Kay's Korner

May 3, 2013

Weather’s wild impact

Weather extremes have played a huge role in American life from the time the republic was founded. From earthquakes to hurricanes or tornadoes, cities and towns from coast to coast have felt the full force of nature and been reshaped by it. Weather has also been a huge influence in shaping agriculture and modern food production. Just think the Dust Bowl and resultant new techniques to avoid soil erosion.

Just think harsh Midwest winters and the move to rear and finish hogs inside.

Cattle ranching is subject to weather extremes more than any other sector of the livestock industry. Spring blizzards can kill thousands of newborn calves in a matter of days. Summer drought can force cattle to market or slaughter, as has occurred since mid-2010. Most feedlots take numerous measures to protect their four-legged inhabitants. But brutal winter storms, as occurred in 1992-93, can make feedlots vulnerable to added death loss.

Weather certainly separates cattle raising from hog or chicken raising. Cattle might spend up to two-thirds of their life on ranchland or pasture then finish their lives confined in pens but still subject to the elements. Even more than death loss, weather can impact cattle in terms of weight gains and overall productivity. In contrast, most hogs and chickens never see the open sky and are not subject to such production pressures.

Cattle ranchers have done a superb job in combating the vagaries of the weather. They have employed new management systems for their rangeland and made sure not to over-graze when drought hits. But that sometimes means making heartbreaking decisions to cull cows or even disperse full herds. The past two or three years has seen plenty of that, unfortunately.

The decline in beef cow numbers attests to the impact of the most devastating drought to hit Cow/Calf Country in many decades. Due mostly to drought, the largest five cow/calf states in 2012 lost 872,000 beef cows, with Texas leading with a 550,000-head loss. That’s why the number of beef cows on Jan. 1 this year fell below 30 million head for the first time since 1962. That’s why the 2012 calf crop was an estimated 1 million head below the 2011 crop.

Drought impacted the cattle business in another profound way last year. After an almost perfect planting season for the corn crop, USDA forecast a record harvest and corn prices from $4.20 to $4.60 per bushel. But from the end of May on, drought began to ravage the crop. The result was a severely-shrunken harvest and corn prices at $7 or higher. It’s no wonder then that everyone in the industry is looking anxiously at weather forecasts right now. Pasture conditions need to recover as rapidly as possible and the industry desperately needs a record-large corn crop.

This year has so far brought some promise of both. But April’s wild weather showed that Mother Nature isn’t yet prepared to be entirely cooperative. As I write this, parts of the Corn Belt are too dry while other parts a few hundred miles away are flooded. Throw in the colder than normal temperatures and it’s no wonder that corn plantings are off to a slow start. USDA reported that as of April 21, only 4 percent of the corn crop had been planted, compared with 26 percent last year. There’s no panic yet. I’m told that the entire U.S. corn crop could be planted in just a week or so if conditions were perfect everywhere. As analysts have noted, a slow start to the 2009 season did not prevent corn growers from producing a record corn yield of 164.7 bushels per acre.

More serious is that al though the national drought has eased, several key cow/ calf states remain desperately dry. The latest Drought Monitor showed that 47 percent of the contiguous U.S. is in moderate or worse drought, down considerably from 61 percent reported on Jan. 1. Nebraska was the driest state for six months last year. So it’s a relief that the eastern half of the state has had steady rains. But 78 percent of the state remains in extreme or worse drought. Conditions in Kansas have improved more but 57 percent of the state is still in extreme to exceptional drought.

The biggest worry is that Texas’ drought appears to be intensifying, with no end in sight. Texas still has 4.015 million beef cows so that’s ominous news for the entire industry. Any chance of stabilizing and then increasing national cattle numbers might be on hold until 2015 at the earliest.

April’s wild weather also impacted the industry at the consumer end. Cold, wet weather delayed the start to the grilling season, which historically provides the spark to strong beef demand in May and June. This past weekend was expected to be warm and dry. I sure hope millions of Americans fired up their grills and enjoyed a steak or hamburger. — Steve Kay