The COVID-19 pandemic has a affected every segment of the global, national and regional economy, having some very grave effects over the agriculture industry as well. Here are some forms of manifestation of the coronavirus crisis.
Unemployment
The food processing and food service industries being among the first to be hit by the COVID crisis, the reverberations soon reached the agriculture industry, with diminished buying power. The decreased demand for particular agricultural products, paired with higher energy prices and transportation difficulties have forced many farms and ranches to reduce their personnel or to go out of business. As a result, unemployment rates increased even further, leaving many people without work.
Decreased Production
The farms and ranches and agricultural companies that had to let their workforce go could not maintain their performance and started to produce much less. While in certain areas, decreased production was met by decreased demand, in others, the gap between supply and demand widened considerably.
Loss of Income
Reduced production leads to reduced income and no production leads to no income. The companies that had to decrease or discontinue their production activities were faced with losses in terms of income, while they still had overheads and other expenses and costs to cover, leading to more debt in the agriculture segment.
Increased Production of Waste
When the pandemic broke out and the lockdown measures were implemented in response, the agricultural segment was in full swing and preparing for a peak period. Most agricultural products being quickly perishable, the segment is highly sensitive to swiftly moving goods between manufacturer and client – any hindrance in that process leads to products becoming spoilt.
Insecurities and Fears
The year-long crisis that the agriculture has been faced with has had severe consequences for motivation as well. The number of farms, ranches and agricultural companies has already decreased significantly and even more businesses are thinking of abandoning their previous activities because they consider the future to be gloomy, difficult and insecure.
The Need to Reinvent and to Restructure
According to agriculture news sources, to come out of the crises, agricultural companies need to start thinking out of the box, finding new solutions to increase their production, while decreasing the costs and to streamline their operations in every area of activity. One way to stay alive in such difficult times is to focus more on doing business locally, on serving local communities, rather than look for remote buyers. That way companies could reduce their logistics networks and transport costs and they could also contribute to the development of their local communities. Another solution could be a more wide-scale adoption and implementation of modern technologies, such as digital solutions that ensure more efficient crop and livestock management and the deployment of modern agricultural machines that can ensure efficiency with much less human effort. Companies should also adopt cheaper and more creative marketing solutions that combine digital methods, presence at community and industry events and other modern approaches. Rethinking production methods and finding new processing methods are also crucial to create a strong agricultural environment that is able to survive whatever comes next.