Even with health concerns and economic downturn due to the outbreak of coronavirus COVID-19, farmers are going to continue their work -- because Spring planting still needs to get done.
We already knew we were going into a difficult planting season with uncertain commodity prices, fluid trade situation and the continued spectre of bad weather. Now the coronavirus pandemic is adding new concerns that farmers need to consider.
Agribusinesses, in particular, need to understand these concerns and consider how, or if, they should modify their tactics in dealing with farmers during this crisis. This led Farm Market iD, in partnership with DTN, to conduct a survey of farmers detailing their concerns regarding the COVID-19 outbreak.
Not only do farmers have very clear concerns, but they have very clear expectations of how their agribusiness vendors and partners should respond.
Understanding these concerns and expectations can help you better serve and support farmers in their important work, keeping America and the rest of the world fed during this challenging time.
Are Farmers Concerned?
According to the Centers for Disease Control and Prevention, people at high risk of death or severe health impacts due to the coronavirus are individuals aged 65 and older, as well as those with compromised immune systems. From an economic perspective, small businesses are being hit hard by forced closures and the resulting unemployment spike.
Since the average age of the farmer is 63 years old, according to our 2018 crop year data, and farmers are essentially small business owners, it makes sense to ask the question: are farmers concerned about the impacts of the COVID-19 pandemic and what are they doing about it?
The answer is clear: nearly 90% of farmers surveyed indicate they are at least somewhat worried about the impact COVID-19 will have on their business.
More than 50% are very or extremely worried on the potential impact. 54% say their pessimism has increased since the beginning of the year.
In terms of concerns, farmers were asked to list their top 3 concerns, and here are the results:
- 77% listed health and safety of family, friends and employees
- 69% listed the overall U.S. economy
- 68% listed trade and commodity prices
Yet with all that's going on, just 30% of farmers would describe their outlook on the crop season as negative, with just over 50% saying that they see it as positive and about 20% neutral.
We suspect last year’s record MFP payment of $14.5 billion, a 21% increase over 2018, along with an expectation of similar or greater amounts in 2020 is leading the cautious optimism.
In light of the $2.2 trillion stimulus package with more to come, continued challenges in China trade and the November election likely to increase farm appropriations, it is understandable why there may be some optimism buried underneath COVID-19 fears.
Our survey reflects the farmer’s support of the current administration with 85% saying they would vote to maintain the current administration.
Expectations of Agribusinesses Vendors and Partners
The farmers surveyed voiced changes they want from their agribusiness vendors during this time, both from a public health and financial perspective.
Given all the concerns around social distancing and staying home to slow the spread of COVID-19, it's not surprising that 54% of farmers say they are less likely to meet in person with their retailer, grain elevator, or other agribusiness. 68% of farmers prefer that agribusinesses call rather than visit, 34% are open to email and 30% open to text, while less than 5% are open to communicating via video chat.
In addition to social distancing expectations, farmers were asked in the survey to select their top 3 things that agribusiness vendors and partners can do to help during these uncertain times. Here are the top results:
- 71% want good, open communication
- 68% want price reductions
- 55% want flexible payment terms
If you're an agribusiness with a solid farmer base, it would please you to know that you still have your farmers' trust. Only 21% of farmers are more than moderately concerned that input supplies will be able to supply the products they need.
Given the COVID-19 challenges and the responses above, agribusinesses with a solid eCommerce or digital farming applications that support collaboration are well suited to serve their customers during these challenges.
In fact, 56% of farmers surveyed said they are more likely or much more likely to engage with their vendors digitally or engage in some form of eCommerce.
Farm Operational Changes
As many farmers across the United States start planting crops, they are making changes in their business in an attempt to lessen the impact of COVID-19. Four out of the top five deal with farmers managing their farm finances with greater caution.
Here are the top changes that farmers are making:
On the other hand, there are other changes that are promising for those who are hoping for some stability in the market. 71% of farmers are making no changes to their crop choices and seed selection. 87% are making no changes to their U.S. Department of Agriculture farm program elections.
Regardless of the impact of the virus, these numbers indicate that farmers are confident they will be able to plant and harvest this year.
Farm Preparedness & Continuity
Given the volatility of the economy, it makes sense that farmers would be concerned about the future stability of their farm operations, and that's exactly what the survey reveals.
80% of farmers are at least a little concerned about coronavirus impacting the survival of the farm or ownership of the land, but only 29% said it concerned them more than a moderate amount.
Yet even with this level of concern, a shocking 70% of farmers have no backup operating plan should they contract the virus.
The more that agribusinesses can help farmers keep their operations stable and productive, the better off our industry will be.
To learn more about the survey results, click here to read the full report.