“The farmer has to be an optimist, or he wouldn’t still be a farmer.”

– Will Rogers

2020 has offered a perfect storm of misfortune for Indiana’s agricultural producers.

Our farmers faced massive obstacles like climate change and foreign affairs for years before January rolled around. Then, our producers held hope that a trade dispute beginning in 2018 between the U.S. and China would end soon. Over the last two years, President Trump’s war on Chinese tariffs effectively stalled free trade and made a deep impact on Indiana-grown exports.

To be clear, Indiana produces four crops that are important to China exports, including corn (ethanol), soybeans (biodiesel), wheat, and livestock (food). If just one of those sectors changes or decreases consumption, it can dramatically affect grain and livestock prices.

Within weeks of the new year, President Trump agreed to sign a trade deal that would again allow exportation of goods to China, like soybeans and pork. Farmers across every county in Indiana breathed a sigh of relief. The business of agriculture began to look bright.

The pragmatic outlook of a successful farming year continued for two more months … until Covid19 spread.

When Covid19 made Indiana sick

Because of the past two years of crippling trade wars, farmers had little choice when it came to their farms’ futures. So many were already struggling when the Coronavirus pandemic started to spread. But it soon was evident that the virus had the power to shut farms down by many nefarious means.

The average farmer gets everything they need to run their farms from key suppliers, like equipment and fertilizer dealers. If farmers can rely on those dealers for supplies and parts, their farms will run like clockwork. But once any of those dealers are closed due to the pandemic, farmers could experience major delays in planting and fertilizing crops that already run on a tight schedule and weather perimeters. So, the closure of one county’s fertilizer suppliers could affect an entire county’s harvest at the end of the season.

One Indiana cattle and grain farmer said, “if you're a farmer, and you bought all your inputs from one fertilizer dealer, and they shut down because of Coronavirus during planting season, what are you going to do? You don't have any choice, and you don't have the money that goes somewhere else.”

As a result, corn, wheat, and soybean farmers could have experienced a delayed start in their fields. While seed planting time is vital to the health of the plant and the profitability of the harvest, these spring planting delays made an almost immediate impact on crop pricing.

According to a CNN article, over the first three months of stay at home, “corn futures have declined almost 10 percent, soybean futures more than 4 percent and wheat futures nearly 2 percent in the past several weeks. Futures prices for lean hogs have dropped 12 percent in the past two weeks and prices for cattle have declined nearly 13 percent.”

But even with this bumpy beginning to this pandemic for farmers, there would be many more obstacles in store. Indiana farmers would experience a domino effect of catastrophes stemming from the spreading pandemic.

To stop now or continue moving forward?

Whether a farmer rents or owns their land, they know that if they do not plant crops, they have zero opportunity to make a profit. Many Indiana farmers opted to plant crops on their land in the springtime, only to realize they would need to spend more money to harvest it. Regardless, because 90 percent of all of Indiana’s crops go to feeding livestock, many farmers do not have a choice of whether to plant crops – the animals need to be fed.

But across the rest of the nation, farmers expressed their strife with the pandemic. “In Wisconsin and Ohio, farmers are dumping thousands of gallons of fresh milk into lagoons and manure pits,” according to a New York Times article. “An Idaho farmer has dug huge ditches to bury one million pounds of onions. And in South Florida, a region that supplies much of the Eastern half of the United States with produce, tractors are crisscrossing bean and cabbage fields, plowing perfectly ripe vegetables back into the soil.”

In April, news outlets covered a dairy farmer who dumped thousands of gallons of milk rather than undersell it. He explained that it was a financial decision: to basically ‘pay’ for a pasteurization facility to take it off his hands or dump it down the drain. Some argued that he could have donated the milk, but he decided that the danger of feeding the public non-pasteurized milk as just too high. He ended up losing about $200,000 down the drain that day, but that was probably the best and most financially conservative decision the farmer could make.

In many Indiana counties, farmers face the same decision as the dairy farmer. Will they plow their crops into the ground, or undersell their cattle, or let their field go fallow rather than lose even more money down the line because of the pandemic?

Dave Puglia, an expert from the PBS News Hour brought up a valid perspective, saying, “That farmer has to decide whether to spend the money to harvest it, which is the most expensive part of farming in the produce industry. So, if you already know you are taking on a 100 percent loss, do you want to make it 160 percent by harvesting a product that doesn't have a profitable home?”

Pandemic effects in Indiana’s livestock

The Indiana Meat & Poultry Buyer’s Guide states that 81 official meat processing establishments process about 16 million pounds of meat each year (10 of which sell out-of-state meat), with 39 custom-exempt plants. In 2017, 144,230 heads of livestock were processed.

Two of the nine major U.S. meat processing plants are in Indiana — the Tyson Fresh Meats plant in Logansport and Indiana Packers facility in Delphi. Both of those major plants were closed for weeks in late April and early May because employees tested positive for Coronavirus.

Tyson Fresh Meats and Indiana Packers account for around nine percent of the U.S.’ pork consumption. Each plant processes hundreds, sometimes thousands of animals each day. So, when there is a closure for two weeks, the state’s entire slaughter capacity is diminished, and a backlog of animals begins to build up. The effects of these closures were quickly felt throughout the entire meat food chain, causing the pricing to drop and inventory problems.

During a PBS dialogue about farming during Coronavirus, journalist Stephanie Sy pointed out that “The plant closures may be necessary to ensure worker safety, but they also mean farmers are running out of places to take their livestock.” They did not foresee meat shortages, but grocery stores would begin to offer unfamiliar cuts and types of meat, or meat quantities will not be refilled as quickly.

“There’s no doubt about it; this is an extraordinarily difficult time for the meat processing industries,” said Jayson Lusk, the head of Purdue University’s agricultural economics department. “The real pain is being felt by a lot of livestock producers who, at the moment, don’t have anywhere to go with their animals. The processing plants aren’t buying because they’re not operating because their workers are sick.”

When packing plants opened again after quarantine in mid-May, the grocery prices fell a bit. Slight dips in grocery sales can have a drastic reflection on a farmer’s profit margins. This has always been the case with farmers. In fact, JFK notably said, “The farmer is the only man in our economy who buys everything at retail, sells everything at wholesale, and pays the freight both ways.”

One northern Indiana cattle farmer saw prices on cattle at $1.15 a pound in early June. Regretting that he didn’t sell at that price, he said “That was good money. I was making money. Two weeks later, it has dropped to 98 cents. And so now I'm losing money.”

That same cattle farmer continued pragmatically, “my wife thinks when we get through this bunch of cattle we should sit out for a while. She doesn't think until there is a shot, a cure, a vaccine for the Coronavirus – she doesn't think any of this stuff is going to come back to normal.”

Hope for the future

By June, both Tyson Fresh Meats and Indiana Packers had opened their facilities back up for regular, socially distanced business. Later that same month, President Trump asked the Department of Justice to do a federal inquiry for price gouging into the U.S.’ four largest beef processing plants.

Seeing this, Indiana farmers shared optimism that the government would offer relief among the traumas of the pandemic. By July, more Indiana farmers were hopeful for a bailout package to provide relief, hopefully, after the harvest season in the fall.

According to a CNBC article discussing the potential for relief, “the U.S. Coronavirus stimulus bill passed by the House and Senate adds $14 billion to the Agriculture Department’s Commodity Credit Corp (CCC) spending authority. It provides another $9.5 billion for farmers hurt by the pandemic.”

With that said, and not despite of, but because of the cavalcade of seemingly endless obstacles served to farmers this year, they remain positive. One Indiana farmer stated that “we always stay optimistic because it's ups and downs, ups and downs. And it's our way of life.”

Only time will tell how the last half of 2020 will impact Indiana’s farmers.

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