“Mystery Seeds.” The first thing that came to mind was a possible title for a “Scooby-Doo” episode. Just when you thought 2020 couldn’t get any stranger, people in at least 10 states have received packages with a Chinese postmark and a label that says some kind of jewelry is inside. However, it’s a different story after they open the box.
What these Americans are receiving is an unsolicited package of seeds. States like Minnesota, Louisiana, Utah, Virginia, Kentucky, Washington state, and others are reporting similar situations. One thing to get out of the way right away is that under no circumstances should anyone plant those seeds.
One example of mystery seeds that were sent to a Minnesotan recently. (Photo from the Minnesota Department of Ag)
“We’re uncertain what those seeds may be and why people are receiving packages they didn’t send for,” says Denise Thiede, Seed Unit Supervisor with the Minnesota Department of Agriculture. “Until we know more, we’re encouraging people to contact us because of the risk those seeds may pose to Minnesota agriculture and our natural landscapes.”
Washington state just recorded its first known case of an unsolicited seed shipment late last week. I talked with Karla Salp, the Public Engagement Specialist with the Washington State Department of Agriculture. Not one but two Washington residents picked up seeds in the mail they didn’t order from China.
“One of those residents sent us a picture of the seeds so we could see what they were talking about,” Salp says. “We thought they looked a lot like some kind of citrus seeds, while the labels said the packages contained some sort of jewelry.
More “Mystery Seeds” from China. (Photo from the Minnesota Department of Agriculture)
“Initially, we had been telling folks who received the seeds to report it to USDA,” she said. “They handle reports of agricultural smuggling. “The social media post advising people to contact USDA has been seen by over 30 million people. We’re sure that USDA knows all about the problem now.”
So, the Washington Ag Department is asking their residents to put the seeds in a Ziploc bag and put them in their regular trash. Do not putt them in something like a compost pile. “Most of the packages have another package within them,” Salp says. “The seeds are often in a second package inside the shipping container. Residents need to leave the seeds inside the sealed container. Do not open them up, and definitely do not plant them.”
Each state will have its own directions for residents who receive the seeds through the mail. The Minnesota Ag Department says don’t throw away the package or its contents and do not plant the seeds,. After that, contact the Arrest the Pest line at 888-545-6684. They’ll need your name, contact info, and the date you received the package.
Minnesota officials will then coordinate shipping the package and its contents to the MDA Seed Program. The MDA is currently working with the USDA’s Smuggling Interdiction and Trade Compliance Program on identifying and destroying the seeds.
Salp says putting unknown seeds in U.S. soil could be problematic.
“It could be a combination of any of those three reasons I just listed,” she added. “It could be an invasive species that also carries a specific plant disease. These are some of the serious reasons that things like this need to go through the proper channels at the border if they’re a plant-based product.”
The USDA is working with federal and state agencies to investigate these unsolicited packages.
“We are also working with various online retailers to address some of these issues as well,” Salp said.
Farm stress. There’s far too much of it going on these days. What a way to make a living as the farming economy has been in the dumper for over half a decade and it’s getting worse, just as we were beginning to see a tiny light at the end of a still very dark, very long tunnel. This COVID-19 outbreak and its effects on the economy are only making things more difficult.
The assignment from the National Association of Farm Broadcasting (I work there as Assistant News Service Editor) was to find an expert who could give farmers tips on how to handle the enormous stress they were carrying after the trade war with China, numerous weather disasters, as well as commodity prices so low that farmers could no longer cover their cost of production.
Thanks to a Google search, I found out that Dr. Josie Rudolphi of the University of Illinois was just the expert to help farmers deal with everything that’s happening. She’s an Assistant Professor in the Agricultural and Biological Engineering Department at the campus in Champaign, Illinois. Rudolphi has developed the HERD Stress Management Strategy and spends a lot of time speaking about it throughout rural America.
“Producers are experiencing more farm stress than we’ve seen over the previous five years, which no one thought was possible,” she said. “We’re getting further into spring, which is already a stressful period, and now we’re compounding that with COVID-19, which is a double-edged sword.
“Not only does it create health concerns,” Rudolphi added, “it also creates big concerns about what we see happening in the markets right now. Traditional markets aren’t available for a lot of their products right now, so people have to find a non-traditional way to move some of their products, or they have to dispose of them entirely. That’s an enormous stressor, so it’s a really challenging spring.”
Here’s some highlights of a breakout session that Dr. Rudolphi gave on stress management at the 2019 National Farm and Ranch Conference.
HERD Stress Management
HERD is an acronym that describes what she calls “positive ways of coping with stress.” She tried to keep it as general as possible just because people experience and handle stress in different ways. The goal of the strategy is to keep people as healthy as possible through a stressful period.
HERD stands for Hobbies, Exercise, Relaxation, and Diversion. Rudolphi calls them “evidence-based ways of positively coping with stress,” with positively being the key word in the sentence.
Hobbies – “There’s a lot of scientific evidence that doing something purely for pleasure, even two hours a week, can have a tremendous impact on mental health,” she said. “What separates a hobby from a job is it’s a creative outlet. We’re talking about things like art, gardening, and woodworking.
“We do know woodworking is a big one on a lot of farms across America,” Dr. Rudolphi said. “So is working with metal, as well as restoring old farm equipment. Hobbies are something different from our jobs and something we want to do for ourselves. It’s a great way to shift yourself out of a stressful mindset, so find something to do that you truly enjoy.”
Exercise – “We all know exercise is good for us,” Rudolphi said. “Exercise has huge physical benefits, but it also has tremendous mental benefits as well. And you only need to do a minimum of 20 minutes a day, it doesn’t have to be arduous or intense. It just means getting your heart rate above resting. A brisk walk is certainly a way to start reaping some of the physical and mental benefits.
Relaxation – “It might be a no-brainer to some, but this is all about finding ways to decompress,” she said. “You know how life on the farm can be. It’s challenging and there’s always something to do and be worrying about.
“it could be something as simple as a nap,” Rudolphi said. “It’s often hard to find the time or even the justification for a quick nap. Getting the rest and relaxation that we need is a vital piece of maintaining our physical and mental health.”
Diversion – “It’s always fun to talk about diversions,” she said with a smile I could almost see over the phone. “It’s a way of distracting your brain and stopping something like negative self-talk or possibly a thought spiral.
“For example, if you find yourself getting really overwhelmed thinking about things like farm finances, farm succession planning, I always recommend you take 20 minutes and do something else. Change the task in front of you by maybe taking a drive to another farm for a visit. It could be a 20-minute YouTube video about something purely for entertainment or a laugh. It’s trying to divert our attention away from something bringing a tremendous amount of stress.”
Signs of serious farm stress
There are signs of extreme stress (what she calls “distress” that friends and family should be watching out for. You want to watch for physical, behavioral, and emotional changes in your friend or family member out on a farm.
“Watching out for signs is very important because we often have trouble admitting to ourselves that we’ve changed, especially if it’s not a positive change,” she said. “It’s easier to observe changes in others and bring it up to them if that should become necessary.”
Physical – “Are they sleeping a lot more,” Rudolphi said, “or have they gone the other way and don’t sleep much at all? Are they eating a lot more or a lot less? Are they experiencing some kind of chronic pain, such as a backache or headache? Is their heart racing or are they experiencing nausea?
Behavioral – “These are changes in our day-to-day patterns,” she said. “The changes could be in how much we eat, drink, or sleep. Changes could show up in what we’re interested in. They could also include work changes, especially if someone starts neglecting the things they’re supposed to do. Distressed people also could manifest changes how they care for themselves.”
Emotional – “These are the easiest changes to spot,” Rudolphi said. “Depression shows up as people not interested in the things they used to enjoy. They could also become easily agitated, irritable, or angry. A blowup at a family member is an obvious sign that there’s too much stress.”
Stress Management Resources
She says there are several national and regional stress lines that farmers can call to talk to someone about what’s happening on their farm. Iowa has the Iowa Concerned Hotline. Minnesota has several farm hotlines that producers can access. But, there’s nothing wrong with looking for professional help if you feel it’s gone that far.
“A really good place to start toward achieving that objective is to talk to your primary care provider,” she says. “They’ll be able to help you triage the situation and help you navigate the resources available in your insurance system.”
Farmers are known as independent folks who prefer to handle things themselves. Rudolphi says it’s vital to remember that asking for help does not make you weak or mean something is seriously wrong with you.
“No,” she said emphatically. “Absolutely not. If you have livestock and something is wrong with them, you wouldn’t hesitate to ask for help. Give yourself that same level of care, for both your sake and for the people around you.”
Here is the audio podcast with Ryan Martin that you can download to your computer. You can also play it on your mobile device. Just his the play arrow on the left.
Frost in the forecast is rarely a good thing in farm country during any season outside of winter. In an ideal world, the only exception is a killing frost after corn states hit black layer. Of course, we don’t always live in an ideal world, do we? Ryan Martin of Warsaw, Indiana, is a long-time agricultural meteorologist who says the threat of some frost damage will begin this weekend.
“The days most in question are Friday night, May 8, into Saturday morning,” he said. “The axis of the coldest air will come across eastern Minnesota, Wisconsin, east-to-northeast Iowa, northern Illinois, most of Indiana, as well as all of Michigan and Ohio. This is the zone where we’ll see temperatures at 30 degrees or colder.”
He said the coldest air looks to hit Michigan and Ohio this weekend, where we could see some big impact on soft red winter wheat, especially in Ohio. The frost timing is not good as wheat has woken up out of winter dormancy and is moving forward through its growth stages.
“The wheat is at the jointing stage and anytime the crop gets further into its growth, that means the wheat is a little more susceptible to cold temperatures,” Martin said, “depending on how much the temps fall and how long they’re under a certain threshold.
“If wheat is just breaking dormancy and you get a cold snap, you have to be under 28 degrees anywhere between three and five hours,” he added. “When we get into the jointing stage and further along, wheat can barely handle 30 degrees for an hour or two. That’s where the issue lies on wheat this weekend.”
Ryan Martin, Hoosier Ag Today meteorologist, says the fast pace of planting in 2020 is going to slow down for a few days due to cooler than normal temps in farm country. (Photo YouTube.com)
Corn and soybeans will hopefully be a different story. Based on the crop planting progress and emergence reports, Martin, Chief Meteorologist for the Hoosier Ag Today Radio Network, is much more optimistic about those crops being able to survive the freezing temps.
“Illinois leads the way with nine percent of its corn crop emerged,” he said. “In most areas, the growing point of the crop is still going to be below ground, so I don’t think it will mean anything for corn and soybeans on mortality. What it does do is slow down that incredibly fast-paced planting season we’ve seen in many states.”
A couple of other examples include Iowa, which was on a record planting pace during the last planting update, while Minnesota just to the north is no slouch either on planting progress. The Purdue University meteorology graduate says all of the “good stuff” that comes with early-planted corn gets slowed down and “stunted” because of the frost/freeze over the weekend and the extended run of below-normal temps that won’t end till the middle of next week.
“Cold air moved out of Canada and focused on the Great Lakes, Upper Midwest, and the northeastern United States,” Martin said. “However, there’s an interesting twist ahead in the forecast for the next seven-to-ten days. We’ll start to see temperatures in the below-normal areas start to moderate on May 13 through 15.
“Things will take a drastic switch after that,” he added. “We’ll see above-normal temps in the Eastern Corn Belt, while the Plains may drop down below normal through the last part of May. There’s a lot of air currents, different movements here, different patterns trying to emerge, and it all has to do with where polar air is shifting to this time of year.”
It’s been a bit of an unusual spring so far for many reasons, but I’m just talking about the weather. What we’ve seen so far in terms of temps and precipitation has been very different from recent years. There’s no question, a lot of states have seen temperatures consistently lower than what they normally expect.
“Big swings in spring temps aren’t unusual,” says Martin. “We’ve certainly seen them before. I think the reason it’s coming home to roost a little bit more and has people scratching their heads is the degree of change from the last several years.
“We’ve had pretty dog-gone decent springs over the past handful of years,” he recalled. “We’ve come out of winter early and been able to hit the ground running based on the temps. Last year, precipitation was a big problem, but the temperatures were still decent. This year is the first out of the past five or so that’s really showed us the kind of variability we can see in the spring.”
Ryan will do custom forecasts for your radio and TV stations. Check out his work at www.weatherstud.com.
Bison ranching. The first thing that may come to mind is hundreds of Bison thundering down the prairie a long time ago. Did you know we raise bison on farms across the country? In fact, the U.S. has bison production in every state in the union. While it’s been a growing industry for many years, the impact of COVID-19 on raising Bison has been anything but positive.
“We’re a small segment of agriculture,” says Dave Carter, the Executive Director of the National Bison Association. “However, we’ve been growing for the last 15 years and turning into a strong and steady business. Most producers have been pretty profitable over that stretch.”
Here’s an interesting conversation about raising bison in the United States. It’s from a YouTube channel called Off-Farm Income
Bison is marketed in two locations, similar to the other major protein segments in U.S. agriculture. Those markets include the restaurant/foodservice sector and the retail sector. Carter said because bison processors tend to be smaller than their counterparts that process beef and pork, they often specialize in one market or the other.
“When COVID-19 hit and restaurants shut down, those processors serving the foodservice customers really took a hit,” he said. “Some have had to lay off up to 60 percent of their employees almost overnight. Those folks who saw restaurants shut down were suddenly scrambling and trying to adapt as retail demand went up.
Dave Carter is the Executive Director of the National Bison Association. (Photo from the Business Journals)
“Herein lies the problem,” Carter added. “Most of the higher-end cuts like steaks go into the restaurant and foodservice sector. On the retail side, customers are going into stores to buy ground bison. When the higher-end cuts like tenderloins at $24 a pound aren’t selling while people are buying ground bison at $9 a pound, it has a significant financial impact.”
The prices that processors have paid to ranchers over the past month have dropped around 40 cents a pound, a significant price cut for a large animal like bison. Prices have been around $3.70 a pound. He admits while other livestock sectors would love to see that price, it’s still a significant drop for bison producers in just one month’s time.
The ranchers in the finishing segment of the bison industry are the ones being hit hardest because they’ve got animals that are ready to go and are having to hold onto them longer. Processors aren’t working as quickly as they normally would due to layoffs and illness. Animals that stay longer on the farm tend to gain more weight than is optimum and it adds more expense to the bottom line.
One of the biggest challenges the industry faces is getting enough feed because of what’s going on in the ethanol industry. “Distiller’s grains have been a big part of our feeding formula in bison ranching,” Carter said. “Because of the crisis in the ethanol industry, the price of distiller’s grains is going up significantly and the availability is going down.
Bison ranching has been growing in the U.S. for 15 years. However, prices have dropped 40 cents over the last month because of COVID-19. (Photo from grist.org)
“That means we now have ranchers who will get less for their animals when they deliver them to their processor,” he added, “but their feed costs are going up at the same time.”
He is thankful that none of the bison processing plants in the country have had to shut down entirely because of the outbreak. Unfortunately, a high number of workers have tested positive for COVID-19 and that’s made other employees hesitant to come to work. But Carter says those bison processors are doing a “great job” of caring for their workers through social distancing, through testing, and by providing Personal Protective Equipment,
Livestock producers in the pork sector have had to make the horrible decision to euthanize some of their animals as they don’t have anywhere to send their hogs for processing. Carter says the bison industry isn’t at the point yet.
“We still have enough supply chain capacity that our ranchers haven’t had to make that decision,” he said. “One reason for that is, unlike our friends in the cattle industry, we don’t have fall calving. Most of our calves are born between April and June, which meant they were weaned and already sent to other ranchers for finishing between November and February of last year.
“That means producers were already done selling their previous calf crop before COVID-19 showed up,” Carter added. “A lot of the ranchers that are feeding bison will probably turn some of their animals back out to pasture and let them graze on grass, so they don’t have the extra feed expense. We can hold them longer than a lot of other livestock, so we aren’t in danger of having to euthanize them in the near future.”
Farmer optimism is in the dumper and there is no nice way to say it. COVID-19 and its economic impact, low commodity prices, trade wars, and weather have made life even more challenging. DTN found out that farmer optimism is at a record low. They’ve been doing a tri-annual survey of farmers for several years and this spring’s Agricultural Confidence Index hit an all-time low mark.
DTN Editor-in-Chief Greg Horstmeier says farmers optimism hit an all-time low in their triannual Agriculture Confidence Index. (Photo from rushvillerepublican.com)
The baseline for their survey is 100. Everything below 100 is pessimistic, and any number above 100 is considered optimistic.
“We do our survey in the spring, just before planting,” said DTN Editor-In-Chief Greg Horstmeier. “We also do one at harvest, and then our final survey is in December, which is basically farm tax time. The drop in the index from the last time we did this in December is not a surprise, given everything that’s going on.
“It was a record-sized drop down to an index reading of 67,” he added. “That’s a 97-point drop, which is even more remarkable because we’re hearing that agriculture is moving on as normal. Everyone is either getting ready to or heading out into the field, so that big of a damper on the survey results is surprising.”
Horstmeier said spring is typically the most optimistic time of the year for farmers. New crops are going into the ground, which automatically means a fresh start, especially if the year before was as tough as 2019. Low optimism in the spring isn’t unusual. What’s unusual about this survey is how pessimistic farmers are about the future outlook.
The future outlook is typically very optimistic during the spring survey. “This year, that index reading was 73, which means it dove hard into negative territory,” Horstmeier said. “That was the big takeaway for me. Not only does the current situation have farmers in a pessimistic state of mind, but they don’t have a lot of promise for the foreseeable future.”
Another thing that really stood out was just how prevalent the pessimism is in different sectors of agriculture. It didn’t matter what farmers grew or how big their operations were, either. Even in down years, there’s typically difference worth noting.
“We typically see at least some differences between, for example, livestock and crop producers,” Horstmeier said. “We’ve also seen regional differences, such as the Midwest may be less optimistic than farmers in the Southeast. The pessimism was across the board, regardless of location, income level, the crops they grew, and what kind of enterprises they had.”
Speaking of Midwest farmers, in this year’s survey they showed the most pessimism currently, yet they also had the most optimism for the future. Southeastern farmers were more optimistic about their current conditions (89) but felt less optimism for their future (56).
DTN also conducts a similar survey of agribusinesses. The index level came in at a just-above-neutral 104. Agribusinesses rated their current conditions at a slightly pessimistic 85. However, they were above neutral when looking at the future, coming in at 118.
Farm safety net programs saw a record signup this go-around.
Producers signed a record 1.77 million contracts for the U.S. Department of Agriculture’s Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) programs for the 2019 crop year, which is more than 107 percent of the total farm safety net contracts signed compared with a 5-year average. USDA also reminds producers that June 30 is the deadline to enroll in ARC and PLC for the 2020 crop year.
2019 farm safety net program signups set a record. With the trade wars, weather problems, and prices in the dumper, is anyone surprised by that? (Photo from agweb.com)
“Producers for several years have experienced low commodity prices, a volatile trade environment and catastrophic natural disasters,” said Richard Fordyce, Administrator of USDA’s Farm Service Agency (FSA). “Farmers looking to mitigate these risks recognize that ARC and PLC provide the financial protections they need to weather substantial drops in crop prices or revenues.”
Producers interested in enrolling for farm safety net programs in 2020 should contact their FSA county office. Producers must enroll by June 30 and make their one-time update to PLC payment yields by September 30.
FSA attributes the significant participation in the 2019 crop year ARC and PLC programs to increased producer interest in the programs under the 2018 Farm Bill and to an increase in eligible farms because of the selling and buying of farms and new opportunities for beginning farmers and military veterans with farms having 10 or fewer base acres. Enrollment for 2019 ended March 16.
USDA Service Centers, including FSA county offices, are open for business by phone only, and field work will continue with appropriate social distancing. While program delivery staff will continue to come into the office, they will be working with producers by phone and using online tools whenever possible. All Service Center visitors wishing to conduct business with the FSA, Natural Resources Conservation Service or any other Service Center agency are required to call their Service Center to schedule a phone appointment. More information can be found at farmers.gov/coronavirus.
Farm debt levels are piling up and it’s getting scarier. Here’s a friendly reminder that the period available for working through some debt challenges has been extended.
The Minnesota Department of Agriculture (MDA) is reminding Minnesota farmers and agricultural lending institutions that the state legislature extended the length of mediation available for farmers in the Farmer-Lender Mediation Program from 90 to 150 days. Minnesota farmers that are in debt can renegotiate, restructure, or resolve farm debt through mandatory Farmer-Lender Mediation. Mandatory mediation means that creditors cannot start a proceeding to collect a farm debt against agricultural property until an offer of mediation has been extended and, if the farmer so chooses, completed.
“I want to make sure that farmers and their ag lending institutions know that the mediation period was extended by 60 days to 150 days,” said Minnesota Agriculture Commissioner Thom Petersen. “This is a critical program for farmers – especially now when COVID-19 has caused the closing of agricultural markets. Having sixty more days to renegotiate or restructure debt will be a huge help in many cases.”
Spring weather is never a dull topic of conversation in the Midwest, is it? We went from a fantastic week of mild weather leading up to Easter to a run of below-normal temps and snowfall on Easter Sunday. While it was only a couple inches here in Maple Grove, there were much higher amounts elsewhere. I talked weather with Bryce Anderson of DTN, who says it’s not unusual at all to get snow during April.
“That has certainly happened many times before,” he said. “The heavy snow was certainly unwelcome because it set back farmer fieldwork for a while, probably a week later than they wanted.
This is what spring weather looked like in a good deal of the Central Plains and Midwest when flooding hit farmers hard. The good news in the spring weather forecast this year is the threat of flooding has moderated, depending on where you live. (Photo from curbed.com)
Farmers are certainly chomping at the bit to get spring fieldwork done to get ready for planting. Remember April 15th of 2019 and the big snowstorm that moved through the Midwest? Here on the west side of the Twin Cities, we picked up 17 inches of snow last year. Happy Tax Day, right? However, despite that recent round of spring weather, Anderson doesn’t expect the monumental planting delays we saw last year during one of the roughest springs in recent memory.
Here’s a quick recap of a rough spring in 2019, courtesy of PBS:
“It won’t be a repeat of last year by any means,” he said emphatically. “Despite storm activity that moved through the southwestern and central United States, things were starting to moderate as we headed into the weekend. That colder arctic air we saw come into the Midwest over Easter was very slow in leaving the region, so that’ll also set fieldwork back a bit.”
One area of good news in the spring weather forecast is he’s not as worried about widespread flooding in farm country as he was a month ago. However, the caveat is that it depends on where you live. Still, things have slowed down some on that front.
“It’s not just me saying that either,” Anderson said. “Hydrologists with the Corps of Engineers have said the movement of the higher water throughout the nation’s river systems has been better than they hoped it would be. However, that doesn’t mean we won’t have trouble spots.
“The James River Valley that runs through South Dakota and the Red River Valley in North Dakota and Minnesota are still at flood stage,” he said. “In the Delta, there are streams in some portions of the lower Mississippi River Valley where flooding is still ongoing.”
Unfortunately for farmers and folks in those areas, flooding will likely continue in those areas for some time yet. Anderson did say that there likely aren’t going to be any new flood threats that develop in the spring weather forecast for farm country unless there’s a drastic change in the weather pattern. Before the recent run of cold and snow, farmers have gotten some planting done this spring in the eastern Corn Belt.
“There has been some soybean planting in Illinois and Indiana,” he said. “Growers in the western Corn Belt likely haven’t gotten very busy yet. In other areas of the Delta, corn planting is way behind in states like Mississippi and Arkansas. They likely won’t get a lot done after the recent run of storms and rainfall that recently hit southern areas.
COVID-19 has put a serious crimp in the U.S. economy and nowhere is that more evident than in agriculture. More specifically, American hog farmers are struggling to stay on farms because they’re having trouble getting their hogs to market. Big trouble, in fact. Hogs are so far backed up on the farm that producers may have a tough decision to make in the not-too-distant future.
Those of us in the agricultural media don’t often hear the word “euthanize” in press conferences. Unfortunately, it came up multiple times during a press conference hosted by the National Pork Producers Council. As prices for hogs have plummeted, Howard ‘A.V.’ Roth, NPPC President, says things are as bad as they’ve ever been after several years of a depressed farm economy.
Hog farmers are hurting and the “other white meat industry” could be in trouble. COVID-19 has only accelerated a price decline that began almost two years ago during the U.S.-China trade war. Pork farmers are reaching out and asking for help. (Photo from the duluthnewstribune.com)
“We are now an ag sector in dire crisis,” Roth said to reporters. “Farmers are already exiting the business and the damage will only intensify without direct intervention from the federal government.”
Speaking as a hog producer himself, Roth says the pork industry has a list of several things it needs in order to help keep as many farmers in operation as possible. The first item on their wish list would clear out a tremendous amount of stored pork supplies as quickly as possible, plus it would get food into the hands of people who need it.
“Over $1 billion in pork purchases by USDA to clear out a backed-up meat supply, while supplementing food bank programs around the country facing increased demand for food as unemployment continues to rise,” Roth said. “These purchases should come from packaged pork that was intended for restaurants and other segments of the foodservice market.”
In all the years I’ve covered agriculture, I can tell you from firsthand experience that farmers want to make their living from the markets, not government handouts. How desperate are pork farmers to stay in business?
“We need direct payments to producers without eligibility restrictions,” Roth says.
They’re also hoping to see China remove retaliatory tariffs on U.S. pork that are still in place despite the Phase One trade agreement between the two countries. Roth points out that it’s no secret China needs a reliable source of affordable pork after their herds were decimated by the African Swine Fever virus.
“Removing those damaging tariffs would get us back on a level playing field with our international competitors,” Roth says. “Dr. Dermot Hayes, an economist with Iowa State University, says removing those tariffs would allow U.S. exports to China to more than double their current volume.”
How badly does China need pork, one of the most preferred proteins in the Asian diet? Let’s just say that Chinese pork producers, who can’t ever hope to meet their country’s domestic demand, are enjoying some pretty high prices for their products right now.
“While Chinese producers are enjoying record pork values, U.S. producers are facing a dire decision on our farms,” Roth said. “Sadly, it’s true. Without significant assistance, euthanizing is a question that’s going to begin coming up on our farms.
“Let me be the first to say, as a pork producer, we care about our animals,” he added. “The last thing we ever want to do is euthanize even one animal. We’re going to do everything in our power to make sure that doesn’t happen.”
Producers may be able to at least push that decision back somewhat, thanks to a recent decision by the Environmental Protection Agency. Michael Formica, Assistant Vice President of Domestic Affairs and Counsel at NPPC, says hog housing restrictions have been temporarily relaxed.
“We reached out to EPA to ensure that if we were ever in a situation like the one we face now, producers would have an option to hold animals on their farm,” Formica said. “All of the farms are permitted to hold a certain number of animals. If they exceed those numbers, they have to go through new permitting.
“We asked EPA for a temporary waiver of the thresholds during the crisis we’re facing,” Formica said, “and thankfully, they granted that request a couple of weeks ago. That’s a tool that many farmers can use to hold animals on their farms while additional animals come through the pipeline.”
He says it’s important to point out that’s an advantage for farmers only if they have adequate additional space. If the backup continues indefinitely, they will run out of space and that’s when they have to start culling otherwise healthy animals from their herds, simply because there won’t be enough space to take care of them.
Why is it all piling up on hog farmers so quickly? Nick Giordano, Vice President of Global Government Affairs and Counsel for NPPC, says hog producers were the first to be hit hard by the trade war with China.
“Hog farmers were there at the tip of the Chinese retaliation spear,” he said. “Trade retaliation from two key markets, Mexico and China, in 2018 and 2019, took $20 off the prices that producers received for every hog.
‘Unlike a lot of the other segments in our economy that came into the COVID-19 outbreak with record profits and a full head of steam, our producers were already hurting. This has made a bad financial situation infinitely worse.”
How far have things fallen across the industry? Iowa State’s Dr. Hayes says in just one month, from March 10 to April 10, the pork industry has lost $5 billion in value. Something has to change.
Here’s the complete conversation with Arlan Suderman of INTL FCStone on the commodity markets reaction to the coronavirus outbreak.
Coronavirus headlines and the commodity markets. It’s been a while since we’ve seen the commodity markets this reactive to news headlines on an almost daily basis. While it’s not unheard of, one commodity expert says it’s been over a decade since the markets have been hit this hard by the news. Arlan Suderman is the Chief Commodities Analyst for INTL FCStone, talks about why the news coronavirus headlines seem to be playing havoc in the commodity markets.
“I think that’s a question a lot of people have these days,” Suderman says. “It’s a valid point to discuss.
Arlan Suderman, Chief Commodities Analyst at INTL FCStone says the commodity markets have been hit hard by news reports surrounding the coronavirus, as well as the resulting “fear outbreak” from people all over the world.
“I was initially downplaying the market reaction in January,” he recalled, “before doing some research at the end of that month. This is the type of virus that’s going to trigger a lot of fear in people. When you have that much fear, the fear of the coronavirus headlines will be worse than the threat of the virus itself.”
He points out that when people get afraid, they stay home, they don’t travel, and they don’t go out in public as much. That’s been the case in China as everywhere the disease has hotspot outbreaks, everybody stays home.
“Shanghai, a city of millions of people, is now a ghost town,” Suderman said. “Now we’re seeing pictures of that in lots of other places, including Italy.
“When people stay home and don’t go out, they tend to consume
less food,” he added. “That includes consuming less meat and a lot more
starches. Overall, it does tend to change consumption patterns a lot.”
People also consume less energy in these situations as they aren’t driving a lot while airlines are also canceling flights as people don’t want to travel. Less consumption in the energy markets hurts the biofuels markets as well.
Even things like shipping commodities get much more complicated as people are staying home, thanks to the coronavirus headlines. That’s been the case in China and is becoming prevalent in other countries too.
“People didn’t show up to work,” he said. “Ports become
congested, ships don’t get unloaded, and shipping slows way down. That’s lost
demand you likely don’t get back. You may get some of it back, but not all.
