SAN FRANCISCO (KRON) – Amid the ongoing coronavirus pandemic, farmers in the United States are now likely to lose billions of dollars in income as the crisis continues to grapple the economy, according to a new report.
Farmers are projected to lose an estimated $20 billion in net income this year, according to an updated economics report published this month by the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri.
The forecast updates a January report by FAPRI with the purpose of pinpointing highlight the effects COVID-19 will have on farmers.
“We’re looking at a situation with a lot sharper – or very big decline in farm income relative to what had been expected,” Patrick Westhoff, director of FAPRI, said in the report. “It’s a much tougher time for farmers than we would have guessed a few months ago.”
Researchers used a reference point taken into account after the first phase of January’s China trade deal was signed to make these projections.
Additionally, the report reveals that in the short-term, the pandemic will have a broad effect on US agriculture across the board. This includes all areas such as crop, livestock prices, and fuel and ethanol demands.
The decline in consumer spending will suppress demand for farm products, forcing prices to go even lower, the report predicts. Prices for crops like corn and soybeans are likely to decline 5% to 10%, and the market price for livestock could fall as much as 12%.
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