Supply chain issues cause short and long-range problems for ag industry
As the supply chain slows, ripples from today's issues could continue into 2023, says NE Farm Bureau economist.
LINCOLN, Neb. (KLKN) – Supply chain issues are causing shelves to empty out all over the place, but they’re causing some particular problems for the ag industry, especially as we hit harvest season.
For farmers, those empty shelves could halt their progress for anywhere from a few days to a few weeks. Senior Economist with Nebraska Farm Bureau Jay Rempe says that’s time they can’t afford to lose.
“I think the biggest concern for farmers, with the harvest, is machinery equipment and parts”, says Rempe, “and wanting to get through harvest without any breakdowns and having to sit there and wait for a week or more to get the combine repaired.”
To put that in perspective, take a look at your driveway. If your car breaks down, parts availability could have it sidelined for an unknown amount of time. The same chip shortage that’s creating havoc in the auto industry is problematic for farm implements.
As an example, Rempe says, “Go to Grand Island, and the manufacturing facility out there. There are a row of combines out there just waiting for parts and chips.”
That’s just the immediate issue. There could be more problems heading into the spring, brought on by rising prices of goods.
“They’re probably going to be looking at changing the way they do things in terms of the fertilizers they use, and the compounds and the mixes they use, just because of the pricing and availability”, explains Rempe.
That could, in turn, make for a different look in the fields next spring.
“Corn is more dependent on fertilizer use than soybeans and other crops. We might see a little bit of changing around in the crop mix as a result of this, depending on the prices and supply of fertilizer”, says Rempe.
Rempe’s prediction is that we will continue to see problems well into 2022, and possibly into 2023, since it generally takes a year or two to rebuild from off-seasons like the ones we’re in the middle of.