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Texas ag losses forecast at record $5.2 billion

By: Associated Press
By: Associated Press

By BETSY BLANEY
Associated Press

LUBBOCK, Texas (AP) -- Texas cattle producers could take several years to fully recover from the drought blistering the state, which agriculture officials estimated Wednesday has caused a record $5.2 billion in livestock and crop losses since last fall.

Officials say producers in the nation's leading cattle state have sent more animals than usual to auction, because there's nothing for them to graze on. That means fewer animals available to buy down the road, and they'll cost more because there will be fewer around.

It will also take time before ranchers will have new animals to sell, said Texas AgriLife Extension Service drought specialist Travis Miller.

"I really expect a three-year recovery in livestock when we start getting rain," he said.

Drought has spread over much of the South this year, setting records from Louisiana to New Mexico. But the situation is especially severe in Texas, the nation's second-largest agriculture state behind California.

Field surveys from November 2010 to Aug. 1 this year indicate livestock losses of $2.1 billion and crop losses of $3.1 billion in the state, extension service economist David Anderson said. By the time crops are done being harvested, it might be more.

"There can still be some losses there when we see what's harvested," Anderson said. "I think it's going to get bigger."

The previous record annual loss was $4.1 billion for the 2006 growing season, Texas agricultural officials said.

Texas leads the nation in cotton and cattle production. But some parts of the state haven't had rain since last fall, and forecasters predict its drought will persist through at least September.

Jim McAdams, a fourth-generation rancher, said demand and prices for beef are up and export markets are thriving, making it an ideal time for ranching - were there any food for animals to graze.

"You would hope that this thing would turn around," he said, adding that fertilizer, fuel and other costs are pulling down ranchers' bottom lines. "We're spending more money to make the same."

The crop losses include about $1.8 billion in cotton, $327 million in corn, $243 million in wheat, $63 million in sorghum and $750 million in lost hay production. The $5.2 billion estimates do not include any losses from fruit and vegetable producers, horticultural and nursery crops, or other grain and row crops.

The estimate also does not include losses from wildfires in the state. Since Nov. 15, state and local firefighters have battled 18,300 fires that have burned a record 3.4 million acres.

The loss estimates, Miller said, were based largely on U.S. Department of Agriculture surveys that he called "pretty conservative."

Texas' corn production is estimated to be down about 30 percent and wheat yields were down from a five-year average of 30 bushels to 26 bushels per acre and crop abandonment was up, Texas agriculture officials said in a statement.

On the South Plains, the world's largest contiguous cotton patch, drought, winds and triple-digit heat doomed producers who rely on rain. Cotton production overall in the region was expected to be down 48 percent from last year.

Some cotton producers who irrigate were even affected and chose to stop doing so, because they might not be able to recoup the money to keep pumping along with their other costs.

Since 1998, drought has cost Texas agriculture $13.1 billion, a figure that does not include the latest loss estimate.

Crops and rangeland across the state have been scorched this year from a lack of rainfall and record triple-digit temperatures. Most of the state has been in the two worst stages of drought since the beginning of May, which means there has been complete or near complete crop failure or no food for grazing livestock.

"We run less cattle and we've had to be very cautious and conservative in the decisions we've made," said McAdams, 61.

There's also not a lot of time before winter wheat in the Panhandle and Rolling Plains is planted in about a month. Ranchers need the rain so their young animals will have something to eat, Miller said.

Texas' economy will take direct hit from the losses. Agriculture accounted for $99.1 billion of the state's $1.1 trillion economy, or 8.6 percent, in 2007, the most recent year such data was available. Losses in that sector have a ripple effect that's about twice the amount of the actual agricultural loss.

Consumers will eventually see the cost of the drought passed on to them, although Anderson has said it's hard to say by how much since processing, marketing, transportation and other costs also play a big role in retail prices.

At this point, Texas would need more than 4.5 inches of rain in the next two months to avoid breaking the 1956 record for driest 12 consecutive months.

While rain is the only thing that's going to bring back growth on grazing lands across the state, Miller said precipitation will bring its own set of consequences.

"It's just bare soil out there," he said. "Rainfall will fill creeks with sediment" from pastures.

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Associated Press writer Betsy Blaney can be reached at http://twitter.com/betsyblaney

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