The Government Shutdown’s Impact on Agriculture

As the longest government shutdown in U.S. history nears the one-month mark, there have been numerous stories in the popular press about the impact this is having on employees, contractors, and everyday Americans. But in addition, the agricultural community is beginning to feel the effects of this work stoppage as well.

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When the government shutdown occurred, many of the agencies ag retailers and their grower-customers rely on for information and money closed down for the duration. This included the USDA, EPA, and the Department of Transportation. Typically, growers count on many of the quarterly reports generated by these agencies to plan their market moves going into the spring.

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Worse still, some promised money for growers to keep their operations running is also in limbo. During the ongoing trade dispute between the U.S. and China, the Trump Administration authorized emergency aid payments to growers hurt by this trade war, particularly soybean growers who weren’t able to sell their harvests to Chinese buyers as their had originally planned at the start of the 2018 growing season. The first round of these relief payments was made during November 2018, but the new applications deadline was originally set for January 15. Since USDA is shutdown with thousands of its employees furloughed, analysts are uncertain at the moment when a second round of payments could be approved or even made. As many market watchers point out, this could significantly cut into the seed purchases discounts growers typically receive for placing their upcoming season orders early.

Now it’s entirely possible that Washington, DC, legislators and the President will reach some kind of compromise to reopen the government before the end of January rolls around. Or things could remain at a standstill. In either case, agriculture, as well as the general economy, are entering uncharted waters from a financial perspective.

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