Ag Alert January 27, 2021

NATIONWIDE NEWS

Pandemic disrupts nation’s entire beef supply chain The following information is provided byNationwide®, theNo. 1 farmand ranch insurer in the U.S.* more of my own corn and make more money than selling that corn on the open market.”

maintain a pretty good balancing act with a 120-head cow/calf operation. We’ve talked about cutting it down to 40 head and marketing exclusively through our local locker. We’re fac- ing that quandary: Do we stay at our current size or would we be better off doing more with less? We’ll do what will work best with our labor and what will allow us to control our prices the most. We’re considering models like these more seriously than before the COVID-19 pressures hit.”

If the landscape’s changed for your ranch since the COVID-19 pandemic hit, the Nationwide agribusiness team totally understands. For more tips and information to help maintain the safety of your farm, visit www.nationwide.com/lc/resources/ farm-and-agribusiness. *A.M. Best Market Share Report 2019. Nationwide, the Nationwide N and Eagle, and Nationwide is on your side are service marks of Nationwide Mutual InsuranceCompany. ©2021Nationwide.

The long-term viability of that strat- egy isn’t guaranteed. Feed grain prices will dictate how long adjusting feed rations and extending cattle finishing timeframes will help producers cap- ture value at a time when more normal market dynamics have shifted because of COVID-19. “Corn is cheap right now. If it was $5 a bushel, that would cause double jeop- ardy for producers holding back cat- tle longer than normal,” according to Nationwide Risk Management Services Director Doug Becker, who manages a family ranch near Cumberland, Iowa. “Because prices are so low, we can feed for 90 days where we previously would only feed 45 to 60 days. But when feed- ing that long, you’re just basically break- ing even. If corn wasn’t this cheap, it wouldn’t pencil out.” Producers who sell beef directly to consumers will continue to be chal- lenged by extended processing waiting lists. That’s especially true as proces- sors look to ramp up capacity to meet increasing demand fromproducers and consumers alike. “The COVID-19 situation has caused me to question the practices I am using. For example, because of COVID, I am working fromhome. If I knew I would be working fromhome in the future, I would move my calving window up a month or two so I wouldhave bigger, heavier calves for market,” Hommer said. He normally calves later in the winter because of howhe balances his herdwith his work with Nationwide. “I have always been hesitant to calve in February or March. I am not home to check on themfor roughly 10hours a day. As a farmer, I am happy to raise cattle for that consumer to purchase directly. However, I do have to know that the con- sumer will be there to purchase the cattle I raise,” Hommer added. “If the consum- er continues to source locally, I have no doubt the processors will expand their ownoperations. So, it givesmemore con- fidence about the long-termprospects of selling beef directly to consumers.” Others continue to work toward gen- eral growth as a way to future-proof their ranches. Such decisions call for a close eye on local market dynamics and the steps that will yield the most practical benefits to each operation. “Our local markets have experienced significant volatility, but we luckily didn’t have any cattle ready for the processor when we started becoming inundated with COVID-19 challenges,” Cumings said. “We will continue to focus on sav- ing heifers and slowly growing our herd as the market supports it.” Added Becker, “We’re just staying attentive to our marketplace here. We

The COVID-19 pandemic threw the brakes on a lot of businesses in 2020. The beef industry was one of the hardest-hit sectors of food and agriculture. Supply chain members from the cow/ calf operation to the grocery counter felt the pressure. Consumers faced sharply higher prices and processors saw oper- ations disrupted. Cattle feeders shifted marketing plans and feed rations to ad- just to supply and demand. Beef industry members continue to take stockofwhat they’ve learned. They’re weighing future changes andnewways to better prepare for future disruptions. As the No. 1 farm insurer in the coun- try, Nationwide employs talented and experienced people from agricultural backgrounds. Many of them also work in the cattle business and have expe- rienced firsthand the market volatili- ty and other complications caused by COVID-19. We talkedwith a few of those associates to get a feel for how they’ve adjusted to the pandemic. When the pandemic hit, beef pro- cessing capacity was slashed by lim- itations to person-to-person contact among workers. Small producers faced delays in processing and selling directly to consumers. Feeders adjusted rations to account for sudden supply disrup- tions. Idling ethanol plants, for exam- ple, shut off the supply of dry distillers grains and solubles, a common feed- stock in the Midwest. “We make our locker appointments a few months in advance when we have customers l ined up. Ear ly in the pandemi c , we reached out to our hometown locker and secured appointments for two months later than what we had hoped,” according to Nationwide Senior Consultant Erin Cumings, who has an Angus cow/ calf and small feed yard operation in Warren County, Iowa. “Our 2021 pro- cessing appointments are also later than we anticipated.” These types of delays caused many producers to make management chang- es to sustain the value of their herds. In some cases, that means feeding different rations to slow rates of gain tomatchwith extended processing schedules. In other instances, producers have changedmar- keting strategies altogether, to capture value in different ways. “I’ve received several calls from peo- ple looking for finished cattle to butch- er,” said Nationwide Risk Management Consul tant and Agronomist Derek Hommer. “Now that I know people are looking for finished cattle to purchase, I plan to keep more of them. They’re more profitable for a small cattle pro- ducer like myself than selling them as feeders. By feeding them out, I can use

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JOB #: 65871-2 CLIENT: AGCO CLIENT CODE: AGCO03 DOCUMENT NAME: FT20N005CM-track-tractor-grow-bold-track-star-full-page.indd FILE PATH: Macintosh HD:Users:nielsen:Documents:WFH_Work_in_Progress:65871-2_AGC_Fendt_Track_Tractor_Print_Ad:_renamed_for_client:FT20N005CM-track-tractor-grow-bold-track-star-full-page.indd PUB(S): - Bleed: 10.5" x 12.25" Trim: 10.25" x 12" Live: 9.25" x 11" Cyan Magenta Yellow Black DATE: 9-10-2020 1:56 PM USER NAME: Nielsen, Kara NOTES: 65871-2_AGC_Fendt_AD_ TrackStar_XX_10.25x12_v6 Track star Like all great track stars, this one puts up game-changing numbers. It’s the new 1100 Vario MT ™ . And it’s here to up your operation’s efficiency. How? For starters, our Smart Ride ™ load-leveling system paired with our low-rev engine makes it a performance powerhouse. Then there’s the VarioDrive CVT drivetrain — helping you minimize slip, decrease soil compaction and maximize fuel economy for up to 10% in savings a year. All of it backed by Gold Star Customer Care for three years of confident coverage. All numbers that prove the 1100 Vario MT will transform how you grow bold. GROW BOLD AT FENDT.COM/US GCD: John Neerland AD: Daniel Linnihan CW: Zach DeBlaey AE: Bryan Munsell SANTA MARIA QUINN COMPANY 805-925-8611 www.quinncompany.com WILLOWS HOLT AG SOLUTIONS 888-717-9045 www.holtags.com WOODLAND HOLT AG SOLUTIONS 888-717-9045 www.holtags.com YUBA CITY HOLT AG SOLUTIONS 888-717-9045 www.h ltags.com 6 1 Track star Like all great track stars, this one puts up game-changing numbers. It’s the new 1100 Vario MT ™ . And it’s here to up your operation’s efficiency. How? For starters, our Smart Ride ™ load-leveling system paired with our low-rev engine makes it a performance powerhouse. Then there’s the VarioDrive CVT drivetrain — helping you minimize slip, decrease soil compaction and maximize fuel economy for up to 10% in savings a year. All of it backed by Gold Star Customer Care for three years of confident coverage. All numbers that prove the 1100 Vario MT will transform how you grow bold. GROW BOLD AT FENDT.COM/US © 2020 AGCO Corporation. Fendt is a worldwide brand of AGCO Corporation. AGCO and Fendt are trademarks of AGCO. All rights reserved. FT20N005CM ALBANY HOLT AG SOLUTIONS 888-717-9045 www.holtags.com BAKERSFIELD QUINN AG PRODUCTS 661-393-5800 www.quinncompany.com FRESNO QUINN COMPANY 559-896-4040 www.quinncompany.com LOS ANGELES QUINN COMPANY 562-463-4000 www.quinncompany.com OXNARD QUINN COMPANY 805-485-2171 www.quinncompany.com RIVERSIDE QUINN AG PRODUCTS 951-686-4560 www.quinncompany.com SALIDA HOLT AG SOLUTIONS 888-717-9045 www.holtags.com SALINAS QUINN COMPANY 831-758-8461 www.quinncompany.com

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PM: Allie Quinnell PA: Kara Nielsen PP: Brad Smith

January 27, 2021 Ag Alert 25

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JOB #: 65871-2 DOCUMENT NAME: FT20N005CM-track-tractor-grow-bold-track-star-full-page.indd FILE PATH: Macintosh HD:Users:nielsen:Documents:WFH_Work_in_Progress:65871-2_AGC_Fendt_Track_Tractor_Print_Ad:_renamed_for_client:FT20N005CM-track-tractor-grow-bold-track-star-full-page.indd PUB(S): - DATE: 9-10-2020 1:56 PM GCD: John Neerland

PM: Allie Quinnell