As appeared in U.S.News and World Report, June 10, 1996

The Drought of 1996

An on-scene report from last year's dry heartland.

BY WARREN COHEN

Walking through a thick field of wheat just before harvest time is usually a labored process, but Steve Irsik Jr. cuts quickly through the open gaps in his knee-high stalks. These southwestern Kansas plants ought to be as tall as a farmer's belt buckle by now, and Irsik demonstrates why they're stunted. With the tip of his soil probe, a metal rod as long as a pool cue, he pushes into the earth. For every foot he can shove, there is an inch of precious moisture nourishing his wheat. In a good year, the entire 6-foot probe would slide smoothly into the ground like a spoon into a hot fudge sundae. Today, the probe stops just 18 inches deep. In farmer's parlance, Irsik's "bank account," his dirt, is empty.

Hard red winter wheat, used to make bread, rolls and all-purpose flour, grows mostly in western Kansas and Nebraska, eastern Colorado and the panhandles of Oklahoma and Texas, and Irsik is just one of thousands of farmers who are suffering. After this year's crop was planted last fall, an unseasonable March freeze killed some of the seedlings. Fifty mile-per-hour gusts blew dirt against the fragile plants. And instead of its normal rainfall of about 12 inches since March, the area has received no more than 3 inches. The U.S. Department of Agriculture forecasts a 1996 wheat harvest of 1.36 billion bushels, an 18-year low. And for some areas, this is the third straight year of devastating weather.

Domino effect. Last week, President Clinton ordered $70 million in federal aid, mostly for forage growers in Texas and Oklahoma, but the drought already has had a domino effect throughout the rural economy. The poor wheat harvest, along with strong worldwide demand for wheat, has pushed prices beyond $6.50 a bushel, up from the typical $3.50. Prices for corn and other feed grains also have soared.

Cattle need 4 to 5 pounds of grain to add a pound of meat, and many ranchers have found feeding them prohibitively expensive, especially now that the drought has turned grass on grazing land brown and brittle. In Oklahoma, the number of cattle sold for slaughter at the stockyards has nearly doubled. In turn, the oversupply of beef has sent cattle prices to a nine-year low. Up to 10,000 Oklahoma ranchers and farmers could go bankrupt or quit. Texas expects to lose $2.4 billion in crop and livestock production. At a Kansas State University extension program offering financial, legal and stress-related counseling for farmers, calls for help are up nearly 60 percent.

The situation is compounded by the federal government's changing farm policy. Washington has cut its purchases of reserve grain, which once helped stabilize prices during shortages, and U.S. grain stocks are the lowest in 35 years. Last April, the president signed a farm bill ending the government's role in manipulating commodity prices. Most farmers are happy that the bill gives them freedom to plant more acres and to diversify their crops, but the transition to a more free-market system could not have come at a worse time. Traditional disaster payments to farmers have been terminated, but Agriculture Secretary Dan Glickman believes existing federal programs will ameliorate farmers' suffering. His advice to them: Pray for rain. State governments take a similar position. Texas officials are urging rural banks to give farmers more time to repay agriculture loans; the Oklahoma Legislature has approved spending $1 million on an attempt to seed clouds.

"Dirty Thirties." The drought of 1996 has evoked the inevitable comparisons with the notorious Dust Bowl of the 1930s. But aside from dry weather, there are few similarities. The Dust Bowl was marked by "black blizzards" that swirled 8,000 feet high, dust storms that made days as dark as nights. Some areas lost 5 inches of topsoil. By 1936, more than 2 million farmers were drawing relief checks from the government, and as many as 500,000 people packed up their belongings and fled westward.

But since the "dirty Thirties," farming methods have been radically transformed. Then, a harvest would sweep the ground clean like a kitchen floor, leaving bare topsoil exposed and vulnerable to the wind. Today, virtually every farmer practices "trash farming," in which pieces of wheat stalks are left on the soil after harvest to hold the dirt in place and trap moisture. Farmers also allow fields to lie fallow for a season, letting rainfall replenish the dirt. And a post-Dust Bowl government plan, the Conservation Reserve Program, pays farmers to set aside roughly 10 percent of the nation's highly erodible acres, which have now reverted back to natural grassland. Some counties in this region have as much as 25 percent of their land in escrow.

Nor has this drought caused the economic devastation of the 1930s. Before the current weather woes, farmers were in the best financial shape in years. In Kansas, land prices have climbed 5.9 percent from their 1987 nadir. Nationwide, farmers' debt-to-equity ratios have fallen from a high of 29.8 percent in 1985 to 19 percent today, in part because the farm crisis of the 1980s weeded out many inefficient operators.

Managing risk. In addition, many regional economists say today's farmers are better risk managers and more diversified. In Dodge City, Lynn Rice's wheat crop looked so poor that he plowed under all 1,500 acres for the second straight year. Even with crop insurance, Rice says, he won't recover the money he spent to plant the crop. But while 10 years ago he was totally dependent on cash crops, Rice now derives a third of his revenues from a new business, disposing of waste from local feed yards, which should be profitable enough to keep him in the black this year. "You try to have some game plan for alternatives when these things hit," he says.

Despite the stress the drought has caused rural communities, "the U.S. consumer and the economy may not see much effect," says William Tierney, an agricultural economist at Kansas State University. Only about 16 percent of the nation's jobs are farm-related. Though the country's biggest bakeries will have to spend more for grain, wheat accounts for only 10 percent of the retail cost of bread, less than labor, transport or packaging. And if the weather improves, strong worldwide demand for grain may help farmers forget these hard times. The Agriculture Department expects the nation's agriculture trade surplus to hit $30.5 billion this year, a new record.

That sunny assumption, though, requires some wetter weather. Last week, portions of the region received a few thunderstorms, which won't repair damage to the crops but could boost yields of surviving plants. But the Great Plains are still what historian Donald Worster calls "next year" country: "This season the crops may wither and die, the winds may pile up dirt against the barn, but next time we will do better--we will strike a bonanza."


Copyright 1997, U.S. News & World Report. All rights reserved.

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