Enquiry about the impact of the COVID-19 crisis on irrigation business around the world

General observations

 

  • The crisis is managed by national authorities in a quite interventionistic manner and without European coordination, but this lack of coordination was not mentioned as an issue. In one Member State, the contradictory instructions from the Government at the beginning of the lock-down was pointed out.  
  • However, in all EU Member States, irrigation even for gardens and parks is considered as part of the agriculture supply chain and therefore as an essential activity: it has been guaranteed or asked to guarantee continuity of work with the application of strict sanitary measures; some restrictions have applied (no work in new installations in Spain; closing of building sites in France)
  • In China or in India no specific measures were taken regarding the agriculture supply chain (In India difficulties of supply even for essential goods have appeared).
  • Whereas the economic situation for Q1 is estimated rather positive, Q2 looks much more uncertain and pessimistic, except in China which went through the lockdown in February and March.

 

Work and employment

 

  • All respondents from the three sectors reported that teleworking/smart working has been organised wherever possible, including for sales forces;
  • One company indicated special flexibility measures taken for people having children at home (due to schools closing)
  • For manufacturing or shipping, special measures have been taken in most countries, including severe physical distancing everywhere, work shifting and, in some companies, work reduction as a result; in some countries, partial unemployment schemes have been implemented; work on manufacturing or construction sites has to be justified by the employer in some countries
  • No one in any of the sectors has laid-off any workforce; no one is planning to do so yet, without being able to exclude it; in some countries specific government plans are expected
  • However short-term contract workers or consultants did not see their contracts renewed  
  • Another issue is reported in one Member State, that of uncertainties over the liability of the employer for non-teleworking staff
  • In China the situation was very specific: people were on New Year’s holidays when the lock-down started, and it then was implemented in a very strict manner; the supply chain was completely frozen from end January until 20 March, but there were no lay-offs

 

Economic aspects

 

  • The general trend is that Q1 has been positive (except in China) and that Q2 looks very difficult even if some hope that Asia will start to recover early - for the few (also from the three sectors) who provide a forecast, it goes between minus 10% and 50% for Q2, but the limited number of respondents does not allow for a real forecast
  • The situation regarding orders is very contrasted throughout the sectors, so that no conclusion can be drawn yet
  • In general, all companies (manufacturers, importers/distributors, installers) are still able to serve their customers
  • No manufacturing company has indicated a major reorganisation of production
  • The supply chain continues to work; one company indicated the decline in raw material costs
  • No-one indicated shortage of inventory

 

Transportation/others

 

  • In general, no major issues have been reported, but some delays and increase in transportation prices have been noted in many Member States;
  • Airfreight inside Europe and with the USA is more problematic;  
  • There is at least in one country the general issue for installers of closed hotels and restaurants, not allowing for the workforce to operate remotely, and for distributors the absence of clients at the moment of delivery.

By Pierre Lucas, EIA Secretary General