Locally grown meat from small-scale farmers could be a thing of the past after another Victorian abattoir revealed it would not take on any more small orders.

Kilcoy Global Foods, otherwise known as Hardwicks, which has an abattoir near Kyneton in central Victoria, said it wouldn't take orders below 15 head of beef or 50 head of lambs from the start of next year.

The letter sent by the company to existing clients said the decision was made after a "detailed review of our existing arrangements".

"Our updated arrangements will help us and our customers remain competitive in this tough market," the letter said.

It means small-scale farmers will be forced to travel further to get their animals processed, putting pressure on a the welfare of the animals, and the economic viability of the businesses.

Large foreign multi-nationals dominate the meat processing sector in Australia, including Brazil-owned JBS and US-owned Teys-Cargill.

Kilcoy Global Foods bought Hardwicks in 2021. The company is ultimately owned by a Beijing-based company.

Local meat could be off the menu

Award-winning food writer Richard Cornish said there was an unfolding "crisis" in which consumers were losing access to meat grown in their region.

"We have foreign-owned abattoirs closing down opportunities to eat some of the best quality food in the world," he said.

He said it was particularly damaging for small towns which had well-known restaurants such as Daylesford's Lake House and Brae in Birregura, which sourced locally grown food and drew thousands of visitors to the region.

"It's those high level, really, really high-end primary producers who are doing really great work that people will drive for miles and miles for," Mr Cornish said.

"They're putting … money into the pockets of those businesses, [which] in turn puts money in the pocket of the small farmers."

Animal welfare worries

Tammi Jonas, who farms pigs and beef at Eganstown, near Daylesford, said she had relied on Hardwicks to process her animals for more than a decade.

"We had no troubles until Kilcoy brought [the abattoir] in 2021," she said.

Ms Jonas is also president of the Australian Food Sovereignty Alliance, a collective of farmers who support locally based sustainable food systems.

She said thousands of small-scale producers could be affected by the decision.

She said she was in the process of building a micro-abattoir, which was scheduled to be completed in May next year, because she didn't want to be reliant on processors in fear of closures.

Ms Jonas said the Hardwicks closure was disastrous for farmers who lost local slaughter options.

"It means they have no options for cattle or sheep," she said.

"For some who are able to truck animals further, many hours, there will be a terrible animal welfare decline."

She said there were not enough other processors to pick up Hardwicks' small clients.

'Fast track' solution

A report from the securing the Victorian food supply inquiry released last week included a recommendation to "to negotiate small livestock producers' ongoing access to kill facilities in the short-to-medium term".

It also recommended the government "support small scale livestock producers to establish micro-abattoirs (including mobile micro-abattoirs) in communities which can demonstrate a need for this critical shared agricultural infrastructure".

"They need to fast track that so people can build micro-abattoirs like ours," Ms Jonas said.

"If you've got small animals like pigs, goats or sheep, a 40-foot container re-fit can be done in three months.

She said her organisation had written to the Hardwicks board to give people an extension so they had time to get a project over the line.