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Pandemic is reminder of essential nature of ag, supply chain

Article cover photo
Secretary of Agriculture Sonny Perdue delivers a message to farmers during the 2020 Commodity Classic in San Antonio. During a teleconference this week Perdue said farmers continue to feed the nation in the midst of the COVID-19 pandemic. (Photo: Joseph L

By Bethany Baratta, ISA senior writer

The global COVID-19 pandemic has clearly brought into focus the critical role those in food and agriculture play in the economy and our nation’s security. U.S. Secretary of Agriculture Sonny Perdue reiterated that message on National Ag Day earlier this week.

“We know that food is essential all year round, but in the face of a pandemic it’s critical that shelves remain stocked and supplies remain plentiful,” Perdue said in a call with ag stakeholders. “That gives people confidence and courage and hope for the future.”

Farmers and those up and down the supply chain have been living the U.S. Department of Agriculture’s (USDA) motto: “Do right and feed everybody”, Perdue said.

“Folks that work the ground and grow the cattle and those that process it and transport it and deliver to retail customers, … you’re the ones that really feed everyone,” Perdue said.

When Iowa Soybean Association (ISA) board treasurer saw the COVID-19 situation becoming serious a few weeks ago, he spent some time thinking about strategy.

“The farm is continuing to operate normal as possible,” said Walton, a grain and livestock farmer from Wilton.

Though the grain and livestock markets have taken a hit due to the pandemic and other factors, Walton said he feels comfortable with his plan.

“We’re feeding cattle slower to market later and hopefully get past the worst of this,” he said.

The bulk of his 2019 and 2020 crops have been hedged, providing protection from most of the market downturns.

Perdue acknowledged that the food supply chain is coming together in innovative ways to serve its customers. The Baylor Collaborative on Hunger and Poverty, McLane Global and PepsiCo this week began its distribution of nearly 1 million meals to students in rural areas. This came as the result of flexibilities announced by the USDA to allow meal service during school closures to minimize potential exposure to the coronavirus. During an unexpected school closure, schools can leverage their participation in one of USDA’s summer meal programs to provide meals at no cost to students, according to Perdue.

Late last week the U.S. Department of Homeland Security  the food and agriculture sector was classified as one of 16 essential critical infrastructure workers amid COVID-19. This designation allows working in these critical sectors to continue working during periods of community restriction, access management, social distancing, or closure orders/directives.

“The designation of the food and ag sector as essential was a statement of the obvious, but it does mean that we won’t be impeded from doing business,” Walton said.

Perdue said that President Donald Trump’s closure of the Canada and Mexico border to nonessential travel and trade should not impact ag workers since the sector was identified essential.

Markets

Perdue said there’s progress being made to expand exports to China after the signing of the Phase 1 agreement. He said China is expanding its list of beef and pork products eligible to enter its ports.

“Things are moving along well with China in spite of this COVID-19,” Perdue said. China’s demand for feed and food-grade products is accelerating; China purchased 756,000 tons of corn last week, China’s largest purchase since 2016, he said. China also purchased 340,000 tons of wheat.

“That’s good news and a bright future for our ag producers,” he said. “We think prices should respond to that when we get through this outbreak.”

The Iowa Cattlemen’s Association has expressed its concerns regarding several issues heightened by the COVID-19 pandemic, including the price spread between boxed beef and fed cattle prices.

Perdue said the USDA is actively monitoring all ag commodity markets and the flow of food from the farm to the table during this COVID-19 pandemic.

“We’ve seen some concerns in our cattle markets and we’re paying special attention in the difference in prices from the farm gate to the grocery shelf to make sure people along the food supply chain are not taking advantage of the situation with hyper margins that we haven’t seen before,” he said. “We expect all producers and stakeholders to be …  hardworking patriotic honest brokers to really do right and feed everyone while we weather this pandemic together.”

Next steps

The business disruptions associated with the ongoing COVID-19 pandemic has affected the Walton family personally. Walton’s wife, Paula, is Coowner and operator of a salon in Wilton. In an effort to slow the spread of COVID-19, salons were shut down.

Walton hopes planting season can run as normal as possible this year. He’s heard from equipment and parts dealers regarding business continuity during this time. Sales and service personnel are still available by phone or, if necessary, at the farm—following the recommended social distancing measures.

“We hope this passes soon and we can all get back to our sense of normal,” Walton said.

Contact Bethany Baratta at bbaratta@iasoybeans.com.

For media inquiries, permission to republish articles or to request high-res photos, please contact Katie James, ISA Public Relations Manager at kjames@iasoybeans.com. © 2020 Iowa Soybean Association. All rights reserved.