It's no secret that the agriculture industry has been hit hard due to the COVID-19 (i.e. coronavirus) pandemic. Labor shortages and supply chain hang ups that were already widespread issues in the industry are further cutting into farmer’s bottom lines. Meat and dairy producers have struggled to shift supplies from restaurants to grocery stores, leading to in-store shortages. However, experts say that America is not facing food shortages; the problem lies in inefficiencies in the supply chain.
Labor shortages have led to planting and harvesting issues across America
Even before the epidemic, America's farmers have faced chronic labor shortages. According to the American Farm Bureau Federation, up to 20% of America’s farm workforce is composed of temporary foreign visa workers.3 Now, with tightening immigration policies and many workers getting sick, there is ongoing concern surrounding the lack of labor supply. According to KSBW 8, about 25% of Covid-19 cases in Monterey County are in the agriculture industry6.
Getting food to consumers is another major issue
As the pandemic erupted in China, shipping containers became hard to find and aircraft were grounded - putting a damper on international trade. Lack of air freight and truckers has had an impact on the delivery of fresh produce.2
And some farms are being hit worse than others, particularly those supplying the food service industry (i.e. restaurants, schools, hotels, etc). School and restaurant closures have wiped out a significant portion of the demand for dairy. According to ABC 30 News, the coronavirus outbreak could force some California dairy farms out of business altogether after years of low dairy prices.4 Specialty farms supplying restaurants with fresh, organic produce have also been significantly impacted.
With highest unemployment since the Great Depression, budgets are notably tight
Mass uncertainty in the supply chain has led to shrinking demand as consumers reduce budgets and buy less. Many consumers may be forced to shift their diets away from more expensive healthy foods to cheaper alternatives. Labor intensive strawberry farms have been hit hard by the lack of labor and demand. Carolyn O'Donnell with the California Strawberry Commission says California strawberry farmers may face up to 30% losses at the peak of production.5
What should farmers do next?
With economic uncertainty weighing heavily over the world, it is important for farms being affected by coronavirus to keep costs down and use resources efficiently. Wexus can help farms save money, energy, and water by maximizing resource efficiency. Our software platform helps manage energy and water usage by continuously mining data for cost savings, automating utility bill tracking and TOU rates, optimizing energy and water usage, and tapping into rebate and financing programs to replace worn-out equipment.
About the Author
Josh Reagan is an intern at Wexus Technologies. Josh grew up among farms in California's Central Valley and is pursuing a degree in mathematics.