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Drought Causes Record Losses for Texas Agriculture in 2011

In a report released today by the Texas AgriLife Extension, losses for Texas Agriculture due to last year’s drought was a record $7.62 billion.

“2011 was the driest year on record and certainly an infamous year of distinction for the state’s farmers and ranchers,” said Dr. David Anderson, AgriLife Extension livestock economist. “The $7.62 billion mark for 2011 is more than $3.5 billion higher than the 2006 drought loss estimates, which previously was the costliest drought on record. The 2011 losses also represent about 43 percent of the average value of agricultural receipts over the last four years.”

“No one alive has seen single-year drought damage to this extent,” said Dr. Travis Miller, AgriLife Extension agronomist and a member of the Governor’s Drought Preparedness Council. “Texas farmers and ranchers are not strangers to drought, but the intensity of the drought, reflected in record high temperatures, record low precipitation, unprecedented winds coupled with duration – all came together to devastate production agriculture.”

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“When you are one of the biggest agricultural producing states in the nation, a monumental drought causes enormous losses,” Texas Agriculture Commissioner Todd Staples (pictured) said. “While the pain and damage this drought has caused cannot be overstated, our state’s farmers and ranchers are determined in their commitment and fierce in their resolve. We will rebuild and continue delivering the safest, most reliable and most affordable food supply in the world.”

Through August of 2011, AgriLife Extension economists previously reported $5.2 billion in drought losses. The following are updated drought losses for 2011 by commodity with previously reported loss estimates from August in parenthesis:

Livestock: $3.23 billion (up from $2.06 billion);
Lost hay production value: $750 million (no change);
Cotton: $2.2 billion (up from $1.8 billion);
Corn: $736 million (up from $409 million);
Wheat: $314 million (up from $243 million);
Sorghum: $385 million (up from $63 million);

The following are summaries by specific commodities, compiled by the Texas AgriLife Extension:

Livestock – Losses due to the 2011 drought are estimated to be $3.23 billion. The estimate includes the previously reported $2.06 billion in August.

“Losses include the increased cost of feeding livestock due to the lack of pastures and ranges, and market losses,” Anderson said. “Market losses include the impact of fewer pounds sold per calf and the impact of relatively lower market prices due to the large number of cattle sold in a very short time period.”

Cotton – Texas cotton growers faced unprecedented impacts from drought in 2011, according to Dr. John Robinson, AgriLife Extension Service cotton marketing economist.

“In August, the U.S. Department of Agriculture projected a relatively low average cotton yield of 636 pounds per harvested acre, which they subsequently revised down to 557 pounds per acre by December,” Robinson said. “In Texas, cotton growers saw a historically-high acreage abandonment of 55 percent of planted acres. Compared to five-year average yields and abandonment, 2011 represents a huge loss in potential production.

“Applied to USDA’s measure of 7.57 million planted cotton acres in Texas, and valued at USDA’s projected price of 91 cents per pound, this loss adds up to $2.2 billion (up from the August estimated loss of $1.8 billion). It is noteworthy that $1.8 billion is also the 10-year average total value of cotton lint and cottonseed production in Texas. Therefore, Texas cotton growers lost more market income in 2011 than they would normally make for an entire cotton crop.”

Grains and Hay – The drought of 2011 lowered grain production in Texas to about half of normal levels and is estimated to have cost wheat, corn, and sorghum grain farmers in Texas over $1.4 billion.

“Recent production revisions by the USDA lowered harvested acres and yields, and resulted in a doubling of the August loss estimate of $600 million,” said Dr. Mark Welch, AgriLife Extension Service grains marketing economist.

Sorghum – Since August, Texas grain sorghum harvested acres have been reduced by an additional 150,000 acres. Texas grain sorghum production is estimated at 56.4 million bushels compared to a five-year average of 119.5 million, down 60 percent.

“The 1.6 million acres planted in the Spring of 2011 was the fewest in Texas’ history,” Welch said. “Then the drought further lowered yields and raised abandonment rates. The combination of yield losses and reduction in harvested acres put Texas grain sorghum losses at $385 million.”

Finally, here is a list of economic drought losses from 1998 through 2011, as compiled by AgriLife Extension economists:

* 2011– $7.62 billion

* 2009 – $3.6 billion

* 2008 – $1.4 billion

* 2006 – $4.1 billion

* 2002 – $316 million

* 2000 – $1.1 billion

* 1999 – $223 million

* 1998 – $2.4 billion

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