Nearly all of the U.S. pork packing plants are running today, but are not operating at full capacity. There are expectations hogs will continue to back up in the system through the end of the year, putting added pressure on the swine industry. Nate Franzen, who is the president of the ag banking division of the First Dakota National Bank, is advising farmers to control what is controllable.
“Whenever we’re in a black swan event like this one I really look to equity preservation, what are the key risk indicators in your business beyond those performance and production indicators that you watch everyday in a normal environment. What can you do to preserve your equity and maintain your core equity and keep that working capital up, those are going to be just vital for you.”
In this uncertain marketplace, answers can be hard to come by at times.
“Sometimes we can just become so overwhelmed with all the information coming at us, we become paralyzed, and that’s a really dangerous situation. Just don’t allow yourself to become paralyzed, stay focused on what you can control, manage the risks that you can manage and recognize that you cant deal with some of the other things going on around you in this environment.”
In a Pork Checkoff-sponsored webinar, Franzen emphasized the importance of communication.
“Communicate with your lender, communicate with your partners and your stakeholders. We can make the most out a challenging situation if we’re talking and brainstorming and coming up plans and solutions. But when the communication goes silent, it’s really difficult for us to move forward.”
Resources are available online, including this webinar, at https://www.pork.org/public-health/what-you-need-to-know-about-covid-19/.