Analysis released by the National Corn Growers Association (NCGA) today showed cash corn prices have declined by 16 percent on average, with several regions experiencing declines of more than 20 percent, since March 1 as a result of the COVID-19 pandemic. The analysis projects a $50 per acre revenue decline for the 2019 corn crop.
“The COVID-19 pandemic is being felt across all sectors of our economy,” said NCGA President Kevin Ross. “This analysis clearly illustrates its impact on corn growers and will be beneficial as we work to ensure they have the resources needed to navigate these very difficult times.”
NCGA commissioned the economic analysis, conducted by Dr. Gary Schnitkey of the University of Illinois, as part of the organization’s efforts to better understand the economic impact of the global pandemic on the corn industry and work to create solutions to help corn farmers and their customers recover from the financial impacts of this crisis.
The analysis was based on cash corn prices as of mid-April and estimated losses would likely increase through the rest of the marketing year. Further analysis is already underway for the 2020 crop year, with losses anticipated to be higher than those in 2019.
“Corn will be one of the most impacted crops as its two largest uses – livestock feed and ethanol – are under pressure. Impacts of reduced livestock demand are just beginning to come to bear in the market, as livestock processing plants are beginning to be disrupted,” wrote Schnitkey.
An average Price Loss Coverage (PLC) Program payment of $17 per base is projected for corn which would fall short of covering 2019 revenue losses, underscoring the need for the assistance provided by the U.S. Department of Agriculture’s (USDA) Coronavirus Food Assistance Program (CFAP).
NCGA will continue to work closely with members of Congress and federal agencies on ways to mitigate the pandemic’s impact and help farmers recover. You can learn more about these efforts at ncga.com/covid-19.
Read the analysis: Impacts of Coronavirus on 2019 Corn Revenue