by Megan Schiffres
As demand for corn plummets across the world, farmers in the Northern Neck are struggling to make ends meet in the midst of extreme market uncertainty caused by the coronavirus pandemic.
“Honestly it’s a punch to the gut every day in trying to market corn right now. Soybeans and wheat have been trying to gain some momentum lately but the entire market is overwhelmed by the fear of the virus,” said Rob Hinton, owner of Cedar Plains Farm in Browns Store.
Due to market instability caused by COVID-19, the value of corn has dropped by 15.83%, or 63 cents, since January. This sharp decrease is due to lowered demand for ethanol worldwide as travel restrictions and changes in the global energy market decrease demand for the corn byproduct and the gasoline it is used to produce.
Since the beginning of the year, the value of ethanol has fallen by 38.57%, or 54 cents. On April 1, ethanol prices dropped to 83 cents per barrel, its lowest level ever recorded. Because about 40% of corn grown in the U.S. is used in ethanol production, the falling price of ethanol has had a direct impact on the value of corn grown in the Northern Neck.
“This is bad. Crude oil is cheap, like $20 a barrel, it’s never been as cheap as it is now as I can recall. So that’s had an effect on ethanol plants that use corn to produce ethanol. Plants are closing or stopped accepting corn across the whole U.S. That’s had a tremendous effect on demand for corn. Everything is just snowballing,” said Allen Welch, owner of Welch Farms in Lancaster.
While the virus has led to decreased demand for corn, it also has had a positive…[to-view-more]