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Shutdown Impact on Agriculture

by Mike Austin

Agriculture is among those industries that are not immune to the impact of the partial shutdown of the government. Although the total brunt of a shutdown would not be felt until next year there are some immediate points of concern. One which impacts one of the strongest sectors of the ag industry, exports, is the closing of the Market Access Program and the Foreign Market Development Program, both which provided funding for trade promotion work. Also FSA employees are on furlough meaning a restructuring of availability for crop and other important loans. And the USDA is virtually closed. At World Dairy Expo that point was quite clear as both the USDA and the FSA had a booth but because of the furloughs , no one was there to man them. Another key element is that the USDA website is down and until further notice, the agency will not be issuing any reports. That means those involved in trading commodities, dairy and livestock will no longer have a key tool in determining supply, demand and price.

Jacquie Voeks with Stewart Peterson says depending on the length of the shutdown this could impact the volume of trade and keep some speculators out of the markets.

Missing these USDA reports are going to be a hindrance to those who trade commodities and livestock although they do have other venues for information. However market analysts  do feel the lack of USDA reports may deter speculators from trading commodities and like them or not the do play a role so with out them expect lower volume and fewer trades at the major exchanges.

Oh and one more thing, as long as Congress is focused on the shutdown and the debt ceiling, the chance for a new long tern farm bill sits in limbo