COVID-19 having two-pronged effect on farmers and the agriculture industry

Local News

ALLEN COUNTY, Ind. (WANE) — The coronavirus pandemic is impacting farmers in more ways than one.

“The two big issues in Indiana are ethanol and dairy,” Purdue professor of agriculture economics James Mintert said.

WANE 15 digital reporter Taylor Williams spoke with Purdue professor of agriculture economics and director of the Center for Commercial Agriculture James Mintert about what farmers and the agriculture industry is currently facing.

Ethanol Production

In Northeast Indiana, there is a handle full of ethanol plants. Ethanol is an alcohol fuel that’s distilled from plant materials, such as corn. However, with fewer cars on the road using fuel some plants are slowing, even stopping production, temporarily closing facilities.

The decrease in production and closures has hurt grain farmers. As the demand for ethanol goes down so does the demand for corn and corn prices also go down.

“We are a major ethanol production state,” Mintert said. “A large portion of our corn does go into ethanol.”

Ethanol plants in North Manchester and Portland are still in production. In a statement to WANE 15, a representative from POET ethanol plants said that the company had temporarily idled plants in South Dakota and Iowa and delayed a plant start-up in Shelbyville, Indiana.

Food consumption and distribution

COVID-19 has had a wide ranging affect on food prices, distribution and the way consumers purchase food.

“If you think about it what has happened with COVID-19 in this semi-lock downstate we are all engaged in, we are consuming food in a different way,” Mintert said. “We as a nation have shifted our food consumption from away from the home market to the at-home market which means nearly all of our consumption is originating in grocery stores.”

A majority of the food we consume on a day to day basis is consumed in what is referred to as the consumed away from the home market, like restaurants and diners. But with grocery stores becoming the primary provider for food, store shelves are empty and it’s also a big change in the distribution channel. The packaging, the size, and the process has all changed due to the virus.

“If you think about the meats for example,” Mintert said. “You think about the different types of cuts that move through the restaurant chains versus the cuts that move through retail size differ. So it has been a challenge overnight to shift over to a disruption system almost 100 percent to grocery stores.”

Planting Season

Farmers are about to head back into the fields to start planting for the year.

“We might see some shifts in the acreage of corn to soybeans because of the change in price relationships,” Minter said. “But I don’t expect to see a dramatic shift there.”

So far there is no signs that the virus will effect delays in the planting season like there was in 2019.

More information

The Center for Commercial Agriculture will be holding a free webinar on COVID-19’s Impacts on U.S. Food and Agriculture webinar on Monday, April 20, 2020, at 12:30 p.m. Anyone is welcome to attend online but you are asked to register before the event. To register click here.

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