Amid the great pandemic of 2020 here are a few impacts that COVID-19 has had in the agriculture world….besides the toilet paper shortage!
As many have probably been following or felt first-hand, the onset of the Corona virus brought with it a drastic fumble to the markets. On March 12, the DOW Jones dropped 2,353 points (or 10%). This was the biggest one-day drop of the DOW since 1987.
Going hand-in-hand with the DOW, the NASDAQ also saw it’s own drop within the same 24 hours.
Following suit, the grain markets also took a significant dip, with corn falling 9 1/2 cents/bushel and soybeans falling 12 3/4 cents/bushel.
In the days following, the grain markets continued to dive even more into the red.
Continuous days of market decline has taken it’s toll not only on Wall street business men and women, but also an emotional toll on the American farmer (as some try to market remaining grain, build break-evens, etc.)
Retail Health Precautions
With my current career role as a sales agronomist, we’ve seen a few changes around the work place. Prior to the busy growing season, we usually see quite a few meetings in preparation for planting, as well as plenty of customer/employee time.
In addition to contact with others, we also see quite a bit of our seasonal inputs (seed, fertilizers, and pesticides) arriving in almost daily.
As the great pandemic of 2020 has caught fire, my company, Central Valley Ag (a cooperative) has been implementing it’s own practices of keeping locations quarantined, social distancing, and passing around the company-wide supply of Lysol!
Though we, as retailers, have been told, unless a farmer has a social distancing preference, we’re currently still able to make calls on our farmers as we continue to prepare for #Plant2020.
One thing I’ve been encouraging my farmers to do is to take whatever seed, fertilizer, or chemical they have room for or ability to take at their own headquarters now.
This not only ensures that our farmers are well prepared and not waiting on inputs from us (in the grand event we do get shut down or more likely if some of our crew becomes sick and we’re short staffed.
BUT it also provides us more room to bring in additional inputs that we will need later in the season.
At this point, being the beginning of April, the sheds are full of seed and boxes of chemical.
Our tanks are full of liquid fertilizers for planting, however, after the rush of planting season we usually have a window of time where we try to stock up our later season needs or “post-emerge/post-planting” needs.
Though these needs are a little less than prior to planting, these inputs are still quite crucial to the success of the remainder of the season.
Given the year we’ve had so far, there’s been concern that with temporary shut-downs or layoffs of businesses, there will will be a scramble to not only re-supply items that were on-hold but also a scramble to get these items delivered as well.
In short, from a retail perspective: with the great pandemic of 2020, we’ve been concerned about ordering products in-season and getting them in a timely manner.
HOWEVER, with President Trump declaring agriculture as an “essential critical” part of the nation’s workforce this input supply concern has drastically decreased.
Enough doom and gloom though!!
When you’ve got lemons, try and make lemonade!!
Lower Interest Rates
A positive effect of the great pandemic of 2020 are lower interest rates overall. For farmers and ranchers with operating notes, any payments on land, etc. this is quite a BIG deal.
For these agricultural heroes, low interest rates creates opportunities for them to:
- Refinance and consolidate debt
- Improve cash position through working capital and lines of credit
- Lower their overhead and input expenses
Farmers and ranchers are no strangers to a volatile industry though. These men and women are full of both perseverance and innovative thinking to bring them through uncertain times.
I have no doubt that this new challenge of the pandemic will be no different than other trying times.
Rational thinking and financial preparation are the best tools to keep handy for the American farmer and rancher for the road and challenges ahead this year.
Overall, I think we can all agree that we’re facing some trying and uncertain times. COVID-19 definitely poses challenges we haven’t yet faced in our lifetime.
In these uncertain times, I think it’s important that we remember to keep our head with whatever job or occupation we have, to protect those we love, and (most importantly) to stay calm with whatever this new season of 2020 brings.
Remember…we’ve got this!
DON’T WANT TO MISS A THING?
-The Farmer’s Wife-
Still looking for more information on COVID-19 impacts on the agriculture industry? Check out the links below!