The US Department of Agriculture (USDA) has announced a $500m investment to increase the meat and poultry processing capacity in the country.

The move aims to help farmers, ranchers and consumers to have more options in the marketplace and build a better food system.

The USDA will provide funds through the American Rescue Plan to encourage and support new competitive entrants in the meat and poultry processing sector.

By supporting new processing facilities, the USDA aims to address the concentration issues within the meat and poultry sectors.

Of the total investment, USDA agreed to provide more than $150m to small and very small processing facilities to help them weather the Covid-19 pandemic.

The federal agency will provide $55m to small processors to help them to stay in the marketplace and expand their processing capacity.

A $100m investment has been allocated to help small and very small processing plants withstand the volatility and unexpected costs imposed by Covid.

US Agriculture Secretary Tom Vilsack said: “The Covid-19 pandemic led to massive disruption for growers, food workers, and consumers alike. It exposed a food system that was rigid, consolidated, and fragile.

“To shift the balance of power back to the people, the USDA will invest in building more, better, and fairer markets for producers and consumers alike.

“The investments USDA will make in expanding meat and poultry capacity, along with restoration of the Packers and Stockyards Act, will begin to level the playing field for farmers and ranchers.”

The investment by the USDA is in line with US President Biden’s executive order on promoting competition and building a more resilient supply chain and better food system.

Going forward, USDA said that it will make additional investments under its Build Back Better Initiative fund and implement new measures.