There are basically four types of inspection a meat processor can operate under:
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Federal Inspection (USDA)
The United States Department of Agriculture's Food Safety and Inspection Service (USDA FSIS) is responsible for this type of inspection. Federally inspected products can be shipped over state lines (interstate commerce) and internationally to many countries. Federal inspection requires a HACCP plan, SSOPs, daily inspection of processing facilities, and, if the plant slaughters livestock, antemortem and postmortem inspection of every animal.
State Inspection
Only 27 states offer state meat inspection programs in the U.S. USDA FSIS maintains a listing of these programs. Only 25 of these states offer state poultry inspection in addition to red meat inspection. While state inspection programs are required by law to be "at least equal to" federal inspection in terms of regulatory rigor, state inspected meat and poultry products cannot be sold across state lines (restricted to intrastate commerce).
Retail-Exempt
Retail exemption allows a meat processor to sell meat at its own retail storefront without developing a HACCP plan. However, the processor is still subject to periodic, risk-based inspection by USDA FSIS and/or state authorities, and the meat used to produce retail products (fresh cuts or processed meats) must come from livestock inspected by USDA FSIS or the state inspection agency in the processor's own state. A retail-exempt processor can also sell a limited amount of product on a wholesale basis to hotel, restaurant, or institutional customers, as long as the product has NOT been cooked, cured, smoked, rendered, refined, or otherwise processed in a manner not listed in 9 CFR 303.1(d)(2)(i)(a),(b),(d), or (e). Retail-exempt wholesaling is limited to 25% of the dollar value of the processor's total sales or $60,200 for red meat and meat products and $50,200 for poultry products per calendar year, whichever is less (Federal Register June 29, 2010).
Custom-Exempt
A custom-exempt plant can only slaughter and process livestock for the exclusive use of the owner(s). Like a retail exempt plant, the facilities will still be subject to periodic, risk-based inspection by USDA FSIS and/or state authorities.
A red meat plant can simultaneously do work that is custom-exempt, retail-exempt and state or federally inspected; a poultry plant cannot. Depending on the state, a plant may or may not be both state and federally inspected. There are several federal poultry processing exemptions, all of which are complex and only exempt facilities processing less than 20,000 birds per calendar year.
