The Coronavirus and Potential Impacts on the Agricultural Economy
Dr. Nick Piggott identified four areas of questions and concerns the agricultural industry is currently experiencing in response to COVID-19. The summary of his findings are further explained in the Full Economic Outlook.
1) Farming will likely be unprofitable in 2020 with most commodity prices currently tanking to double-digit percentage losses since the crisis began.
2) Can the agricultural supply chain function at capacity given that processing of meats, poultry, and produce are labor-intensive which makes social distancing difficult and means workers could contract and spread the coronavirus, forcing processing plant shutdowns?
3) Can the agricultural supply chain transform to support how Americans are now consuming food due to stay at home and social distancing rules?
4) A significant spike in unemployment and loss of income will shift and change the demand for food. Some Americans will spend less on food due to having less disposable income, and they will change their preferences to less expensive basic foodstuffs for at-home consumption.