NDSU assistant professor receives NIFA award to study meatpacking consolidation effects

NDSU assistant professor of agribusiness and applied economics, Thomas Krumel, has received a $273,000 award from the USDA National Institute of Food and Agriculture (NIFA) New Investigator program to examine the economic consequences of consolidation and federal intervention in the meatpacking sector.

The award will assess whether federal programs that expand meat processing capacity are improving economic outcomes in rural communities, including those across North Dakota.

Krumel said he pursued the research because, despite significant federal investment in the meatpacking sector following COVID-19, he believes we still lack strong evidence on whether those programs are working.

“Receiving the award is important for me because it validates the research program I have been building over the past several years,” he said. “The NIFA funding allows me to expand it into a larger, more comprehensive evaluation of federal policy.”

“Tom's project is compelling because it provides rigorous, location specific evidence on whether major federal investments of tax dollars in meat processing are truly improving economic outcomes in rural communities like North Dakota,” said NDSU interim vice president for research and creative activity Heidi Grunwald.

Krumel’s goal is to provide clear, evidence-based answers that help policymakers, producers and local communities better understand what is working, what is not, and how to design policies that actually strengthen rural economies over the long run.

“I am looking at whether these investments lead to increases in employment and operational growth at supported facilities, and whether those effects spill over into local economies,” he added. “More broadly, I am interested in understanding whether policies aimed at counteracting industry consolidation can meaningfully improve resilience or whether underlying structural factors limit their long-term effectiveness.”

Krumel joined the NDSU Department of Agribusiness and Applied Economics in 2021. With a research background in applied microeconomics, with an emphasis on labor markets, industrial organization and rural economic development, he previously worked as a Research Agricultural Economist at USDA’s Economic Research Service, which he said helped shape his approach to policy-driven research. Krumel has previously researched industry structure influences outcomes in rural communities, with a focus on the meatpacking sector.

Two federal USDA programs, the Meat and Poultry Processing Expansion Program (MPPEP) and the Local Meat Capacity Grant Program (Local MCap) are focused on the meatpacking industry. The MPPEP provides funding to help eligible meat and poultry processors increase capacity to encourage competition in the meat processing sector in the United States, and the Local MCap supports independently owned meat and poultry processing expansions. Krumel is studying how those impact rural communities across North Dakota.

“For North Dakotans, the benefit of this research is that it provides evidence on whether federal investments are actually supporting rural economies in a meaningful way,” Krumel said “Agriculture and food processing are central to the state, and changes in industry structure have real implications for jobs, income and community stability. This project is directly motivated by what we are seeing on the ground in North Dakota, where firms have received these types of federal grants as part of broader efforts to expand local processing capacity.”

The project supports further research at NDSU as an EPSCoR institution.

“NDSU being an EPSCoR institution is an important part of this project,” Krumel said. “These programs are intended to build research capacity in states and institutions that are historically underrepresented in federal funding, and this award contributes directly to that goal. It enables us to conduct high-level, policy-relevant research in a region central to U.S. agriculture. It also helps build long-term research infrastructure at NDSU by developing new data, strengthening partnerships and creating opportunities for future funding and collaboration.”

NDSU doctoral student Andy Meyer is also involved with the research. He co-authored a paper with Krumel titled “Temporary Subsidies, Irreversible Expansion, and Firm Exit in Asymmetric Markets,” which was published in Scientific Research.

“What began as a rough idea about temporary subsidies and market concentration evolved into a formal theoretical model of price competition with asymmetric costs and dynamic implications for firm expansion and exit,” said Meyer. “Coauthoring this paper with Dr. Krumel has been one of the most important academic experiences of my undergraduate career and directly motivated my decision to pursue a Ph.D. in economics.”

The project is underway, but Krumel expects many of the findings to come out over the next year as a result of the NIFA funding.

“Looking ahead, I see this research expanding into a broader program focused on the intersection of industry structure, labor markets and public health in rural communities,” Krumel said. “The NIFA award is a key step in that process. It builds on my previous publications and grants and sets the stage for larger projects that evaluate policy impacts at a national level. The goal is to continue developing a research program that produces rigorous evidence while remaining directly relevant to policy and rural communities.”

This research is funded by NIFA Award 1034279.