For Arizona ranchers who have spent years navigating long waits at custom meat plants and limited marketing options, recent changes at the United States Department of Agriculture’s Food Safety and Inspection Service (FSIS) are worth investigating.

About 90% of the meat processing plants FSIS regulates are small (establishments with 10 to 499 employees) or very small (fewer than 10 employees or annual sales under $2.5 million). USDA launched the Small Processors Action Plan last June with an aim to strengthen support for these operations while maintaining food safety standards. 

In a recent conversation focused on practical support for small processors and the ranchers who depend on them, FSIS Administrator Dr. Justin Ransom described a deliberate shift in approach under the current administration.

Along with other voices, Arizona Farm Bureau and Dr. Ransom explored what these possible improvements might mean to beef producers and meat packers. 

The Three FSIS Pillars

The Small Processors Action Plan is organized around three efforts.

Strengthening direct support: USDA delivered $20 million in fiscal 2026 to reduce overtime and holiday inspection fees, cutting them 30% for small plants and 75% for very small plants. That relief has been extended through Sept. 30, 2027. USDA Rural Development also ran a fourth round of the Meat and Poultry Processing Expansion Program, and on Oct. 26, USDA announced $57 million in tentative awards to 147 processors in 40 states, pending congressional allotment. FSIS expanded access to its subject matter experts and improved response through AskFSIS and the Small Plant Help Desk.

Improving policy clarity and predictability: FSIS published an Advance Notice of Proposed Rulemaking on how establishment size is defined, so those categories better reflect how the industry operates today. The agency modernized its appeals process with electronic tracking and a web-based submission option. It is also providing plain-language explanations in notices and directives.

Expanding state partnerships: Recently, USDA announced the Stand-Up Program, up to $50 million to help states start or expand their own meat and poultry inspection programs, since start-up costs have deterred states from participating. New Mexico became the 31st state with an approved State Meat & Poultry Inspection (MPI) program (approved by USDA and inspected at the state level) on Sept. 18, and Georgia became the 11th state in the Cooperative Interstate Shipment program in July. FSIS continues working with additional states.

State MPI programs enforce laws and safety standards that are "at least equal to" federal requirements under the Federal Meat Inspection Act and Poultry Products Inspection Act.

 

Arizona and the Cooperative Interstate Shipment (CIS) Program  

While Georgia is the 11th state accepted into the Cooperative Interstate Shipment program, Arizona has yet to become part of it. The program allows state-inspected meat and poultry processors to ship their products across state lines and sell nationwide if accepted into the program. According to Ransom, Arizona ranchers and processors have a clear path to broader markets if the state chooses to pursue it. “It really starts at the state level. If a state meat and poultry inspection program wants to ship product across state lines, the state can apply for a Cooperative Interstate Shipment agreement,” Ransom said. That agreement allows products produced under state inspection to move across state lines within the United States. “So, it’s not that difficult.”

With the recently launched Stand Up program that provides up to $50 million in new funding to help states start or expand their own meat inspection programs in partnership with the USDA and FSIS, states can better understand their options. “There’s a pool of money to help states build out those programs, which can ultimately recruit more custom-exempt establishments into state meat and poultry inspection. And for those already in a state program, how do we give them access to broader geographies and allow them into interstate shipment?”

To further understand Arizona’s opportunity on CIS, we talked to the Arizona Department of Agriculture’s director, Paul Brierley. “Arizona has operated a very successful Meat and Poultry Inspection Program that allows in-state sales of local beef for over 100 years. At AZDA we are working with USDA leadership, including Dr. Ransom, to understand all the implications and incentives for adding the Cooperative Interstate Shipping program in Arizona, and also exploring the desire of Arizona producers to use the program.  We are excited about the opportunities but want to make sure we don't put resources into establishing a program that nobody uses.”

 

Moving from Custom-Exempt to State Inspection  

Arizona currently has roughly 30 custom-exempt establishments, with many being niche and seasonal and only processing game meat. Under custom-exempt status, “they can’t sell meat from a local producer,” Ransom noted. “They can harvest that animal, but the meat has to go back to that producer. If we can get them state inspected, then those local processors can start selling that product, whether it’s at the farmers market, to somebody down the street or in the next county over.”

The goal is to grow capacity where communities want to support local businesses — and to do it in a way that works economically. “Everybody’s got to make money, or this doesn’t really work.”

He emphasized that custom-exempt plants already produce safe products; the difference is the level of regulatory presence and documentation. Daily inspection is not required for custom-exempt operations, but state and federal are subject to daily inspection. “There are more requirements that assure us the food is safe, and that puts it into a much broader net of commerce. That’s really the reason we add inspection: it’s going to affect a larger population of people, and as regulators we’re trying to protect public health.”

Moving from custom-exempt to state inspection is “probably the biggest step in terms of expectations for documentation and for your food safety systems,” Ransom explained. It is the first step into a broader commercial network. “State inspection asks more than custom exempt, CIS asks more than that, and then obviously we have federal inspection. It’s really about meaningfully helping establishments on that journey, which maybe we haven’t done as good a job of in the past as we’re trying to do now.”

Yavapai County rancher and Farm Bureau member Tim Petersen confirms Arizona’s market and how challenging launching a plant is for those interested. He recently spoke to this issue on the Arizona Farm Bureau’s Talk to a Farmer/Rancher Friday. “A slaughter plant is a very expensive building to launch and operate. And trying to find meat cutters is tough. You go to most grocery stores and all the meat comes in a box. It's all boxed meat. That's our industry now.”

Petersen retrofitted and refurbished an existing USDA-inspected plant for his beef business and explained it was the hardest endeavor he’d ever carried out in his professional life.

“The other challenge is there’s really not a lot of money in the business of processing meat,” he added. “Most of these non-USDA plants do wild game, and that’s their big nut for the year. Although we’ve been able to get the pricing up a little bit, now a guy must pay these high cattle prices and then pay the processing on top of it.”

He went on to explain that building and running a fully operational plant must be a collaborative effort between business interests, the state and federal entities. 

 

What’s Changed Day-to-Day for Small Plants This Year? 

According to Ransom, FSIS is working to support small and very small establishments in more meaningful ways. “This isn’t something that is brand new. Administrations have been trying to work on this for the last 10 or 15 years,” Ransom explained. “How do we help these small businesses? The Trump administration has taken a different tactic. We’ve stepped back a second and said, OK, what’s working? What’s not working? What can we do better? And it’s not just throwing money out there, but how do we invest it with the right people to be able to move forward in a new and powerful way?”

Practical steps already in place include a streamlined appeal process. For example, when a small establishment disagrees with an inspector’s opinion or receives an enforcement action, operators can now go directly to USDA’s small plant help desk website and appeal. 

The appeal routes to the district office and hopefully speeds the process. “There’s no hurt feelings,” Ransom said. “It’s about how they get access to people to get feedback quicker and more efficiently, and hopefully a quicker response.”

Another resource is AskFSIS, designed specifically for small and very small plants. “It’s about trying to answer questions in non-government speak. So many times, we answer a question with a long, hard-to-understand regulation that doesn’t really help that establishment.”

 

The Real Obstacles for New Plants  

Ransom did not sugarcoat the realities. “It’s a tough business. Let’s face it. Having a small or very small establishment is a lot of work. It takes a lot of money to get started, and that’s obviously the first big obstacle. You’ve got to be passionate about it.”

What the administration is trying to support through the Ranchers First initiative, he said, are the people who are passionate and who connect with local producers to bring local products to market. “All these initiatives really support local, small processors working with local ranchers, giving them new opportunities to market their products locally.”

 

The SPUR Loan Guarantee Program  

For plants already operating and ready to expand cooler space or slaughter capacity, the SPUR program offers a 90% loan guarantee. Operators need to come up with 10%, “and there are different ways to come up with that. They need a smaller down payment than they would if they went to a bank down the road,” explained Ransom. The program is designed for establishments dealing with tight cash flow and limited capital or collateral. “The federal government is coming in and saying, we’re going to support these loans and make it more favorable for banks to participate.” Investments can range from around $1 million to much larger figures depending on the operation.

Eligibility for a SPUR loan includes, but are not limited to: 

  • Establish, reopen, retrofit, expand or improve a processing facility engaged in the processing of meat, poultry, or seafood for commercial markets. 
  • Purchase and development of land, buildings and infrastructure for commercial or industrial use.
  • Purchase and installation of machinery and equipment, necessary improvements, Strengthening Processing for U.S. Ranchers upgrades, renovations or retrofits to an existing facility. 
  • Purchasing manufacturing systems, information technology systems and commercially available new technologies that promote worker safety or food safety. 
  • Refinance debt to create cash flow and create jobs.

What are some of the loan terms? 

  • The maximum loan amount is $175 million. 
  • Interest rates — which can be fixed or variable — are negotiated between the lender and borrower. 
  • SPUR loans may allow up to a two-year deferral of principal and interest payments. 
  • Loan terms cannot exceed 40 years. 
  • Borrowers must demonstrate loan funds will remain in the U.S., and the facility being financed will create new — or save existing — jobs for U.S. residents

Grants for Small Processors  

In recent months, 147 grants were awarded to help smaller plants make moderate-sized investments in equipment and efficiency. While regional reports have confirmed funding for processors in states like Texas, Kansas, Montana, and Missouri, the USDA has withheld the granular list of all 147 specific facilities pending final congressional funding allocations. “A grant is the federal government investing in your business so you can be more successful,” Ransom said. “If you’re a small or very small establishment that needs some help growing your business, this is a great example of a program specially designed to invest in that business and get it where it needs to be.”

He was clear that these are not FSIS programs. “We are merely connecting the dots for people. We’re the regulator, so we, or the states, have a daily presence in these establishments. We’re the closest to the people who are asking for the money.” The investments are appearing across the country, not just in states with large numbers of inspected plants. “We know the impact these establishments can make in local economies, supporting rural producers and small towns. That’s what this is all about: people, and connecting the people in the supply chain in a way that helps everybody in a really tough business environment for bringing protein to American consumers.”

 

What Arizona Ranchers and Processors Should Do Next   

Ransom offered three concrete steps. 

First, go to the USDA website and look up the Ranchers First initiative. “It lays out all the programs we’re doing to support ranchers across the country. Ranchers First is really about growing the beef herd, connected to finding more processing capacity closer to where these animals are raised.”

Second, work with local custom-exempt processors and help them understand the value of moving into the state inspection program. “Being state inspected really helps their business sell more product from the animals being harvested in their local communities.”

Third, if the state is interested, pursue the cooperative interstate shipment program. “That allows them to move products across state lines, and that’s sometimes a real shot in the arm for businesses trying to grow. They just need more people outside their local community to buy their products. This is a way to grow the network of where they can market their products.”

The work underway reflects a large investment aimed at supporting both producers and processing establishments. “Droughts over the years have left us with the smallest beef cow herd in recorded history. How do we help in this critical moment? People dispersed their cattle herds. We want them to get back into business so we can rebuild the American beef supply,” said Ransom.

Demand for beef remains strong. Ransom was firm on this market reality. “But we want it to come from America’s beef producers and American companies. We’re excited about this work and look forward to continuing to work with industry as we advance an important mission of feeding America with the safest food supply in the world.”

For Arizona ranchers looking for more local options and a clearer path from the ranch to the plate, the combination of Ranchers First, improved small-plant support, state inspection pathways and the CIS program offers practical next steps. The details are available on the USDA website, and the state’s own meat inspection program is the place to start conversations about what expanded capacity could look like in Arizona.

In the food supply chain, shelf life is the unforgiving force that shapes everything from processing timelines to market strategy. “Shelf life drives it, right?” Ransom said. “When you’ve got a tight shelf life, it forces you to get good at it. Especially in the food supply chain.” That reality, he noted, makes reliable local processing capacity essential for ranchers who want to market product closer to home and on timelines that match their animals and their customers.