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'It's discouraging for dairy farmers:' Coronavirus' economic impact on Wisconsin

Posted at 7:02 PM, Feb 05, 2020
and last updated 2020-02-05 20:02:02-05

With the first case of coronavirus confirmed in Wisconsin, the impacts could extend further than just health.

The economic impacts could be felt across all industries from manufacturing to agriculture. For Wisconsin, China is extremely important as the state's third-largest export partner in the world, according to the Office of the United States Trade Representative. So for Wisconsin's dairy industry, which has already struggled through tariffs and the nation's highest bankruptcy rate in the industry, this is another hurdle.

"Everybody is ready for this to be lifted and get back to ordinary business," Mark Stephenson, Director of Dairy Policy Analysis at the University of Wisconsin said.

Stephenson says China is the world's largest import buyer of dairy products. Eliminating them as a customer will throw off the supply and demand issues already facing the industry. That will continue to drive the price of milk lower.

"This has been a very difficult time," Stephenson said. "No question about it. We have folks that have been working hard for five years who haven't turned a profit or paid their bills in that period of time. It's discouraging for dairy farmers to face that kind of environment."

But dairy isn't the only Wisconsin export impacted.

"Products and trade aren't flowing like they normally do," Stephenson said. "That's a problem and not just for dairy."

"Wisconsin exports over $2 billion in goods and services to China," Tim Sheehy, President of the Metropolitan Milwaukee Association of Commerce said. "Think of Harley, GE, Briggs & Stratton, Johnson Controls. Those companies are impacted by the fact that their manufacturing, their supply chain, and their employees are impacted by this health hazard in China."

Sheehy says the ripple effect could hurt the state's manufacturing industry here at home as well.

"If you're making parts for aircraft engines and the airlines cut off flights for a couple of months, it reduces wear-and-tear on engines," Sheehy said. "Which impacts needs for those parts. That's a longer-term impact. There are all sorts of ways in which this story weaves its way into the economy."

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