Iowa Public Television

 

Great Drought Forces Cattle Sell-off

posted on August 3, 2012


The Agriculture Department announced this week that crop insurance companies have agreed to provide a short grace period for farmers on their insurance premiums.   

Secretary of Agriculture Tom Vilsack asked insurance companies to voluntarily defer the interest on unpaid spring crop premiums until November 1st.   Likewise, USDA will not require the insurance companies to pay uncollected producer premiums until one month later.

That’s at least a tiny bit of good news for corn and soybean producers facing potential cash flow issues this fall.  But fewer livestock producers have coverage and the main federal disaster program for them expired last year.

Paul Yeager examined the impact of drought on cattle producers in Arkansas and Kansas this week and filed this report.  

The Great Drought of 2012 tightened its grip on America this week as more than half of the continental United States have been declared disaster areas by USDA, mainly due to drought and excessive heat.

All told, 1,584 counties in 32 states received the designation, making farmers eligible for low-interest emergency loans.

Meanwhile, the U.S. Drought Monitor reveals arid conditions are intensifying with the vast majority of haying and grazing land locked in the driest conditions in half a century.

Hoping to bring relief to weary livestock producers, USDA expanded emergency haying and grazing on close to 4 million acres of conservation land this week.

Like so many other producers in the south, Arkansas cattlemen are enduring their second straight year of extreme drought.

Gary Rowlands/Pope County, AR “This is the worst year I can remember having been in the cattle business. Last year was a dry year and we lost some of our grasses in the fields, the pasture and hay ground and we cut our herd to some degree last year but nothing like now.”

Fourth-generation farmer Gary Rowlands of Pope County, Arkansas says he’s endured long stretches without rain again this year, on top of several 100 degree days. And like so many other livestock producers, he’s considering selling their cattle, simply because they can’t afford to feed them.

Phil Sims/Pope County Extension Service UA Div. of Agriculture: “Just an incredible amount of cattle going through our sale barns. Our local sale barn is typical of the barn on I-40 there at Ozark, over here at Ola and also at Lewis Auction there at Conway. If you look at the weekly market reports their sale numbers have been double and triple of this time last year.”

And in one of those sale barns, a sale that started at 6 A.M. ran through the night. The reduction in herd size will have long-term impacts for consumers at the meat counter.

Kansas ranchers are also sending cattle to the market during these dry times.

Ken Grecian/Kansas Cattle Rancher: "We probably will sell more pairs and try to keep the core of our young herd as long as we can, I guess if it doesn't ever rain, they'll all end up in town."

Care for those animals left behind is a big task. Water delivery to dried up pastures takes its toll on producers and the livestock. For Ken Grecian, that could be an up to five hour a day job.

Ken Grecian/Kansas Cattle Rancher: "Their water consumption is probably only 20 percent of what we have to haul now. It's time consuming."

Ken Grecian: "I'm starting to lose sleep over this. It's serious enough that we'll have to make hard decisions and making the right call in atmosphere like this is sometimes difficult."

The other big consumer of corn, of course, is  ethanol. This week, the National Cattlemen’s Beef Association asked the EPA to put the Renewable Fuels Standard on hold, saying the mandate is causing “severe economic harm.”

Colin Woodall, National Cattlemen's Beef Association: “We'll pay any price for corn as long as the market is driving that price. But with the renewable fuel standard that’s a government mandate that's driving that price.”

While the window to bring any relief to the corn crop is all but slammed shut, producers for other crops, continue to pray for rain.

USDA’s latest crop conditions report estimated nearly half of America’s corn is in the poor to very poor category.

One-third of the nation’s soybeans garnered similar ratings, tying conditions in 1988. And as if drought wasn’t enough, arid conditions were exacerbated by blistering temperatures.

Brad Rippey/USDA Meteorologist: “We’ve seen record setting July heat stretching all the way from Denver, Colorado, eastward and northeastward into places like La Crosse, Wisconsin, and Rockford, Illinois. Previous records in some of those communities were set for July heat in 1921, 1934, 1936. Some of the historically hot summers of way back in the distant past, and that certainly surpasses what we saw in 1988. On top of that, the very same areas of the plains, mid south, and Midwest had record setting dryness.”


Tags: agriculture Arkansas cattle corn drought ethanol grazing Kansas livestock news soybeans