The 2012 drought and heat storm has inflicted over $1 billion dollars in damages on two million acres planted in 26 counties of far Western Kentucky. A vast region stretching from Owensboro, down through the Green River country over to the lakes and down to the Mississippi river are the fertile gems of West Kentucky agriculture.

This region is the heart of America’s Inland Waterway System where five major rivers meet and converge to create the Mighty Mississippi River. These rivers are (1) Ohio (2) Tennessee (3) Cumberland (4) Clarks and (5) Mississippi. If this system of water ways ever becomes broken or for whatever reason doesn’t function, then America will be facing a national security crisis of unparallel dimensions. As of this writing, some 1,440 counties out of 3,000 in America have become a part of the drought.

For the purposes of this article, traditional damage assessments covering corn, wheat, and soybean are profiled as well as trying to deal with the damages to hay supplies and beef inventories in Western Kentucky.

The National Agricultural Statistics Service (NASS) has indentified these counties into two districts for reporting and geographical sorting. 

District 1 is made up of: Ballard, Calloway, Carlisle, Fulton, Graves, Hickman, Livingston, Lyon,, McCracken, Marshall, and Trigg.  

District 2 is defined by these counties: Caldwell, Christian, Crittenden, Daviess, Henderson, Hopkins, Logan, McLean, Ohio, Simpson, Todd, Union, and Webster.

In good times, this part of Kentucky is flush with bumper crops of corn, soybean, winter wheat, and hay. Now after 11 weeks of blistering 100 degree plus heat has reduced this area to a economic disaster zone.

Below are the results of researching the files of the NASS for indictors as to actual and potential damages from this drought. The targets for this research were confined to the row crops of corn, winter wheat, and soybeans.

A look at the situation with cattle was also taken.

Corn

Corn is planted on 938,500 acres in western Kentucky. District 2 has the most acreage with 684,000 under cultivation. The largest concentration of corn crop in this district is located in the following counties: (1) Daviess with 68,500 acres planted (2) Henderson with 70,500 (3) Logan at 66,000 acres and (4) Union with 75,500 acres. These top four counties contain 280,500 acres or 30% of the total corn crop in District 2.

District 1 corn crop has one county, Graves with a large corn planting at 67,000 acreage.

Drought damage for 2012 is calculated using a base of 938,500 acres times a crop loss factor of 80%. This would mean 750,800 acres of corn value would be loss due to extreme heat.

Figuring the actual monetary value for the corm crop loss is based on using federal data
of a gross returns per acre of $845.00. The potential loss of profit would be based upon a total return above variable costs per acre of $318.

Data is based upon crop reports and budgets for 2012 by National Agricultural Statistics Service.

750,800 acres at extreme risk x $845.00 = $634,426,000 total gross loss value

750,800 acres                 x $318.00 = $241,044,000 total gross profit value
 
Winter Wheat

West Kentucky winter wheat crop has a total acreage of 383,500 acres in 26 counties. Like corn, these counties are grouped into two districts. District 1, has one county with a rather larger crop. That is Graves County with 26,300 acres in wheat.

Just like corn, District 2 winter wheat crop is concentrated in four counties: (1) Christian with 63,100 acres (2) Logan at 47,500 acres (3) Simpson with 30,000 acres and (4) Todd coming is with 33,400 acres. These four counties account for 174,000 acres of winter wheat or 45% of the region total.

Using the same data base as for corn crop, the loss and profit numbers for winter wheat are shown below.

The loss figure for winter wheat is calculated at a rate of 50%. The actual in field loss is based upon a single acre of winter heat having a Gross Return per Acre of $489.00. The value of potential profit loss is based upon a figure of $137.00 per acre.

Total winter wheat 383,500 acres x extreme risk factor 50% =191,750

191,750 acres x Gross Return per Acre of $489.00 = $ 93,765,750   potential value loss

Potential Loss Gross Profit per acre of $137.00 x 191,750 risk acres =$26,269,750

Soybeans

Of the three row crops grown in West Kentucky it is the soybean that has the most acreage. There is over a million acres of soybean in the 26 counties of West Kentucky.

District 1 has 375,000 acres planted in: (1) Ballard 38,800 (2) Fulton, 47,000,
(3) Hickman 48,000 (4) Calloway with 43,800 and (5) Graves with   81,000.  These counties have a total of 258,600 acres or 69% of the market place in far Western Kentucky Soybean District 1.

District 2 has soybean acreage in the counties of (1) Christian with 77,500 acres, (2) Daviess at 74,500 (3) Henderson with 84,000 acres, (4)  Hopkins at 36,500 acres (5) Logan and some 64,500 acres (6) McLean with 47,500 (7) Ohio at 30,800 acres (8) Simpson and 42,500 acres (9) Todd  with 47,500 acres (10) Union with 62,000 and (11) Webster at 41,000 acres. These counties have a total of 608,300 acres or 57% of the soybean crop in District 2.

The loss figure for soybeans is calculated at a rate of 50%. The actual in field loss is based upon a single acre of winter heat having a Gross Return per Acre of $594.00. The value of potential profit loss is based upon a figure of $241.00 per acre.

Total soybean crop 1,059,000 acres x extreme risk factor 50% =529,500 acres

529,500 acres x Gross Return per Acre of $594.00 = $ 314,523,000   potential value loss

Potential Loss Gross Profit per acre of $241.00 x 529,500 risk acres =$127,609,500

Bottom line is that the farmers and small towns of Western Kentucky will experience the loss of $1.3 billion dollars in farm market operational dollars with another potential of over $400 million loss in direct profits. These numbers are only for the crops of corn, winter wheat, and soybeans.

Hay and Beef

At serious risk to the farm community in far Western Kentucky are the great beef and cattle herds. Besides the basic issue of getting water to these herds is the increased cost for food to them. With the hay crop impacted from the heat and drought, food sources and supplies are getting harder to find and afford as prices shoot up on short supplies.

Hay and other forage food stock is increasing at a 20 to 30% cost factor for many cattlemen, hog and chicken famers.

District 1  Cattle Estimates of Existing Inventories

  All cattle and calves  91,800
  Beef cattle               37,300
  Milk cows                   1,300

District 2  Cattle Estimates of Existing Inventories

  All cattle and calves  213,700 
  Beef Cattle               95,700
  Milk cows                   9,600

Regional totals
  All cattle and calves  305,500
  Beef cattle               133,000
  Milk cows                  10,900

If the heat and drought continue, then the West Kentucky cattle stock will be facing, at minimum, a 20 % cut to basic numbers of herds. This would be potentially a loss of over
61,000 cattle.

Summary

This current crisis of a mega drought and heat storm has gone beyond the large scale historical droughts of 1988 and 1956. Conditions are being moved in place where top soil and lack of any moisture in the air may set up harsh soil loss as seen in the 1930’s. This will take place only if this area suffers through three or four more years of these temperatures and lack of rain. This current drought is the third year in a row of extreme heat and drought in this geographical area.