‘You just can’t shut down agriculture’
Ag Commissioner: Virus adds to 2020 farm challenges
For agriculture producers who are already in a tough position with some fall crops still in the field and low market prices, a coronavirus outbreak has exacerbated their position.
Farmers are starting the 2020 crop year in a bind, said North Dakota Agriculture Commissioner Doug Goehring.
“This year out of all years, we’re probably in the worst situation we’ve ever been because a lot of that work wasn’t done last fall. A lot of the harvesting wasn’t done. A lot of inputs weren’t purchased or fertilizer applied,” Goehring said.
Even seed dealers were getting nervous in March as many farmers hadn’t made their purchases yet, he said. Although that has been picking up, there remain challenges in moving the quantity of products that will need to move this spring, both farm inputs and livestock, he said.
The state driver’s license division had shut down commercial driver’s license testing due to coronavirus precautions. About 312 people were waiting for testing by the time the state developed a structure for resuming operations, Goehring said.
The hope is to get the backlog of applicants licensed by August, he said.
Another issue relates to the visas necessary to bring in foreign agricultural workers, particularly from South Africa. So many embassies have shut down and the international processing in this country also has been affected by the virus, Goehring said.
“So there’s large impacts across the nation with H-2A workers coming in for our farmers,” he said.
Yet another issue has been the expiration on April 1 of restricted pesticide certifications held by more than 3,000 individuals. The governor was expected to address an extension or exemption in state law regarding that expiration date to avoid the need for training sessions. The state Pesticide Control Board has requested the Environmental Protection Agency grant a year’s extension.
North Dakota’s certification is good for three years, while some other states certify for four or five years, Goehring said. So extending North Dakota’s existing certification for a year would not be out of line, he said.
Goehring said the ability to continue running background checks for farmers who want to have a hemp license was a concern initially, but it appears it will not be a problem.
However, there may need to be an executive order on livestock licenses, Goehring said in late March, because more time will be needed, given the March 31 deadline in law for license applications.
The licenses affect livestock auction barns, dealers and agents involved in purchases of livestock.
“The other areas that we’ve been working with the industry on have been with auction companies and livestock auction barns. We worked with the industry to develop protocols based on what CDC has put out. We understand that at times you may have larger groups there. You need to make sure that you have adequate space, so that people can recognize and respect the social distancing. Also, only bidders and buyers allowed at any of these auctions. The public is is not to attend,” Goehring said.
Auction companies conducting estate sales for liquidation or equipment sales are urged to have only serious bidders and buyers attend
“We can resume things as other public activities are allowed, but for the time being, you just can’t shut down agriculture. I think what’s missed in so many situations – where the public forgets – is that if you’re calving in February, March and April, it doesn’t matter. Calves are coming. Seed has to go on the ground. Everything about our business is seasonal,” he said. “That also means that there’s certain activities and things that take place that have to happen. If you shut down a livestock auction barn, you really do disrupt the food chain. You disrupt people’s ability to to pay their bills. In many cases, you have farmers and ranchers out there that have limited feed supplies.
“So you can really disrupt someone’s bottom line and their ability to borrow and renew their operating notes when you start shutting down and affecting that economic activity,” Goehring said. “If we’re going to do some things, let’s mitigate, and let’s manage this in a responsible manner.”
In some of the smaller communities, banks have just shut the door, he added. People with operating notes in shuttered banks faced a dilemma, although many of those banks eventually sent loan officers back to work. The State Agriculture Commission has assisted in working with banks to ensure that farmers have opportunity to move forward with operating loans because they need the funds to make purchases necessary for this crop season, Goehring said.
The hope is for a normal spring in which planting begins in the south and slowly moves north to avoid a situation like last year, he said. In 2019, rain delayed seeding in some areas and everyone went to the fields at once, stressing the infrastructure for moving products when needed, he said.
He noted about a million acres of corn remained to be harvested in late March, but he said farmers have been taking advantage of favorable weather to get standing crops off the fields.
“They are slowly working on it,” he said. “This spring so far has been wonderful in the sense that we’ve been dry. We’ve had moderate temperatures. In fact, it’s reduced the flood threat. Product is coming off the field and actually the quality is not too bad.”
Farmers are able to get the crops to market. However, the collapse in commodity prices in response to the coronavirus crisis has been challenging for farmers who hoped to haul straight to market and take advantage of prices expected to be higher in the spring than in the fall, Goehring said.
“We’re probably, I would say on an average, maybe 10 or 15% less in price than we were last fall, and no one appreciated the prices we had last fall. They were barely getting you to break even, and in many cases weren’t,” he said.
“That’s just causing more heartache, more stress in their lives, but they know they have to get it done because they also want to try to do the best job they can to prepare that ground and get it ready to plant this spring. So it’s been a godsend that we haven’t been getting much moisture at all,” he said.
A strong export market could help in the longer term as well. Goehring said a concern is the high value of the U.S. dollar, which puts American farmers in an uncompetitive position on world market.
On a positive note, with the signing of the first phase of the U.S.-China trade agreement, there’s hope that China will eventually purchase an extra $19.6 billion in agricultural goods, Goehring said. Price benefit from that trade deal isn’t likely to become apparent until summer or fall, though, he said.
China’s agreed-upon purchase will include soybeans, wheat, some pulse crops and a small amount of corn. The specifics of those purchases aren’t certain enough to say how individual commodity prices might be affected, Goehring said.
“We really want to try and secure the ethanol business there because if we can get that ethanol trade up that does a lot to support corn prices back home here in our communities. But there’s a lot of moving parts, and it’s a bit fluid, and we don’t know exactly what was identified. We just know in general what China will be purchasing. We just don’t know to what degree,” he said. “We going to have to plan accordingly, and probably for the most part, farmers are going to have to stick to the plan that they were developing throughout the winter.”