Crop Prices Rise; So Do Farm Building Costs

Coronavirus itself didn’t pose much direct threat to farmers’ operations. Most of their work is socially distanced already, and we all have kept eating right through the pandemic, so farmers could keep planting and harvesting and raking in the highest prices we’ve seen for corn, soybeans, and wheat since the last crop-price peak under President Obama.

But evidently Kristi’s farmer brothers needed $600K in government coronavirus relief checks because the pandemic drove up farm building costs due to tight supply:

Over the last year, particularly over the height of the pandemic, as supply dwindled and demand skyrocketed, prices for all building materials began to climb. As it stands, lumber prices sit over 200% higher than they did pre-pandemic. And the case is similar for almost every other commodity.

Supply is the primary issue as the pandemic closed borders, slowed imports and even shut down lumber mills in order to slow virus transmission amongst workers [Jager Robinson, “The Rising Cost of Business,” Tri-State Neighbor, 2021.03.29].

…and increased demand, as seen by the very busy general manager of Tyler Lumber COmpany in Tyler, Minnesota:

When at-home work began in earnest, Lambertus said he guesses that many began looking at projects to improve their home or renovate their space, which led to a dramatic increase in demand for basic materials.

“Local lumber yards had depleted inventory and started ordering more,” Lambertus said.

…Lambertus said that he was asked to redo a quote he gave back in May 2020. Due to the increase in supplies, the quote is now 43% higher with no end in sight. On March 15, Lambertus’ steel supplier, Long Creek Steel out of Beresford, South Dakota, had to inform their customers that the price for steel will once again be rising.

Even with the price markups, Lambertus said that business has not slowed down. People have continued to ask for renovation projects, or new ag barns and sheds, but the main difference became that prices on quotes are locked in for just a week, instead of the full 30 days it was pre-pandemic [Robinson, 2021.03.29].

It’s a good thing President Biden and the Democratic Congress are sending Kristi’s family more stimulus checks. Those government dollars should keep the Noem-Arnold clan farming, as government subsidy has for the last three decades.