Report: Texas farming industry grows in spite of devastating drought

By Betsy Blaney

Cattle gaze out from a pen in a feedlot near Lubbock, Texas, on Dec. 16, 2013. Some Texas cattle producers are beginning a lengthy climb after a brutal and dispiriting stretch of years of drought. Hundreds of thousands of head in the nation's leading cattle producing state were liquidated since 2011, the state’s most intense one-year drought on record. (AP Photo/Betsy Blaney)Cattle gaze out from a pen in a feedlot near Lubbock, Texas, on Dec. 16, 2013. Some Texas cattle producers are beginning a lengthy climb after a brutal and dispiriting stretch of years of drought. Hundreds of thousands of head in the nation’s leading cattle producing state were liquidated since 2011, the state’s most intense one-year drought on record. (AP Photo/Betsy Blaney)

LUBBOCK, Texas (AP) — While the number of farms in Texas rose over a five-year span, the state lost about 200,000 acres of farmland, according to a new federal report released Thursday.

Texas leads the nation with 248,810 farms, up from 247,437 operations in 2007, the U.S. Department of Agriculture’s preliminary 2012 Census of Agriculture report said. Farmland covers about 130.2 million acres in Texas, a negligible drop from about 130.4 million acres in 2007.

Though still in the throes of a multiyear drought during which ranchers sold millions of heads of cattle, Texas also led the U.S. in livestock sales with $18 billion. It was also in the top 10 in total agriculture sales — third with $25.4 billion — and in crop sales, $7.4 billion, good for eighth place.

Texas Agriculture Commissioner Todd Staples, a Republican who’s running for lieutenant governor, said the report is proof Texas economy continues to be strong.

“Texas continues to lead the nation in farm and ranch acreage and even during times of extreme drought, the total market value of Texas agriculture grew by 25 percent from the previous census five years ago,” he said.

The market value of all agriculture products sold in Texas rose by 21 percent over the five-year period.

The U.S. Department of Agriculture’s preliminary 2012 Census of Agriculture report provides national and state-based estimates on the number of farms, how many acres are farmed, the number of farmers and their average age and other statistics. The report, issued every five years, is used in evaluating and implementing agriculture policies and programs.

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A Second Career, Happily in the Weeds


By David Wallis

MARBLETOWN, N.Y. — STANDING at the edge of an overgrown field, Charles Noble, 65, cups his hands around his mouth and yells, “Mooowaaaahhh.” He hopes his bovine impression will motivate 68 cattle to follow him to a nearby creek. His herd is apparently not thirsty, preferring to munch on tall grass.

When Mr. Noble, a retired actuary and school administrator, started Movable Beast Farm with his wife in 2006, he would “get totally freaked out and have a battle of wills with the cows.” Now he reacts with calm and temporarily stops herding to avoid upsetting the animals.

“Stress is the worst thing you can do for them in terms of quality” of meat, said Mr. Noble, a trim, tanned man with a white goatee. He sells grass-fed beef primarily by word of mouth. “In order to make any money in agriculture at this scale, you really need to be direct marketing,” said Mr. Noble, whose company earned a profit for the first time last year.

But money is not his primary motivation. Mr. Noble waited much of his life to realize his cowboy dreams. “When I was younger,” he said, “I never wanted to work inside at a desk,” so, of course, he said, he spent “30 years working inside, at a desk.”

Though new agricultural enterprises typically demand long hours and physical stamina, many retirees turn to farming as a way to keep active and earn an income — or, like Mr. Noble, to at least supplement Social Security. The White House’s 2013 Economic Report of the President notes that “the average age of U.S. farmers and ranchers has been increasing over time.” One-third of beginning farmers — defined by the federal government as having been in business fewer than 10 years — “are over age 55, indicating that many farmers move into agriculture only after retiring from a different career.”

Brett Olson, co-founder of Renewing the Countryside, a nonprofit in Minneapolis, has noticed more gray hair at the New Farmer Summit, a conference for aspiring agrarians. Mr. Olson’s organization offers a workshop at the annual event that it used to call Young Organic Stewards but renamed New Organic Stewards in 2012 to “be more inclusive,” he said.

Local, state and federal programs devote considerable resources to promoting agricultural start-ups. Many states offer preferential tax treatment of farmland. The Lincoln Institute of Land Policy, a nonprofit in Cambridge, Mass., compiles the various tax breaks on its online database.

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New Farm Bill Spells Big Changes for Texas Ag


A field of corn in the Texas Panhandle

photo by: Jerod Foster
A field of corn in the Texas Panhandle

The nearly $1 trillion farm bill passed by the U.S. Senate on Tuesday after years of contentious political fights will bring about major changes for Texas farmers and ranchers, eliminating direct payments to producers in favor of programs that will only compensate farmers if they lose money.

For close to 20 years, agricultural producers across the country have enjoyed direct cash payments each year, regardless of their profits or how many crops were actually planted. Cotton growers in Texas have been some of the biggest beneficiaries, receiving upwards of $3 billion in such payments over the past two decades.

The new farm bill — which now heads to President Obama, who is expected to sign it — eliminates that system. But much of the savings will go to heavily subsidized insurance programs for farmers that could be even more financially beneficial for them. (Cotton growers across the country will still get more than half a billion dollars in “transition” payments in 2014.)

“It’s designed to cost less overall,” said Jason Johnson, an economist for Texas A&M University’s AgriLife Extension Service. “But those intentions have not always worked out in previous years.”

Farmers will now be able to choose between two different crop insurance programs, which trigger payments either when prices dip below a certain level or when their overall revenues drop below a calculated average based on previous years of local crop data. They also have an option to buy supplemental coverage, two-thirds of which will be subsidized by the federal government.

That essentially means that if crop prices are lower than projected, or a weather disaster results in steep revenue losses, the farm bill could be more expensive than expected. “Initially, it very well may mean [larger] payments this year that in the old farm bill would not have been received,” Johnson said.

Johnson said smaller crops, like peanuts or rice, are likely to benefit from a different insurance program than a larger commodity like corn. But farmers have very little time to decide which one they will choose — and they can’t change their mind each year. They’ll be locked into their choice until the farm bill expires in 2018. After Johnson spoke on Tuesday to an audience of about 100 people in Waco on the farm bill’s implications, some producers were still unsure how it would affect their bottom line.

“It’s going to be pretty confusing, I’m sure,” said Don Ramsey, who grows corn, sorghum, wheat and cotton near Waco. “We may lose [our safety net], we may not.”

The direct cash payments were a boon for Ramsey’s farm, he said, especially during the debilitating drought of the past few years. Without them, he said, “how are we going to make it?” Ramsey said he is considering alternative crops that are more drought- and heat-tolerant, like sunflower, but the risk of disease for such a crop is high, and insurance may also be harder to find.

But others said the federal government needs to rein in its spending, and that includes the assistance on which agricultural producers have historically depended.

“I’d just as soon not participate,” said Steve Stiles, who grows a variety of crops and raises cattle about 80 miles northeast of Austin. “I think all of us could be weaned off of it. … The market will tell who has to stay and who has to go to town.”

The mammoth farm bill, which is projected to save $23 billion over the next decade, was held up in large part because of heated disputes over food stamps for low-income Americans. The legislation cuts $8 billion in food assistance over the next 10 years.

Both Texas senators, Republicans Ted Cruz and John Cornyn, voted against the legislation, in part because of its massive price tag.

Cruz said in a statement on Tuesday that the legislation is not really a farm bill but rather a food stamps bill with farm provisions. “We should address the true needs of American farmers, but this bill doesn’t do that,” Cruz said.

Cruz and Cornyn’s opposition to the bill did not bring them favor from the state’s largest agricultural lobbying groups.

“A no vote on this bill accomplished nothing,” Texas Farm Bureau President Kenneth Dierschke said in a statement. “No reforms, no benefit, nothing.” (Several members of Texas’ U.S. House delegation also voted against it, including Republicans Steve Stockman andRandy Weber, and Democrats Joaquin Castro and Sheila Jackson Lee.)

The subsidies for crop insurance have been a flashpoint for criticism from both Republicans and Democrats. In many cases, crop insurance will guarantee more than three-quarters of a farmer’s typical revenue, no matter how much is actually grown. But Democratic Congressman Henry Cuellar of Laredo, who voted for the bill, said it marks a shift in thinking about agriculture in America.

“The good old days where the ranchers and the farmers were sacred cows, I think those days are now gone,” said Cuellar, who represents a sizable agriculture constituency in the Rio Grande Valley. “Everybody’s going to be given the full review up and down to see what’s needed, what’s not needed.”


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How Prop 6 Passed, and What’s Up Next for Water Projects in Texas


Texans overwhelmingly passed a constitutional amendment Tuesday to jump-start financing for water projects in the state: Proposition 6. The plan will take $2 billion in surplus state money (from the Rainy Day Fund) to start a low-interest loan program for water projects in Texas. The measure had widespread support from both sides of the aisle as well as business and environmental groups. It passed with over 73 percent of the vote.

“I couldn’t be more proud of the members of the legislature who worked in a collaborative way on a very positive agenda for planning for our future water needs,” Speaker of the House Joe Straus, R-San Antonio, said at a rally celebrating the amendment’s passage Tuesday evening. “But the people of Texas today validated our good work with an overwhelming vote of support.” Some Libertarian and smaller environmental groups were vocally against the measure.

The creation of the water fund, overseen by the Texas Water Development Board, represents the first time in decades that the state has put significant money towards water infrastructure. The $2 billion approved this week will act like a down-payment on a mortgage that will allow the state to borrow billions more for hundreds of water projects outlined in its official Water Plan. Those projects aim to provide enough water to meet the state’s needs over the next fifty years.

“The problem is, we’ve never funded the water plan,” notes Paul Burka, Senior Executive Editor with Texas Monthly, who has spent decades covering the issue. “We’ve had these huge droughts but we haven’t funded it at all.” That is set to change after this week’s vote.

“It really underscored how precarious our future is when it comes to water, and how crucial it is that we shift towards a more moderate, water-efficient future,” says Luke Metzger, Director of Environment Texas, who supported the measure. Roughly a third of the funding in the programs are set to go towards conservation projects, an aspect of the plan that helped win support from many environmental groups.

The Texas Water Development Board has a few years to figure out how projects will be prioritized and approved, and what kinds of projects will fit the “conservation” label.

“Now the real work begins,” said Ken Kramer, Water Resources Chair, Lone Star Chapter, Sierra Club in a statement. “Texans need to become actively involved in regional water planning and in local government water supply decisions to make sure that the potential for Prop 6 to advance water conservation and enhance water planning is achieved.”

“The people who claimed that this was for conservation were talking about all these great conservation projects,” Linda Curtis, director of the Libertarian group Independent Texans, said at a small rally opposing the measure in Austin Tuesday evening. “Had they prioritized conservation and guaranteed it, we would have been supporting it. Because that’s the best, cheapest way to handle water at this point.”

Linda Curtis of Independent Texans and Jerry Locke of the Texas Drought Project watch the election returns roll in Tuesday evening. Both groups opposed the measure.

Photo by Michael Marks/StateImpact Texas

Linda Curtis of Independent Texans and Jere Locke of the Texas Drought Project watch the election returns roll in Tuesday evening. Both groups opposed the measure.

Another lingering concern will be the amount of power in the hands of three gubernatorial appointees, all tied to Rick Perry.

“The mistake that was made here was that they gave the Governor too much control over this,” Burka of Texas Monthly says. “There’s going to be a lot of suspicion about it, a lot of distrust. I do not trust anything — anything — Rick Perry does.”

There will be an Advisory Committee charged with oversight of the Water Development Board. That committee will be composed of three appointees by the Lieutenant Governor and the Speaker of the House, as well as a spot for the Comptroller. But how exactly that committee will function — and how much power it will have — is an open question, a matter that will occupy the rulemaking process over the next few years. Groups like Independent Texans were against the measure because of what they call the “cronyism” of the new leadership of the Water Development Board.

“This vote marks an important first step in securing our state’s future, but the work is far from over,” Laura Huffman, Texas State Director of The Nature Conservancy, said in a statement. “We will all have to stay engaged as our communities consider strategies and projects for addressing water needs. Tackling conservation first, to reduce our water use in cities, agriculture, energy and industry will be the cheapest and smartest way to stretch our water supplies.”

And as for when the shovels and water-efficient sprinklers come out? That will likely take even longer. The board isn’t set to finalize its process for approving loans until early 2015.


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How You Pay Farmers to Watch Their Crop Shrivel Up and Die

The federal crop insurance program puts farmers in a real bind. And as climate change intensifies, it’s only getting worse.


Eric Herm, 40, unloads non-genetically-modified cotton seed into a storage barn on his 6,700 acre farm in West Texas. Photograph: Ben Depp

In 2011, Eric Herm’s cantaloupes exploded.

A fourth-generation cotton farmer in West Texas, Herm was experimenting with a home garden to help feed his family during the onset of a drought in the area. Blistering heat, including 100-degree days as early as May, was wilting Herm’s cotton—and in the end, it turned his melons into pressure cookers.

Most of Herm’s neighbors have lost their cotton crop the last three of four growing seasons—part of the most severe regional drought in more than 50 years. According to the National Oceanic and Atmospheric Administration, 2012 temperatures in the United States were the hottest in recorded history. And a May 2013 report by the American Meteorological Society’s Journal of Climate concluded that “human-induced climate change” played a statistically significant role in the record-breaking temperatures of 2011, adding that the period from October 2010 to September 2011 “was Texas’s driest 12-month period on record.”

As of October 2013, more than 80 percent of Herm’s neighbors declared their cotton a failure and collected crop insurance claims, subsidized by US taxpayers.

With the exception of scattered irrigation, most farmers in West Texas practice “dryland” farming, meaning they’re entirely dependent on rain. Rainfall on Herm’s acreage had previously averaged 17 inches a year, but in 2011 and 2012 the annual averages were 3 and 8 inches, he said. Even the driest years of the Dust Bowl, which lasted off and on from 1930 to 1940, brought about 9 to 14 inches of rain to Herm’s region, according to Natalie Umphlett of the Nebraska-based High Plains Regional Climate Center.

“In the back of my mind I’m wondering, ‘Where do I go if things get that bad?'” Herm said back in May, while planting for the 2013 growing season. “If we do not make a crop this year, I’m going to have to a real serious look at [the] future.”

The latest news is not reassuring. As of October 2013, more than 80 percent of Herm’s neighbors declared their cotton a failure and collected crop insurance claims, subsidized by US taxpayers.

If recent research by the US Department of Agriculture is any indication, the crop failures will be a sign of the future. In a February 2013 report, the agency rounded up relevant scientific findings from 56 experts from federal service, universities, and nongovernmental organizations. The results cast doubt on the viability of the US heartland in the age of warming—and not just for dryland cotton. “Continued changes by mid-century and beyond,” the report said, “are expected to have generally detrimental effects on most crops and livestock.” Among other problems, “weed control costs total more than $11 billion a year in the US. Those costs are expected to rise with increasing temperatures and carbon dioxide concentrations.”

Interviews with more than a dozen climatologists, agronomists, agro-economists, and agricultural statisticians have generally echoed the USDA’s prognosis: After about 30 years, greenhouse gas concentrations will reach critical enough levels to significantly disrupt agriculture. But even the next 10 years will probably prove challenging for American farmers, because the weather will be more variable. As Columbia University associate professor of international and public affairs Wolfram Schlenker put it, “There’s more certainty that there will be less certainty.”

In any case, taxpayers are on the hook for climate-related disruption of US food production—mainly in annual outlays for crop insurance. In February 2013, the same month that the USDA released its bleak assessment on global warming, the Government Accountability Office released a statement warning about the federal government’s “fiscal exposure to climate change,” including the crop insurance program.

If the current version of the farm bill were extended 10 years into the future, crop insurance could cost $8.41 billion per year.

Based on USDA data, if the current version of the farm bill were extended 10 years into the future, even without expansions under debate, crop insurance would cost $8.41 billion per year, or $84.1 billion total, according to Jim Langley of the Congressional Budget Office. With the expansions the projected costs rise to about $99 billion. And that figure does not account for recent climate-related impacts on crop yields, including the drought of 2011 and 2012 in Texas and the Midwest.

“We treated those two years as outliers,” said Langley. “We don’t explicitly take into account climate change. It’s not like something dramatic is going to happen in next ten years. We assume weather going to be normal.”

To be sure, it’s hard to turn estimates about climate impacts on agriculture, and by extension crop insurance outlays into hard numbers. And there’s no consensus that taxpayers will pay more than projected. Advocates of crop insurance claim that the program works better than disaster relief. “It forces farmers to manage risk before, not after it happens, which saves taxpayers money,” Tom Zacharias, president of National Crop Insurance Services, an industry group, has written.

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Crop insurance becomes bigger target as primary safety net


As crop insurance becomes the warp and weave of the farm safety net, it provides a tempting target for some legislators and numerous organizations who view funding for U.S. farm programs as wasteful and unnecessary.

“If crop insurance becomes the farm safety net, it has to work for the farmer,” says Joe Outlaw, Texas AgriLife Extension economist and co-director of the Texas A&M Agriculture and Food Policy Center.

“When crop insurance becomes the safety net, politics will get into it,” he said, during a risk management panel discussion, part of the second annual Southwest Ag Issues Summit in Oklahoma City.

“One of the biggest challenges I have when traveling across the country is debunking what smart people say about agricultural spending,” Outlaw said.

Chairman of the House Agriculture Committee Frank Lucas, in an interview with Southwest Farm Press, said preserving crop insurance support is a key focus in farm bill debates but adds that crop insurance funds will be about all that’s left for farm program opponents to target in years to come.

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“The cost of crop insurance to taxpayers is grossly overstated,” said Art Barnaby, Kansas State University agricultural economist and a risk management issues panelist. “There is no subsidy but a cost-share program. No cash is transferred unless a farmer has a claim.”

The key issue with crop insurance, Barnaby said, is to protect farmers against catastrophic loss. “That’s why they need government assistance.”

He also noted that farmers have considerable skin in crop insurance purchase. “Premiums in Texas for 2012 amounted to $1 billion,” he said. “Also, when critics complain about the cost to taxpayers, they don’t consider the gain years, only the losses.” Accounting for gains, he said, drastically reduces the amount of taxpayers’ money going into crop insurance.

He took 2009 as an example. The subsidy—or cost share—was $5.4 billion. Losses and claims were negligible, so the program ended up with a $1.4 billion gain from premiums paid. Total cost share from the government was closer to $4 billion.

Also on the panel was Tom Zacharias, president, National Crop Insurance Services (NCIS). “NCIS is the primary service organization for the crop insurance industry,” Zacharias said. “Individual revenue coverage is the bread and butter of the industry, and with 1994 legislation we saw the genesis of the modern crop insurance program.”

The program grew from 182 million policies in 1998 to 283 million in 2012.

Zacharias also responded by letter later in the week to a series of articles published in Bloomberg News that were harshly critical of the crop insurance program. He wrote:

“Over the last decade, elected officials, financial institutions, farm leaders and farmers have reached a general consensus that crop insurance is the best risk management tool available.  That conclusion was reached because crop insurance reduces the risk exposure to taxpayers while requiring farmers to purchase policies with their own money before enjoying the relative protection of insurance.   In short, it forces farmers to manage risk before, not after it happens, which saves taxpayers money.

“The factual errors, blatant omissions and obvious bias in this series were stunning and it is unfortunate that the editors of Bloomberg News agreed to release these stories publicly.  It was a great disservice to their readers and a personal insult to the hardworking farmers and ranchers of this nation.”

Panelists and audience members expressed other concerns for the continued viability of federal crop insurance. Payment limits could be a killer.

“A $250,000 adjusted gross income limit would affect a lot of people in this audience,” Barnaby said. “Adding payment limitations to crop insurance would be a serious threat.”

Zacharias agrees.  “Payment limitations would run head on into farm policy versus risk management. For risk management, we need a high level of participation and payment limitations could reduce farmer participation.”

Outlaw said farmers will have to rethink crop insurance decisions whenever a new farm bill is passed. Recent changes that allow growers to split out coverage for different production practices such as dryland versus irrigated has added some new wrinkles, but proposals likely to be included in new law  may offer even more layers and options that producers will have to weigh.

“Regardless of when a farm bill is done, farmers will see a shift from commodity program risk management tools to more insurance. It’s not necessarily a problem, just different,” Outlaw said. “We will need to engage in a huge education effort to help farmers understand the choices and costs associated with different insurance levels.”

Audience members expressed concerns about recent yield declines—caused by prolonged drought—and the resulting low average production history on which crop insurance coverage and premiums are based.

Panelists said farmers could still buy more coverage but the price would be higher.

Zacharias said ongoing and future challenges for NCIS include product delivery and continuation of premium subsidies. He also noted that producers do share in the cost of their crop insurance and that they receive payments only when they have a loss.

The focus of farm legislation and for the agriculture industry for crop insurance, he said, continues to be, “do no harm.”

Courtesy of Southwest Farm Press

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Overgrazing Turning Parts of Mongolian Steppe Into Desert

Sep. 5, 2013 — Overgrazing by millions of sheep and goats is the primary cause of degraded land in the Mongolian Steppe, one of the largest remaining grassland ecosystems in the world, Oregon State University researchers say in a new report.

Using a new satellite-based vegetation monitoring system, researchers found that about 12 percent of the biomass has disappeared in this country that’s more than twice the size of Texas, and 70 percent of the grassland ecosystem is now considered degraded. The findings were published in Global Change Biology.

Overgrazing accounts for about 80 percent of the vegetation loss in recent years, researchers concluded, and reduced precipitation as a result of climatic change accounted for most of the rest. These combined forces have led to desertification as once-productive grasslands are overtaken by the Gobi Desert, expanding rapidly from the south.

Since 1990 livestock numbers have almost doubled to 45 million animals, caused in part by the socioeconomic changes linked to the breakup of the former Soviet Union, the report said. High unemployment led many people back to domestic herding.

The problem poses serious threats to this ecosystem, researchers say, including soil and water loss, but it may contribute to global climate change as well. Grasslands, depending on their status, can act as either a significant sink or source for atmospheric carbon dioxide.

“This is a pretty serious issue,” said Thomas Hilker, an assistant professor in the OSU College of Forestry. “Regionally, this is a huge area in which the land is being degraded and the food supply for local people is being reduced.

“Globally, however, all ecosystems have a distinct function in world climate,” he said. “Vegetation cools the landscape and plays an important role for the water and carbon balance, including greenhouse gases.”

Even though it was clear that major problems were occurring in Mongolia in the past 20 years, researchers were uncertain whether the underlying cause was overgrazing, climate change or something else. This report indicates that overgrazing is the predominant concern.

Mongolia is a semi-arid region with harsh, dry winters and warm, wet summers. About 79 percent of the country is covered by grasslands, and a huge surge in the number of grazing animals occurred during just the past decade — especially sheep and goats that cause more damage than cattle. Related research has found that heavy grazing results in much less vegetation cover and root biomass, and an increase in animal hoof impacts.


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