A year of pandemic disruptions has challenged the ag sector, but for farmers the tough times have been underway for years. However, farm resiliency is paying off.
The U.S. ag industry is showing signs of recovery.
According to Nathan Kauffman with the Kansas City Federal Reserve, “It’s still not to suggest that the outlook is necessarily positive, but, six months ago, some of the conditions were rather concerning in agriculture, especially as we looked to April and May, or really the second quarter of this year.”
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“We know that the restrictions and shutdowns that took place early on had a tremendous impact on our economy,” he states. “Supply chain disruption... and then the shift from restaurants to grocery stores... and then the exports and the value of the dollar as a fourth component.”
Travel restrictions jolted the ethanol sector, but as industries adjusted, production is almost back to normal.
“Ethanol has returned to about 95 percent of its pre-pandemic level here most recently, keeping in mind that we were off by about 50 percent during the month of April,” he notes. “That’s the first that I would highlight, that travel has picked back up.”
Also, beef came back after some COVID setbacks: “Many of our meatpacking plants are operating at near their pre-pandemic levels... and so the bottlenecks that had emerged in the early months that were weighing heavily on our livestock markets are also considerably better.”
There are still concerns a second wave of cases could cause another round of disruptions in ag, but a new vaccine and robust export sales is good news for farmers
