Drought: USDA throws livestock farmers a lifeline. Will it help?
With the drought sending corn and feed prices soaring, US livestock farmers are bracing for the worst. A $170 million USDA program announced Monday, they say, is too small to make a real difference.
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Experts in the meat business say the difficult times for livestock farmers are likely to force some farmers out of business, especially smaller farmers, and exacerbate the consolidation that has reduced the number of livestock farmers in recent decades.Skip to next paragraph
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Ron Birkenholz, a spokesman for the Iowa Pork Producers Association, says the drought has been especially hard on newer farmers who often get into farming by raising livestock because it requires little investment in land.
“They don’t have anything else to fall back on,” he says.
The USDA last week said its estimate for the US corn crop this year is the lowest since 1995-1996, when far fewer acres were planted: 123 bushels per acre. Traders on Chicago’s commodities exchange, meanwhile, have sent prices for corn and soybean crops to all-time highs.
Like livestock farmers across the US, Tentinger says he’s looked for strategies to weather the tough times. He has sold off some of his animals, culling the less productive ones. He has looked for alternative feeds, like wheat, but their cost is high, too. But unlike cattle, hogs can’t eat grass or the stalks of drought-ravaged corn. They need grain.
“There’s not much out there,” he says.
Mainly he’s decided to cut his losses by selling his hogs sooner: three weeks before they reach full weight. He says he’ll save $12 per animal by spending less on feed.
The USDA program is one of several measures the Obama administration has taken to help out farmers suffering because of the drought. Within the past month the administration has allowed farmers to cut hay on conservation lands to provide forage for their animals.
But the administration has stopped short of granting livestock farmers their key request: a suspension of the federal mandate requiring petroleum refiners to blend about 9 percent of ethanol into their gasoline. Ethanol consumes about 40 percent of the American corn crop, and livestock farmers and their representatives argue that lifting the mandate would lower prices for corn and the feeds made from corn.
Even the UN Food and Agriculture Organization has called for lifting the mandate.
Agricultural economists, however, are skeptical that it would have the desired effect. And corn producers strongly support the mandate and wield considerable political clout in swing states like Iowa.
Catfish farmers have been especially struggling. Competition from imports has already driven many farmers out of business.
Raising catfish right now, Barlow says, “is not even close to break even.”