Storm, Drought Take Costly Toll on Farms

Farm losses from Hurricane Katrina will approach $900 million this year, and the persistent summer drought that plagued the Midwest will cost those farmers about $1.3 billion, the U.S. Department of Agriculture said Tuesday.

“Given the severity of the hurricane, the agricultural losses could have been much greater,” Agriculture Secretary Mike Johanns said in releasing the preliminary estimate.

The estimate doesn’t account for long-term losses from the hurricane, such as damage to barns, equipment buildings, fences and machinery, he said. Neither does it include the cost of degraded farm fields, livestock carcass disposal, power losses and fuel shortages.

The department said cotton production would drop about 4% this year in Alabama and Mississippi, which are important cotton states, and sugar cane production would drop about 9% in Louisiana, a state that would have accounted for about 1.5% of U.S. sugar production.

The estimate includes $30 million in losses to short-term livestock production and $3 million in milk losses to dairy producers, who lost electricity on farms and in dairy plants. About 10,000 cattle were lost, and millions of chickens were killed, the department said.

Hurricane-force winds missed major centers of crop production, and much of the rice, soybean and corn crops in affected states were harvested before Katrina made landfall, the department said. Remaining crops will cost more to harvest because they were flattened.

The agency attributed much of the crop losses to lost horticultural production in Florida and along the Gulf Coast.

The department compared the $900 million in lost production from Katrina with the $20 billion in overall farm cash receipts last year in Alabama, Florida, Louisiana, Mississippi and Tennessee.

Besides losses from Katrina, the preliminary estimates from the department said drought losses would reach $1.3 billion for corn and soybean growers in Arkansas, Illinois, Indiana, Missouri, Ohio and Wisconsin.