As commodity prices drop due to COVID-19 fears, farmers and ranchers are becoming anxious. Many have held onto grains, feed and livestock in the hopes that prices might soon swing upward.
“Everything is pounding them right now,” said Duane Hund, director of the Farm Analyst Program in K-State’s Department of Agricultural Economics in a release. “As those values go down, those people are wondering what effect this is going to have on their cash flow analysis as we move forward.”
As markets continue to drop, producers continue to lose income. Like Ben Amerin of Plains, Kansas, producers are not sure when the best time to sell would be.
“We just sit on it,” Amerin said. “We just can’t sell them for the price (offered right now).”
Amerin is hopeful prices will rise soon. Others are not as optimistic.
“There are just a lot of questions, and as we see these markets continue to dive, there just doesn’t seem to be a bottom now,” Hund said. “It’s causing a lot of anxiety, to put it mildly, among producers and I’m hearing anxiety coming from the lending community also.”
Some farmers are not sure if they can weather the drop in the markets. Hund said farmers need to stick with their business plan. This plan ends up being the producer’s road map.
“My first order of business is to tell them to follow their plan. Let’s not make knee-jerk, drastic decisions. Let’s stick with the plan in place and develop alternative decisions that are made in combination with the facts and what your business advisers will tell you,” Hund said.
One strategy for recovery, Hund said, is to remember the tasks that producers do every day in normal times.
“In stressful situations, our ordinary tasks fall to the wayside because our mind is so bombarded with all this information,” he said. “We may be losing ground with our ordinary tasks, such as keeping our cows fed and our lists of ordering supplies for spring planting, which is just around the corner.”
Most farmers follow a rhythm of planting and sowing. Hund urges producers to continue to order feed or seeds and get the tractors ready. Basically – stay on course.
“By doing those ordinary things that are part of our cadence,” he said, “we can have some control in a chaotic environment if we just keep things steady and going forward.”
The Kansas Agricultural Mediation Services offers free, confidential support for farmers and ranchers. The program can connect producers with K-State’s Farm Analyst program and other resources to help through the down market.
The toll free number is 1-800-321-FARM (3276) or contact the newly set up state of Kansas government website to help Kansas Farmers with stress: kansasagstress.org/