COVID-19 impact on pork industry: Schulz

April 23, 2020
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Lee SchulzDr. Lee Schulz, associate professor, was interviewed on Iowa Public Radio, April 21:

"We’re also seeing a real heterogeneous impact because the situation is not impacting states at the same rates,” says Lee Schulz, a livestock economist at Iowa State University. “You are seeing much lower prices being paid to producers,” Shulz says. 


In the April 22 Quad-City Times story, "Waterloo Tyson closure impacts workers, farmers — and Iowa's multi-billion dollar pork industry."

Meatpacking plant closures because of coronavirus, even if brief, are likely to send ripples throughout the economy, said Lee Schulz, livestock economist with Iowa State University Extension.

"I think it’s very difficult to even characterize the tremendous impact that this has been to the pork industry," he said. "This has been a fast-evolving and dramatic impact, as we have seen prices for hog producers have been cut in half compared to last year."

Iowa produces about a third of the country’s pork — a $7 billion to $8 billion industry, according to Schulz.

"Many industries in Iowa support the pork industry, and the economic activity that is generated by the pork industry impacts industries across the board," he said.

Livestock farmers, the feed industry, transportation and the financial industry that is involved with the pork sector will likely feel the immediate effects, followed by other segments of the economy.

“You can see how these ripple effects occur,” Schulz said.

This story also covered:
The Courier, April 22


In an April 22 Southernminn.com story, "Producers seek options amid shutdowns."

“We’ve had shutdowns in the past, but that was typically one plant and the others were operating normally, so they could absorb that volume,” says Lee Schulz, Extension livestock marketing economist with Iowa State University.

“With this situation, it’s not a single plant, and that makes it more difficult. It’s a huge challenge when you back up all this meat, especially pork,” Schulz says. “With cattle, you have more options as far as placements and marketing. You don’t have that with pork or poultry.”


In an April 23 Des Moines Register story, "Pandemic creates heartache for Iowa farmers, workers — and possibly consumers, too."

Lee Schulz, an Iowa State University agriculture economist, said the influence on prices could vary widely as suppliers try to shift meat and other products from restaurants to grocery stores. The bottleneck at processing plants is driving some prices higher, Schulz said, while some prime cuts could be less expensive as restaurant demand drops. "The challenge here is the bottlenecks in the supply chain, getting the animals from the farm to the processor," he said. "And then getting that product to the consumers at the grocery store."


In an April 29 story, "The Country Has Plenty of Meat, Despite COVID-19 Plant Closures" on KOSU.

“We’re also seeing a real heterogeneous impact because the situation is not impacting states at the same rates,” says Lee Schulz, a livestock economist at Iowa State University.

Hog producers had been growing their headcounts in anticipation of an expanded market this year, especially as trade tensions ease with China and that country continues to fight a swine disease. Now, even if plants remain open, any profits farmers were hoping for may already be lost.

“You are seeing much lower prices being paid to producers,” Shulz says.

 

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