor-intensive.”

The locker store also went to curbside-only service, further raising costs. The locker employs about 50 full time.

'We've had to raise our prices as our costs went up, and it doesn't seem to matter,” he said. 'People keep buying and stocking their freezers.”

Moore said his contracts with Nelson's suppliers were made before the big price spike.

'I've worked ahead and got plenty of supply, so we can try and weather the storm,” he said. 'If the local restaurants need anything and we've got anything to spare, we supply it at cost.

'We try to help them out. We're kind of all in it together.”

Local food, national networks

'I haven't seen demand this high in probably ever,” said Michelle Kenyon, director of Field to Family, an Iowa City-based not-for-profit working to expand access to locally produced foods.

'We are hopeful the consumer demand for local foods will continue.”

Angela Shaw, ISU associate professor and Extension specialist in food safety, said consumers can rely meat from local sources as long as the package has the U.S. Department of Agriculture's inspection sticker.

'Make sure that all the meat they buy has that inspection stickler,” Shaw said. 'Everybody's doing really good practices right now, maintaining six-foot social distancing and cleaning plants.”

Kenyon said the pandemic highlights the weaknesses of the nation's commercial food network.

'Our food system has been centralized, and that has not been ideal,” she said. 'There are less (small processors), they are farther away from the farmers, and it takes a lot more infrastructure to get their animals to the meat lockers.”

Local-food advocates hope consumer demand outlives the immediate public-health crisis.

Kenyon believes state regulators should reconsider truck-mounted mobile butcher plants that are legal in some states.

'Right now the state doesn't allow those, but the guidelines have been written and we'd love to see that,” she said. 'The system can come to (farmers).”

It would take a major increase in locally produced food capacity to shift dependency from the present system. Edgewood Locker, for example, custom-processed 3,766 hogs and 1,594 beef cattle in 2018.

'We can kill 60 to 80 hogs a week,” Kerns said. 'The big plants do that in five minutes.”

'Having a more local supply chain would definitely help,” Hart said. 'But are we willing to pay the extra cost to create that? COVID-19 is forcing us to evolve quickly, but the system will only evolve in a way people are willing to pay for.”

'It would be great to pivot to direct-to-consumer (sales) in a state where we have a lot of animals,” Kenyon said.

'Farmers are innovative, and this could be a great time for them to really shine.”