Portraits of the Drought: Declining corn yield affecting Iowa's cattle
Sonny Sporrer, 63, usually raises about 500 head of cattle on his farm in Dedham. That headcount is down by 25 percent this year because his cornfields aren't growing enough food to feed a larger herd.
David Kitt, owner of Kitt's Meat Processing.
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DEDHAM, Iowa -- Sonny Sporrer hasn't been harvesting the corn from his stalks this year. Instead he has been taking the whole plant down and chopping it up for silage, a rough sort of feed for the cattle that usually get grain.
Mr. Sporrer, 63, usually raises about 500 head of cattle on his farm in Dedham. That headcount is down by 25 percent this year because his cornfields aren't growing enough food to feed a larger herd.
The corn yields are down on Mr. Sporrer's farm to an average of 30 bushels an acre, just a sixth of his usual yield of 180 bushels of corn an acre. Some spots are worse than others. In one of his fields, the yield this year was just three bushels an acre.
Farmers throughout the Corn Belt are seeing lower yields because of this summer's intense drought that hit the central plains states the hardest. In Iowa, according to the U.S. Drought Monitor, the entirety of the state is in a "severe" drought, with 58.3 percent of the state experiencing an "extreme" drought. Iowa farmers have reported that just 14 percent of the corn crop is in good condition and only 1 percent is in excellent condition.
As a result, Dedham, a town with a population of 266 that sits in the part of the state designated an extreme drought area, will not be able to fill its community grain elevator this year.
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Roger Shaw, the manager of the Dedham Cooperative Association, where most of the area's farmers store their crops, said in a normal year the cooperative would receive more than 4 million bushels of corn and soybeans, so much that some of it generally overflows into temporary piles outside.
This year, he said, much of the area's corn is being chopped for silage. He hopes the grain elevator will take in at least 1.8 million bushels of corn and soybeans.
Most of the grain farmers in the area have crop insurance that will guarantee them 75 percent of their five-year average. Mr. Shaw said there is no such insurance for the grain elevators.
There isn't any, either, for the meat processors.
David Kitt bought his custom meat company, Kitt's Meat Processing, 10 years ago from his father, who bought it 40 years before that. Kitt's slaughters animals one at a time and then butchers the meat for the farmers who brought the animals in.
Right now, Mr. Kitt is unusually busy. His father and three employees were all working last week to package the meat cut from locally grown cattle. Farmers are cutting their herds to save on the feed.
The flip side is, when that stock is gone, Mr. Kitt is not going to have any business for a while. Farmers won't have the animals to slaughter.
Kitt's Meat Processing is a microeconomic example of what is happening throughout the industry. The Livestock, Dairy and Poultry Outlook, published Aug. 16 by the Economic Research Service of the U.S. Department of Agriculture, said there has been a short-term drop in beef prices because of the farms culling the herds they can't afford to feed.
Prices are expected to go back up and then up some more, rising to about 4 percent above the July 2012 price of beef by July 2013.
Customers may not be seeing the full effect of the drought on meat prices yet. Ken Matthews, an economist with the USDA, said the furor this year over "pink slime" -- a common product in the industry called "lean finely textured beef" and used as an additive -- has helped keep the price of hamburger up. Companies needed a replacement for the product once it became a marketing hazard.
Still, the price of choice cuts dropped from $5.09 a pound in January to $4.93 in June. It rose slightly to $5.01 in July. Mr. Matthews said the price should stay down through the year, possibly rising in the spring when the impact of a smaller meat supply starts to hit.
David Kitt's mother, Theresa Kitt, remembers back in the early 1980s the business went through a similar time. Farmers across the region were going out of business because of the 1980 drought. Mrs. Kitt and her husband, Lenny, had just built a new house in which to raise their seven sons. Deeply in debt from the construction, their processing business dried up.
"I remember, that's when the creeks were dry and the cattle lots cleaned out," she said. "We had to dig into a whole lot of what we had put away."
David Kitt said he is keenly aware of the trouble his family had then, and is socking away the sudden rush of receipts to try to tide the business over the coming lean time.
"I'm kind of going week to week," he said.
The business also makes money butchering meat that it buys from other slaughterhouses and by selling beef sticks and Dedham Bologna. The smoked products give the Kitt's Meat Processing facilities a deep smokey smell.
Mark Mikkelsen is trying to plan ahead, too. He raises pigs with his family, and already had his herd of 6,000 hogs in place when he realized the corn crop wasn't going to be any good this year.
Mr. Mikkelson keeps 700 pigs on his own farm in Dedham and others at his father and brother's places. He said the family had some of last year's feed corn left. They're using that to feed the pigs this year because it makes no sense to slaughter them early.
It's next year that he is not sure of.
While the family is fine now, because it grew enough corn and soybeans to feed its pigs, next year is in doubt because the current corn crop did not pollinate itself during the hot and dry summer weather. The yield in one of the worst spots is down to 14 bushels an acre. By comparison, last year his yield was 212 bushels an acre.
That means they'll need to buy a whole lot of corn next year. It takes a lot of food to get the pigs to full size -- they start at about a dozen pounds each when the Mikkelsen family buys them, and end up 270-pound porkers when the pigs are fully mature and ready to sell.
First Published September 2, 2012 12:00 am