Difficult Year for Livestock Producers

Tim Hammerich

News Reporter

The global pandemic has made for a challenging year for livestock and poultry prices. American Farm Bureau Federation Economist Michael Nepveux breaks down the impact of the pandemic into two events.

Nepveux… “One is a demand event, which was what you saw at the end of March with consumers rushing to the stores when lockdowns were first being put in place. And there was retailers with empty meat cases. And we were kind of at that point where a lot of people who don't know much about the food systems thought that we might be facing a food shortage, but at that point it was just a short term supply chain hiccup.”

Nepveux says it took time for the industry to transition from foodservice to more retail, but says the more lasting impact will likely be felt on the supply side of the equation.

Nepveux… “You started having those labor issues at the plants and you started seeing plants shut down and then operate at 60 %or 70% capacity. That also caused a massive backlog of animals that had nowhere to go because they were put on feed. Pork especially and a lot of our livestock are in this kind of just in time delivery system. And whenever the plants shut down or they just are operating at reduced capacity, you have nowhere to send these animals. So it's taken us pretty much all summer to work through these animals. And depending on who you talk to, we still have somewhat of a backlog in certain areas.”

The next concern for livestock and poultry producers: recession and what that could do to longer term demand.