The relentless drought that has plagued the Southeast for more than a year now has continued through the fall and winter months.
In a report from late December 2007, the U.S. Drought Monitor stated that pasture conditions in Georgia were 71 percent poor to very poor compared to 69 percent in the previous week. Topsoil moisture in Georgia was also reported 69 percent short to very short throughout the state for the same week.
During the once-in-a-century drought, water levels in Georgia have fallen to record lows with scarce rainfall amounts. These conditions have prompted several counties to impose water-use restrictions to conserve water.
University of Georgia Extension Economists Don Shurley and Nathan Smith recently discussed production decisions and economic repercussions of the drought related to several crop enterprises.
Despite the drought, the estimated 2007 cotton yield (November estimate) is 25 pounds per acre above the five-year “Olympic average yield” of 759 pounds per acre, says Shurley. The estimated 2007 yield, however, is 40 pounds per acre below the 10-year trend yield of 824 pounds per acre.
Georgia farmers are expected to harvest 1.01 million acres of cotton. Based on November 2007 cash prices, the yield loss (estimated as the difference between the trend yield and current USDA estimated actual yield) would be equivalent to approximately $24.5 million in lint income and $3.2 million in cottonseed income, he says.
Yield loss is also felt at the cotton gin, he adds. “Yield loss means less cotton ginned and fewer bales. Losses in ginning and warehouse fees are estimated at $4.3 million. Yield losses due to the drought, on average across the state, will be much less than anticipated,” he says.
However, in addition to any yield impacts, effects of the drought were also felt through higher production costs — most notably an increased number of irrigation applications and increased weed control costs, says Shurley.
“It is estimated that 35 to 40 percent of Georgia's cotton acres are irrigated. The exact amount of increased irrigation application is unknown. At minimum, many farmers had to apply additional irrigation to provide moisture for planting or to assist the crop to emerge after planting. Assuming on average an additional three to four applications, the added cost of irrigation on the 2007 cotton crop is estimated at a minimum of $10.5 million based on University of Georgia crop enterprise budget estimates,” he says.
The major planting time for cotton is early- to late-May, with the crop typically being 50-percent planted by mid-May. In 2007, due to the drought, the crop was only 22-percent planted on May 13, says Shurley.
“The crop is typically more than 90-percent planted by June 1. In 2007, the crop was only 74 percent planted on June 3. Despite the dry conditions and being behind schedule, many farmers still attempted to plant due to uncertainties in prevented planting coverage from crop insurance. Although the crop was delayed in planting due to dry soil conditions, timely rains in June and again late-season in August allowed the crop to progress. The crop, because it was late, also benefited from near-perfect harvest conditions, which allowed late bolls to mature and pick without yield and quality losses,” he says.
Drought often results in lower fiber quality in addition to yield loss, says Shurley, and 2007 was no exception. “Although harvest conditions were good, the drought resulted in fiber quality losses in addition to yield loss. Income lost due to price reductions for fiber quality is estimated at $8.5 million,” he says.
Georgia acreage, he says, declined by 360,000 acres or 26 percent in 2007. “Cotton prices for 2008 are expected to be higher to compete for acreage. Corn did not fair well on non-irrigated acres in 2007. Because cotton preformed much better than expected despite the drought, some non-irrigated acres may shift back to cotton and/or peanuts in 2008. Also, because wheat prices are also high, farmers may consider double-cropping after wheat harvest. Because late-planted cotton performed well in 2007, in farmers' minds this again could favor cotton as the second crop rather than soybeans,” says Shurley.
Georgia's grain and oilseed crops all were planted during a persistent drought in 2007, says Extension Economist Nathan Smith. After March 2, much of the state went two months without much rain before Tropical Storm Barry brought a significant amount of rain.
The Okefenokee Swamp and adjacent forestland caught fire in mid-April, started by lighting, and drought conditions led to 441,705 acres burned in Georgia and another 122,745 acres burned in Florida.
“Growers who farmed in the 1950s commented that the spring of 2007 was the driest they had seen since 1954 when the previous largest recorded fire in Georgia took place in the Okefenokee,” says Smith. “Rainfall in the first five months of 2007 ranged from 8 to 16 inches below normal for south Georgia locations. One north Georgia location was more than 18 inches below normal.”
Farmers faced these conditions, he says, during planting, and by June, expectations of a crop disaster were prominent.
Peanut and corn losses were projected to be significant, with the peanut crop loss given as $92.5 million and the corn crop loss given as $63.1 million, says Smith. These losses were reported by counties assuming yield potential in early June. Several thousand acres of cotton and peanuts were “dusted in” in hopes of rain while several thousand more acres were prevented from planting by the May 31 crop insurance deadline.
“Peanut plantings were well below normal for the entire season and were only 75 percent completed by the end of May. If not for Tropical Storm Barry bringing rain to much of south Georgia on June 2 and June 3, several thousand acres of peanuts would not have been planted at all,” he says.
A total of 530,000 acres of peanuts were planted in Georgia in 2007 and at least 100,000 acres were planted after June 1, according to crop progress. “Any acreage planted to cotton or peanuts after May 31 is discounted in crop insurance coverage for each day past the deadline. Crop insurance companies, the Risk Management Agency and UGA Extension agents and specialists dealt with prevented planting questions and claims that were unprecedented in the South since prevented planting provisions were made available for crop insurance policies,” says Smith.