Burnett on Markets: Suddenly agriculture is important

COVID-19 is putting food security in the spotlight

(MarketsFarm graphic)

MarketsFarm — A trend has developed in the business news channels over the past week that has not been hard to miss. Suddenly the CEOs of big agriculture and food concerns are being featured front and centre during the business segments. Usually these companies are noted only when they release quarterly results and even then there is not enough interest to conduct a live interview. Suddenly CNBC is running segments on Cargill, ADM, Mondelez, General Mills and other like companies. Grocers are also of interest as they are brought on to assure us that the toilet paper supply chain is not broken. It took a major pandemic for people to notice the remarkable feats our farms and agricultural businesses perform every day.

Most of us who are involved in agriculture know how important the business of growing food is to our society. This is why we are in the industry and quite frankly, most times it’s frustrating to have to explain how complicated and important this business of growing and distributing food really is. I have no doubt that after this pandemic is over people will quickly return to their ho-hum attitude toward the fact that grocery have fully-stocked shelves with food produced around the globe.

We will be planting the 2020 crop in North America in the middle of the most serious pandemic in over 100 years, and the markets are not concerned. In North America over 200 million acres will get planted in a mere eight weeks or so. Whatever the weatherman throws at farmers, whatever the input supply chains do to disrupt seeding, farmers will get this job done. It would be nice to see some recognition for keeping the store shelves stocked, even if there isn’t a pandemic.

Markets are recognizing the value of agricultural commodities relative to other investments. Although the rally in gold has boosted the commodity to the top of the list, spring wheat and canola have managed to continue to hold onto their value relative to other investments. In other words, agriculture commodities are an island of stability in stormy seas caused by the COVID-19 outbreak.

— Bruce Burnett is director of markets and weather information for Glacier FarmMedia and its MarketsFarm premium subscription service.

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