Livestock farmers and dairy producers in Missouri, and nationally, are being hardest hit by the COVID-19 crisis, but the pain is being felt across the agricultural sector, according to advocates and experts.
As processing and packaging plants shuttered or slowed production, and restaurants remain off limits to sit down customers, one recently published study out of the University of Missouri is predicting a $20 billion hit to the sector nationally, but that is only if the situation does not worsen considerably.
Gov. Mike Parson has announced that restrictions on gatherings of more than 10 people will end after Sunday and all businesses will be allowed to re-open, including restaurants.
In his announcement, Parson is encouraging people to remain six feet away from each other, except where it is necessary for the business to operate, for example hairdressers.
As Parson announced the lifting of restrictions, Smithfield Foods Inc. argued in the U.S. District Court for the Western District of Missouri Thursday that the company cannot be ordered to comply with guidelines laid down by Centers for Disease Control and Prevention (CDC) and state public health officials.
Company lawyers told the court that an April 28 executive order by President Donald Trump, which ordered meat processors to remain open, supersedes any other rules and regulations.
The suit was filed by a group representing workers at a plant in Milan, Mo., where eight plant workers were sent home with coronavirus-like symptoms. No cases are confirmed, but other plants reported major outbreaks.
Smithfield has shut plants, including one on Sioux Falls, S.D., where 800 of the 3100 employees tested positive for the virus.
In a report by the Food and Agricultural Policy Research Institute, based at the University of Missouri, net farm income could drop as much as $20 billion this year alone, a five percent swing from its forecast prior to the lockdown.
But Patrick Westhoff, the institute's director, said that drop is based on the situation not becoming any worse.
"If the situation is only this bad, then aid will largely off set (the drop in income)," Westhoff told the St. Louis Record, adding that in the region of $16 billion is being funneled to farmers under various programs.
But if the situation gets any worse, including a long recession leading to a severe drop in demand, including spending in restaurants, those income losses will look optimistic.
"It is very much across the board that will not be negatively affected, but proportionally much more on the livestock sector," Westhoff said. "Livestock is day to day, and milk produced all the time, and most in need of additional financing." The closure or reduction of capacity at plants will have an effect on the supply chain.
While livestock and dairy will be hit the hardest more immediately, the longer term reduction in demand will effect many others, including corn producers and Missouri's cotton farmers.
Restaurants have attempted to maintain some business with pick up and delivery, and there have been innovations by farmers trying to carve out markets, but it doesn't come near to making up the difference given the "magnitude of what is happening," Westhoff said.
Tim Gibbons, of the Missouri Rural Crisis Center, which represents independent family farms, said the pandemic has brought the centralization of the food supply chain into sharp focus.
"Overall, there has been a huge switch over decades to corporations, it is just more concentrated," Gibbons said.
Because food production is so centrally controlled through a small number of plants, the crisis has revealed how easily the supply can stop working, Gibbons told the St. Louis Record.
"It is hard to call a crisis an opportunity, but unfortunately there is a chance people may now see the system the way it is, and change for the better," he added.
Small farmers are still attempt to raise hogs and work with smaller packing plants, and some are working locally with restaurants to bring food for curbside deliveries, Gibbons said.
"I think in the short term what we are doing is to try and ensure stimulus money makes it to small farmers, but there the programs give a lot of discretion to (Secretary of Agriculture) Sonny Purdue and the USDA," Gibbons said, adding that many small farmers believe much of the money will go to large agri-businesses.
Eric Bohil, director of public affairs at the Missouri Farm Bureau, echoed concerns about the livestock sector.
"The biggest concern we have right now apart from prices across the board is livestock, the potential shut down of...plants, which is affecting pork, cattle and poultry," Bohl told the St. Louis Record. "There is a lot of problems with the supply chain, where farmers are not able to deliver."
This causes real trouble, because farmers "have a schedule, animals are ready, more are being born and raised," Bohl added.
Farmers are being particularly badly hit because they are not selling high end cuts, which are mainly produced for restaurants, he said, adding that the market has entirely gone away.
On the support funds available from Washington, Bohl said, "No-one is going to feel whole, and that is not the goal. It is keeping them in business, allowing family farms the chance to not go under, and get back to normal businesses."
The bureau representative said "people do need to get back to work," to prevent an even more disastrous economic situation, but the easing of restrictions must be done in a "safe and smart manner."