COVID-19 Hits Supply Chain and China Phase-1 Outlook

COVID-19 Hits Supply Chain and China Phase-1 Outlook

Bob Larson
Bob Larson
From the Ag Information Network, I’m Bob Larson with your Agribusiness Update.

**Despite occasional slowdowns caused by rain, California rice farmers have had good weather for planting their 2020 crops, but acreage may be less than estimated, as some water districts have restricted irrigation supplies.

Farmers have also struggled with reduced availability of a key fertilizer, because imports faced pandemic-related shipping delays.

Farmers hope to finish rice planting by June 1.

**COVID-19 has created many disruptions in the supply chain that few predicted.

According to, hardest hit are the pork, beef, and chicken producers dealing with an unprecedented backlog of animals due to closures and slowdowns at meatpacking plants.

New estimates by the United Food and Commercial Workers International Union show at least 30 meatpacking plants have closed at some point in the past two months, resulting in a 40% reduction in pork slaughter capacity and a 25% reduction in beef slaughter capacity.

**Global grains trader Archer Daniels Midland remains optimistic China will meet its Phase 1 farm product purchase commitments despite the slow pace of buying and recent criticism of China by President Trump.

ADM CEO Juan Luciano tells, lower commodity prices due to the pandemic may limit the value of China’s first year U.S. ag product purchases, “but it’s a two-year agreement.”

Many worry China may not reach the deal’s lofty purchasing targets following a sluggish pace of buying.

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