Farm Credit associations across the country support farmers, ranchers and rural communities in good times and bad, and the COVID-19 crisis is no exception.
The novel coronavirus compounded an already challenging time for agriculture. Low commodity prices, trade wars and frequent extreme weather events have kept farmers and ranchers scraping by for several years. Understanding these underlying issues, Farm Credit lenders intensified their focus on working with individual customers to help in these unprecedented times.
A global crisis felt locally
News reports remind us daily of the immeasurable impact of the COVID-19 pandemic on agriculture. In cities and towns across America, people are out of work, increasingly food insecure and without many options. And the food supply chain? Stretched and strained beyond any point imaginable.
Farmers across the industry face challenges
While all farmers are struggling, dairy producers have felt the impact acutely. Again, coming off five or more very challenging years, the loss of sales to restaurants and schools created even more problems. While plenty of production exists on farms from coast to coast, the processing plants that fill the typical grocery store-sized containers cannot keep up with demand. This has caused farmers to dump milk while consumers have limits on purchases or see empty coolers at the stores.
The situation has been similar for produce growers. While they may have ample food in the fields ready for harvest, due to social distancing recommendations to keep employees safe, there simply aren’t enough hands to harvest all the produce all before it rots. The result? Some farmers feel they have no other option but to plow under fields and fields of once-edible, but now disintegrating, fruits and vegetables.
Livestock producers face perhaps an even more challenging decision. With nowhere to take their market-ready animals as meat packing plants both close and decrease production due to the spread of the virus, some livestock producers are faced with the challenging decision to ethically euthanize their animals.
Consumers, on the other hand, are stuck at home with nowhere to go, which means that their need for ethanol to fuel their vehicles has plummeted. This sudden change has hit farmers in the Grain Belt hardest, as already-low commodity prices are driven even lower. Meanwhile, nursery crop producers were just gearing up for the spring planting season when COVID-19 hit, leaving them with a season’s worth of plants and no one to buy them.
Fuel to the fire
This laundry list of challenges come at a time when many farmers have already been struggling to make ends meet. Always looking for ways to stay on the farm regardless of the pressure it may put on their finances, many producers had grown dependent on off-farm income to sustain their families and their ag businesses. Those jobs also provide healthcare for many families. However, as unemployment rises in the face of the pandemic, those benefits and income have become less secure, if not nonexistent, compounding farmers’ already challenging circumstances.
Farm Credit associations support their customers via flexibility
Whether you milk cows, grow cabbages, raise cattle, harvest corn or grow nursery crops, farmers across the agriculture sector are hurting. And Farm Credit institutions have done what we always do. In the face of great challenge, we have stepped up, working day and night to do everything we can to support customers through this unprecedented time.
First and foremost, Farm Credit associations have continued to meet farmers’ and ranchers’ financing needs despite work-from home mandates and the social distancing practices put in place to protect the health and safety of both customers and employees.
Understanding the vitality of flexibility amid the chaos, Farm Credit associations have implemented emergency measures for their customers such as interest-only payment agreements, payment deferrals and loan restructuring.
If there has ever been an instance when widespread support from Farm Credit is crucial, that time is now. And we’re here, we’ve been here, and we will continue to be here, prepared and ready to help.
This is the first blog post in the series, “Farm Credit COVID-19 Response.” Read on for information highlighting Farm Credit’s efforts to help our customers access federal emergency funds.