LINCOLN, Neb. (AP) – The Nebraska Farm Bureau says the state potentially faces nearly $3.7 billion dollars in agricultural losses from the coronavirus pandemic if economic conditions do not improve.
The Farm Bureau analysis is based on commodity prices from January to May of this year and an estimated $1.3-billion loss by Nebraska’s ethanol industry. It does not account for any financial assistance farmers and ranchers receive from COVID-19 relief programs.
Farm Bureau senior economist Jay Rempe said the losses could come as the result of the shutdown of the hotel and restaurant industry as well as low commodity prices and the shock to the supply system from processing slowdowns.
Rempe says “it was kind of a one-two punch. Oftentimes the industry can deal with a single punch, a demand shock, but when you get both the demand and supply shock that is really unprecedented and that is what the industry is struggling with.”
Rempe says the analysis “clearly demonstrates the magnitude of the financial challenges currently facing farm and ranch families” with an impact that could be felt across the broader rural economy.
He thinks the recovery of the agriculture industry in Nebraska is contingent on how the economy bounces back as a whole and if exports improve over the next year.