Scientists had been warning us for years that a zoonotic pandemic might be dramatic in spread, effects, and consequences. And yet, many were sadly unprepared – and some still are.
How COVID-19 impacted animal production in 2020
In the early months of the pandemic, all around the world, operations closed down or worked at minimum capacity to prevent (or deal with) major outbreaks. In France, the US, the Middle East and all across the globe, animal processing capacity went down dramatically, prices dropped, while market demand also went down, leading to major losses for the industry.
In the US, COVID-19 cost the beef cattle industry an estimated total loss of $13.6 billion. In India, the top global milk producer, overall milk demand went down by approx. 25-30% at the beginning of the pandemic, while US pork harvest capacity went down by nearly 40% in the first few months of the coronavirus crisis. For poultry, in the same period, Bangladesh saw a 30-45% reduction in day-old chick production, combined with a selling price for day-old chicks below the production cost.
This global negative impact was driven primarily by these factors, many of which are in fact interlinked:
- Decreased access to raw materials and feed supplies
At the beginning of the pandemic, one of the most pressing concerns was ensuring access to feed supplies and raw materials. For many, the first few months meant taking stock, literally, of how the operation would be able to cope with the foreseeable shortages.
- Economic impact of worker health
Livestock farms were affected not because of coronavirus transmission to animals, but by the virus propagating like wildfire among workers. Physical proximity, insufficient biosecurity, working while infected contributed to a dramatic scene in early 2020. Entire operations had to shut down for weeks following severe outbreaks.
- Increased cost of basic operations
Operations had to take on increased expenditure for basic safety, for making up for loss of work hours related to quarantine/closures, for improved biosecurity for COVID 19 prevention (handwash, disinfectants, gloves, etc), logistics costs etc.
- Economic impact of culling, stunning, and carcass disposal
Because of employee sickness or absent workers due to school closures, as well as reduced demand and issues with transportation, production facilities were sometimes forced to increase culling or dump products.
- Reduced demand from the food service industry
The hospitality industry was dramatically impacted by coronavirus. This naturally led to much-reduced demand for fresh meat, eggs, and dairy products.
- Animal health care costs
Farm overpopulation caused by worker shortage was a gateway for a number of health issues for animals, especially fast-growth animals (such as broilers and pigs). From increased animal lesions to aggressiveness and heat stress, these resulted in reduced productivity and increased health care costs.
- Lower service accessibility
Restrictions on human interaction came with consequences for in-person services. Farm monitoring, non-urgent animal care, on-site audits were de facto forbidden, as they were driven by in-person visits. Where this happened, production performance can be assumed to have been impacted as well.
- Reduced movement of goods
Nationally and internationally, quarantine has imposed unforeseen restrictions on transport of livestock and products. This meant a reduced ability to transport animals between locations, but also a reduced ability to export/import, to drive animals to slaughterhouses, to supply international partners etc.
- Reduced buying power
A natural consequence of the pandemic was recession. While not as severe as some feared, the impact was more dramatically felt especially in low-income countries, leading to demand reduced even further because of reduced buying power.
Global revenue for travel and tourism: 2019, 2020 estimate, 2020 reality. Source
Our reckoning with COVID-19 is not over yet. Economists expect a 2.4 decrease in the value of global GDP over 2020 – and many consequences will only become apparent over time. However, new pandemics may be just around the corner and we need to learn from the mistakes of the very recent past.
Protect your animal production in 2021
The pandemic is not over. Even with vaccinations in progress around the world, this virus is here to stay. We can expect it to mutate and develop a level of resistance, just like any other virus, that will require us to be on our toes for a long time to come.
There is no reason to be overly pessimistic, though. A contraction of growth perspectives is natural under the circumstances, and markets are expected to recover in. However, to protect your business from the effects of global or local events, it is always a good idea to have a few basic processes lined up in case of crisis.
Practice supply caution
When transport restrictions were instituted globally, many operations were faced with the threat of lost supplies. It turns out, we had gotten too comfortable with our easy-access global networks and forgot to plan ahead.
Instead of overstocking, prepare strategies to deal with chain disruptions. Pro-actively discuss scenarios with your suppliers – ask them about their production plants, delivery chain, advance notification requirements. Are they crisis-proof? If things look shaky, look beyond them to companies with plants in several locations around the world.
Biosecurity is not just for animal health and economic safety; it is also for human health and long-term operation sustainability. The 2020 pandemic has taught us that rules are broken at your own expense.
Capture the online & supermarket retailers
The newfound focus on online platforms will not be as explosive as in 2020, but this remains an area of sustainable growth. This will further translate into more products in the prepackaged and long-life categories. With the reduction in fresh meat open markets, more demand will be placed on supermarket processed food and alternative deliveries.
Communicate with employees
Suspicions about colleagues being infected, insecurity about losing money over getting sick, mistrust of the company’s best intentions poisoned employees and pushed many of them to keep their symptoms hidden. But they also may have felt that compliance was somewhat up to them.
It’s important to communicate openly that you have the situation under control and under monitoring. When someone is diagnosed, inform everyone without naming the person. Alert close co-workers and support them to get tested. Respond to all enquiries. Send weekly reminders that breaches of good practices are noticed and ultimately penalized. And, above all, make it easy for your employees to observe good practices: place disinfectant in all common areas and provide masks for those who need to work in close proximity.
Some of the changes dictated by 2020 will reverberate across the years to come. Upgrading the skills of all your employees is an excellent long-term plan for the health of your organization. This should include virtual communication skills, as well as training to cope with – and remain effective in – a changed work environment such as working remotely where possible.
In the first couple of months of the pandemic, hundreds of thousands of companies waited to see what would happen. In the meantime, they issued identical statements – and deferred initiative. Standing still is a great way to let the others win the race.
Instead, just move ahead of the market. Taking initiative can mean contacting your government or sending out a public letter urging business-friendly decisions (as happened with Italy’s #MangiaItaliano movement). It can mean talking to your local authorities about reciprocal support: transport passes and tax relief in exchange for donating excess animal products to local charities.
Do not panic!
At the beginning of the pandemic, panic was the natural reaction. We are now sadly much more experienced with dramatic situations. And now we know that the only way to deal with the unexpected is to, well, expect it.
Understanding how things went wrong in 2020 is the first step in preparing better for 2021 – and whatever comes next.
Some of the effects of 2020’s coronavirus pandemic are not yet fully visible: from recession to depression to altered patterns of behavior, in both personal and business life, these effects will be noticeable far into 2021. And yes, we can do relatively little to prevent future pandemics. But we can do a lot to make our organizations safe from these pandemics. Taking stock of errors and building better preparedness are our best investment for pandemic-safe animal production.