Texas producers face challenges
Portions of the southern United States are burning up, and millions of acres have already been torched by the wildfires that have engulfed multiple states across the southwest.
Luckily for residents of 213 counties in Texas and 32 other counties across Arkansas, Louisiana, New Mexico and Oklahoma, as of June 27 a reprieve was granted, as Secretary of Agriculture Tom Vilsack and President Obama declared them Natural Disaster Areas, which not only entitles farmers and ranchers to fencing assistance, but their disaster area declaration also entitles them to low interest emergency (EM) loans from the USDA’s Farm Service Agency (FSA).
Another program that the USDA has available to assist southwestern producers is the Supplemental Revenue Assistance Program (SURE), and FSA has also granted permission to 76 Texas counties to start using Conservation Reserve Program (CRP) acres for grazing. These, among other financial assistance programs provided by the USDA, will allow many farmers and ranchers to hold onto their operations and livelihoods.
Whereas these programs will be enough to help some production agriculturalists to financially survive the worst drought in over 100 years, for some it’s not enough, and some ranchers cannot afford to feed their animals as the drought has consumed 11.7 percent more land in the last year than was previously affected.
According to Oklahoma State University Cooperative Extension livestock marketing specialist Derrell Peel, if the national rates of beef slaughter are compared to the rates of areas affected by the drought, the difference is drastically noticeable.
“At a minimum, Region 6 beef cow slaughter at the same rate relative to the cow herd as last year – which implies additional herd liquidation – would suggest about 49,000 fewer head than last year,” he says. “Without the drought, the national slaughter rate would be down 7.7 percent compared to the observed rate of 4.4 percent for the year to date.”
Texas is the largest producer of slaughter cattle in the nation, and the toll the drought has taken is shown exponentially through slaughter data across the board.
“Projecting the current rate of slaughter for the southern Great Plains states for the rest of 2011 would result in a national beef cow slaughter rate that decreases only three percent,” adds Peel.
The increased slaughter number ultimately means less herd retention and less expansion within the cattle industry.
“My early projections showed that it might have been possible to stabilize the beef herd this year, but only under the most favorable circumstances. Even without a drought it was likely that the U.S. cowherd could easily decrease another 0.5 to one percent in 2011. Depending on how much additional drought liquidation occurs, beef herd liquidation upwards of two percent is increasingly likely,” explains Peel.
The immediate emphasis is finding a solution to the short-term problems. However, producers cannot easily dismiss the effects that this drought can have on their cattle herd into the future.
“However, the additional herd liquidation will extend and exaggerate the current reduced animal inventories by at least another year,” says Peel.
Peel also predicts the growth rate of herds will be limited when they do start to expand again, which also makes it increasingly likely that any significant herd rebuilding will take at least four to six years.
For some agriculturalists and production operations across the southwest, salvation and reprieve from the financial burdens may be within grasp, but for many others, the end of their livelihoods is in sight. Cattle markets are down for the time being, and fires keep burning up viable crop and pasture lands.
“Please, just pray for rain,” comments Texas Governor Rick Perry.