There’s been plenty of supply chain cause and effect because of COVID-19 in recent weeks. We’ve seen dairies dump their product for lack of demand, tomato farmers in Florida do the same, and meat processing plants across the country are scrambling because the virus has spread among their employees.
The stories are heartbreaking. Producers take great pride in their work, and it is a shame that demand and supply chain issues are impacting America’s farmers.
One supply chain issue Kansans might pay closer attention to is the low demand for ethanol and thus the low price of corn.
This really shouldn’t be a shocker. Recent developments with oil trade agreements pair with stay-at-home orders that leave the demand for gasoline low. This will have a direct impact on our state’s economy.
The Hutchinson News’ Alice Mannette reported Monday about one-third of ethanol plants are predicted to close, which reduces the need for corn. Because of the predicted plant closures, Mannette reports an estimated 200 million to 500 million fewer bushels of corn will be needed this year compared with last. That is a sobering number for anyone in the corn business.
This is the last thing Kansas corn producers needed. We may not be known as well for this yellow crop as our neighbors to the north in Iowa and Nebraska, but corn is an agricultural staple for our state. Kansas ranks fifth in overall area planted to corn for all purposes according to the USDA National Agricultural Statistics Service’s findings for 2018. The 2019 numbers aren’t available yet.
The Kansas Corn Growers Association and the Kansas Corn Commission have an online toolkit at kscorn.com/covid-19 to help producers navigate this situation. We suggest producers take a look if they are feeling lost.
If producers are still looking for a silver lining, we see a few.
The first is the demand for both wheat and sorghum is up. These are Kansas’ other staple crops. Perhaps they can help fill the void left by low demand for corn.
The other is a bit more philosophical: No one is better equipped to handle unexpected catastrophes than Kansas farmers. You have survived droughts, severe weather and recent trade wars, among many trials that would make others give up. Your relatives got by during the dust bowl. You can do this. We have faith in your ingenuity and resilience.
COVID-19 will pass.
This volatility in the supply chain will pass.
People will get back to work eventually, and the demand for ethanol will go up. It may not happen in May or with the flip of a switch, but it will happen.
When it is over, we look forward to hearing your stories and championing your successes. But for now, hang in there.
Supporting agriculture is critical to the success of our state’s economy. If our farmers suffer, so does the rest of the state. Producers, please know we stand with you.
