This is another example of the interdependencies that exist across our business economy. See some of the depressing stats below.
AccuWeather Global Weather Center – April 24, 2020 – The uncertainties for the American farmer are adding up faster than sales of face masks.
There’s the COVID-19 pandemic, of course, as well as what it may mean for the availability of vital field and back-office farm workers. The pandemic has also led to plummeting demand for produce, leading some farmers to destroy crops and dump milk.
Crude oil prices that dropped in a head-spinning manner have led to the latest challenge for farmers. Since fuel consumption has nose-dived because of COVID-19, there is now an historic decline in U.S. ethanol production – a key for corn-growing farmers since roughly 40 percent of corn grown is used for ethanol.
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All of this has occurred at the start of planting season in several key corn-growing states, leading farmers to piece together all of the ever-changing elements and decide how much corn they should plant this season – versus soybeans or other commodities – and how much of their products will be delivered come harvest time.
None of that even includes how farmers have to account for the key role of weather.
“Weather is not as great a factor as it sometimes is because of those other things that aren’t normally in play,” said AccuWeather senior meteorologist Dave Samuhel.
U.S. ethanol production has fallen off the charts; production declined 48 percent in just more than three months, from the fourth-highest all-time figure on Jan. 1 (1.095 million barrels per day) down to an all-time low (563 million barrels per day) on April 17.
