Victoria's meat processing facilities will be able to lift staffing capacity limits from 67 per cent to between 80 and 90pc from 11.59pm Sunday night.
The new levels were announced on Sunday as the 14-day rolling average of new cases in regional Victoria dropped to 0.6 and 22.1 in metro areas.
Premier Daniel Andrews said that under the latest rules regional abattoirs and processors would be able to increase capacity to 90pc while metro based facilities would increase to 80pc (except in the case of poultry processors where the limit was lifted to 90pc)
The workforce limits for supermarkets and food distribution centres would return to full capacity, he said.
At the same time, and recognising the increased risk in some of these environments, there'll be additional obligations for employers, including regular surveillance testing of staff, nightly deep cleaning, separating workers into consistent bubbles, and providing regular training for their workers," Mr Andrews said.
VFF Pastoral Group president Leonard Vallance said the increases were a good first step, but abattoirs needed more surety for their supply chain.
He said there needed to be risk based assessment for abattoirs to ensure forward-purchased livestock could be processed and forward-sold product could be delivered .
He said a risk based assessment would prevent a whole facility being shut down because of one positive test result.
Australian Meat Industry Council (AMIC) executive officer Patrick Hutchinson, said AMIC had been at the forefront advocating for the easing of the 33 percent reduction in peak onsite workforce for its Victorian meat manufacturing members.
"There has been lengthy consultation, provision of data, following all DHHS advice and implementing strict COVID safe plans, resulting in zero reported cases by DHHS for the meat manufacturing sector for over three weeks," he said.
"We are still working on the functional details under the Victorian Premier's roadmap system on restricted workforce, including testing and on-site COVID safe plan management.
"We had continually growing concerns around livestock supply blockages, and workers being in limbo for an extended length of time should the 33 percent reduction continue.
"Today's announcement eases those concerns, but we are not at 100 percent yet, so there will remain impacts on the supply chain from processors, wholesalers, cold stores, independent local butchers and even supermarkets," Mr Hutchinson said.
AMIC recently polled its Victorian members, which included the large cohort of retailers, meat processors and smallgoods manufacturers, on the impacts to supply with workforce capacity remaining at 67 percent.
Results showed that the current restrictions had delivered, in some cases, up to a 40 percent reduction in meat supply to certain businesses. There had also been an initial impact on the peak spring lamb season, due to constrained ability to buy lambs under normal conditions. Also, pork products, such as Christmas ham production, having already started, also experienced some supply issues, including restricted order taking and supply to smaller businesses, such as independent butchers.
"Due to these results, AMIC will continue to work closely with the Victorian Government towards pre-COVID normal meat and smallgoods supply, and hopefully soon be able to send the message to domestic and export customers that the Australian meat supply chain is fully open for business," Mr Hutchinson said.
Mr Andrews said that the move to the third and the last steps would no longer be defined by dates but instead "trigger point" based "solely on reaching our case number targets".
He said that meant that the sooner those targets were reached "the sooner we can consider our next steps".
Mr Andrews said people should continue to get tested "when you're sick".
"To keep your distance when you're out. To follow the rules and listen to the health advice," he said..
"It also means continuing to wear a face covering. And with more people moving across our city, our public health team have advised the rules around wearing a mask need to be strengthened.
"Victorians will now be required to wear a fitted face mask, covering the nose and mouth. Some of the concessions we made as we adjusted to this new normal - things like wearing a scarf or a bandana or a face shield - will no longer apply."
Mr Vallance also warned that the forecast of a wet spring and summer could see a "horrendous" fly season.
He questioned who would be responsible for animal welfare charges if livestock producers could not get sheep crutched due to a lack of shearers.
He said New Zealand tourists were going to be permitted, so NZ shearers should also be permitted.