University of Maryland Extension

COVID-19 Impact Survey Results on Maryland Producers

Author: 
Ginger S. Myers
COVID-19 virus and dollar sign

Mastering Markeing - February 2021

A lot has happened on the farm marketing scene since March 2020. Farmers, processors, and other small businesses have quickly adapted to stay in business in a constantly changing environment of pivoting markets, processing bottlenecks, and government support programs.

There have been reports from various groups and universities on the effects of the COVID-19 pandemic on farm gate sales, international markets, and the distribution of the various government support funds. This survey does not seek to replicate any of those results, but rather focus specifically on the COVID-19 pandemic’s impact on Maryland‘s farms, agritourism operations, and specialty food operations.

How have Maryland’s producers adapted to the changes forced upon them and how has it affected their operations economically? What obstacles or opportunities have they experienced? How can we craft programs, regulations, or collaborations to address these problems?

The University of Maryland Extension Agricultural Marketing Program conducted an online survey of Maryland producers who subscribe to the program’s newsletter and retail marketing newsletter. There were 33 respondents representing 14 counties. Input from the survey is organized here in four topic areas:

A. Respondent Profile

B. 2020 COVID-19 Related Production and Marketing Disruptions

C. Revenue Categories

D. 2021 Projections

While there are several interesting factors recorded in the survey responses, the summary and conclusion of this report looks to identify marketing and production obstacles and opportunities for producers as we continue with the COVID-19 restrictions and protocols still in play.

A. Respondent Profile:

1.

33 respondents from 14 different counties.

2.

69.23%  Best described their farm location as “rural”.
26.92%  Best described their farm location as “Suburban”.
3.85%    Not designated

3.Farm products listed included: fruits, vegetables, meats, eggs, livestock, milk, wool, compost, bakery, honey, honey bees, grapes, wine, distillery, value-added products, field crops, and turkeys.
4.

Growing practices were identified as:   

42.31%  Conventional
l7.69%   Certified Organic
30.77%  Practicing Organic
9.23%    Other-Integrated pest management, organic exempt, no-till, low impact

5.96.15% of respondents own or manage a farm
3.85% Other
6.Business ownership tenure:
Business ownership tenure pie graph
7.Acreage farmed:
Acreage farmed pie graph
8.Respondents were:
52%  Male
48%  Female
9.Age range:
Age range pie chart
10.Level of formal education:

12%  High school graduate/GED
12%  Some college
60%  College graduate
16%  Master program

B. 2020 Covid-19 Related Production and Marketing Disruptions

Almost 62% of the respondents replied that COVID-19 related disruptions did not cause them to have excess products and these were marketed through their traditional channels. But 38% replied they experienced disruptions in their markets.   They were able to move excess/unsold product through: storage, left in the fields, wholesale, donated to food banks, less processing of milk and more fluid processing, and added inventory.

A question concerning revenue disruption in 2020 as a result of excess products elicited a variety of responses ranging from dollar values to antidotal comments. Losses ranged from:

  • Dollar values $500- $50,000
  • Percentages  0% - 60%+

Comments included:

  • "Lost about $8000 from a primary market. Then we switched and sold that product at one of our other markets. We’re vertically integrated”
  • “We lost 80% of our crop to a May freeze and the other 20% went unharvested due to COVID-19.”

Livestock and dairy producers experienced disruptions in both their production capacity and market channels. Fifty percent of meat producers had problems getting animals into processors. Changing their cuts and packaging for new direct to consumer markets was challenging for 8.33% for these producers as they moved from restaurant sales to retail markets. Still, 25% of the meat and dairy producer respondents reported no disruptions in their processing or marketing avenues.

C. Revenue Categories

Respondents were asked to share the percentage of their sales by market outlet for 2019, prior to the pandemic, in 2020 with the pandemic, and then project their percentage of sales through their market outlets for 2021.

2019 Revenues pie chart2020 Revenues pie chart2021 Projected Revenues pie chart
                       Year 2019                 Year 2020                    Year 2021

D. 2021 Projections

Production in 2021

Respondents were asked, “Are you planning to adjust what you raise in 2021 as a result of the COVID-19 pandemic?”

  • 42.31%       Yes
  • 19.23%      Maybe
  • 38.46%      No

Revenue Expectations in 2021

Projected annual farm revenue 2021:

  • 12.50% Less than $10,000
  • 20.83% More than $10K but less than $50,000
  • 20.83% More than $50,000
  • 8.33%   More than $100,000
  • 37.50% More than $250,000

This is in comparison to their 2020 actual annual farm income:

  • 12.00%  Less than $10,000
  • 32.00%  More than $10K but less than $50,000
  • 12.00%  More than $50,000
  • 12.00%  More than $100,000
  • 32.00%  More than $250,000

The final survey question asked for a subjective evaluation of the changes in their operation due to the COVID-19 pandemic and their impact on the farm’s profitability.

  • 44%    Less profitable
  • 20%    Same profitability
  • 36 %   More profitable

Survey Summary:

Respondent profiles from this survey closely mirror the Maryland 2017 USDA Census of Agriculture farmer profile for average age (57 years old), average annual farm income ($53,997), and a majority of the farms being less than 100 acres. Two-thirds identified their farming location as “rural. The remaining one-third classified their location as “suburban” with most located in counties surrounding Baltimore City. Although national trends note the profit potential in producing certified organic products, 4x more producers identified their farming production as “practicing organic production methods” as actually were certified organic operations. Respondents were well educated with 76% being college graduates and/or holding advanced degrees.

There is no denying reports of market outlet disruptions for producers nationwide particularly through institutional sales, shuttered restaurant, and limited farmers markets. Despite those same factors in Maryland, most survey respondents (62%) were still able to market their products through their previously established marketing channel.

Dairy and meat producers experience processing disruptions resulting in either total loss of their product and/or loss of potential sales. Fruit and vegetable producers that by-pass any processing stops found more willing buyers seeking locally grown and sourced food. Processing fruit and produce into value-added products and thus extending their shelf-life, also help mediate some of their market disruptions.

This survey was conducted in January 2021 when producers had the opportunity to examine their 2020 production and sales figures. This is also the time when producers often plan their next season’s production and marketing strategies. The majority of respondents are planning to make adjustments to what they produce in 2021. Although adjustments were not specified by product variety or volume, these producers do project an increase in their farm income.

The bulk of operations predicting the increase fall in the $50,000-$100,000 annual sales categories. This prediction would be predicated on an increase of product to market. Also, the market outlets are skewing towards a wider variety of direct to consumer connection with projected increases into categories in 2021 that weren’t major channels in their marketing plans in 2019. These outlets include home delivery, u-pick, sales to grocery stores, and even restaurants. Sales projections through farmers markets are somewhat lower due to the increase in variety of market channels served and the restrictive COVID-19 protocols that most markets will still be implementing.

Moving Forward:

We are now in the acknowledge-and-adapt phase of the COVID-19 pandemic. In many ways COVID-19 did not show us new problems in our production and distribution systems, but rather spotlighted the weaknesses in our current model.  Maryland farmers have pivoted to more direct-to-consumer sales, aggregation, and adding value and convenience to their products to adapt to changing market circumstances. The University of Maryland Extension Marketing program in concert with other state and federal agricultural support agencies must continue to assist Maryland producers to:

  1. Understand the impact of business disruptions and triage the unexpected.
  2. Adopt more digital ways of working and connecting with customers, knowing this will likely have lasting effects.
  3. Mitigate risk to their business by utilizing trainings and resources available from various state and federal agri-service providers.

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