The Drought of 2012 – What’s the Impact to Livestock Farmers?

This is one of the better looking fields of corn in our area.

This year has been very challenging for farmers and ranchers all over the United States.  Our farm is no different than the majority of farms, we are very, very dry and in need of lots of rain.  Kevin and I do not have a lot of row crop acres to farm but we did rent an extra 200 acres this year.  Needless to say, it wasn’t the best year to double your row crop acres.  We were able to purchase insurance for most of our crops but that alone will not help make our farm payment or equipment payment.

What worries us the most isn’t our own failing crops but the concern of what will we feed the cattle and hogs due to crop failures everywhere?  We can’t just stop feeding them.  Livestock, especially hogs, need row crop farmers to have successful crop years.  Cattle need pasture to graze on and without rain; we have no pastures for grazing or hay.

Hogs are not a ruminant animal, which means they do not have 4 stomach chambers like cattle to digest forage.  Hogs cannot eat forage (grass and hay) for their nutritional needs because they cannot digest the forage with only one stomach.  Hogs need corn and soybean meal to meet their nutritional needs.  These two ingredients are going to be scarce this year due to the drought and that means the price will skyrocket to purchase these key feed ingredients.

Livestock farmers/ranchers do not have insurance programs to help during disaster years like row crop farmers do.  This is something many people, even some farmers, do not know.  When our feed costs get out of control, or when a disease ravages our herd, there is no relief from insurance.  We go to the bank and borrow more money to help pay the bills.  That means another loan payment.

As a hog farmer, I cannot tell the packer what to pay me for my hogs.  We are price takers; supply and demand drive the price we are paid for our hogs.  Just because my cost to feed my hogs is increasing at alarming rates right now doesn’t mean the demand for pork has increased.  When demand increases, or supply decreases, that is when farmers see their markets increase.

Many have asked me why I cannot ‘hang on to the hogs’ and wait for someone to pay me what I need to pay my feed bills.  When a hog is ready to go to market, you have to send it because if it gets too big, the price goes down even more for that hog and your losses increase.  Likewise, you can not sell a hog that isn’t big enough to go to market because the packers will not purchase pigs unless they meet a certain weight requirement.

It’s terrible for row crop farmers when they lose their crops, they are completely dependent on the weather to determine if they will raise a crop or not.  Their livelihood depends on something no one can control, Mother Nature.  That’s why it is so important for row crop farmers to have the ability to purchase crop insurance.  When row crop farmers do not produce a crop, it hurts livestock farmers just as bad, if not worse since we need to buy their crops to feed our animals.  But the pain of the Drought of 2012 doesn’t stop with livestock farmers; it hurts anyone who likes to eat every day.  I think that is the one thing we all have in common, we all like to eat.   So if you haven’t been praying for rain, now might be a good time to start since we all enjoy eating every day!