The Roundup -

Ag Producers Feeling The Impact Of COVID-19


COVID-19 continues to impact activity around the world, with the agriculture industry being no exception.

The pandemic has hampered exports of American agricultural products, disrupted processing and marketing channels by shutting down restaurant sales, and many meatpackers have slowed production at meat plants, and some have even temporarily closed. Prices of agricultural commodities are dropping, and low prices are expected to persist for months.

According to an updated economics report published in April by the Food and Agricultural Policy Research Institute at the University of Missouri, U.S. farmers, who have already been hurt by U.S. trade disputes, are projected to lose up to $20 billion in net income for 2020.

"Probably the biggest sector of agriculture that is feeling the hit from COVID-19 is the livestock industry. I am sure that most everyone has seen or heard of reports of milk being dumped, pigs being disposed of, and chicken eggs being broken. Although we don't have any large producers of milk, poultry, or pigs in our area, this and other factors are still taking a toll on the cattle and sheep markets," explained Richland County Extension Agent Tim Fine.

During the COVID-19 pandemic, producers are facing uncertain times. So in order to help alleviate the financial crisis farmers and ranchers are experiencing, President Donald Trump announced a new $19 billion Coronavirus Food Assistance Program on Friday, April 17. This relief package will entail $16 billion in direct payments to farmers and ranchers and $3 billion in agriculture spending.

According to a statement released on April 17, by Senator John Hoeven, (ND), chairman of the Senate Agriculture Appropriations Committee, $9.6 billion will go to the livestock industry – with $5.1 billion for cattle, $2.9 billion for dairy, and $1.6 billion for hogs. On top of that, $3.9 billion will be paid to row crop producers, $2.1 billion for specialty crop farmers, and $500 million for other crops.

According to the statement, producers will receive a single payment determined using two calculations which includes price losses that occurred Jan. 1-April 15, (producers will be compensated for 85% of price losses during this time period) and expected losses from April 15 through the next two quarters (which will cover 30% of expected losses).

The payment limit is $125,000 per commodity, with an overall limit of $250,000 per producer or entity. Qualified commodities must have experienced a 5% price decrease between January and April.

In addition to this, the United States Department of Agriculture will also be spending $3 billion in purchases of agriculture products, including meat, dairy and produce to support producers and provide food to those in need. The USDA will work with local and regional food distributors, to provide food to food banks, as well as community and faith-based organizations.


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