Industry News | August 30, 2012

Nebraska Cattle Farmers Cope With Record-Breaking Drought

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These days, when Nebraska cattle ranchers aren’t tending their crops, breeding their heifers, or fattening up their cows for retailers, restaurants, and consumers worldwide, their eyes are on the sky.

Other than a hailstorm that brought a mere inch and a half of rainfall to the area on the Fourth of July, the ranchers and farmers haven’t seen a good dose of wet weather in more than a year.

Though he’s been through similar droughts in 2000, 2003, and 2005, Shawn Zutavern—a cow/calf operator in Dunning, Nebraska—say’s he’s never experienced conditions this dire.

“We’ve had tough times,” he says, “but nothing like this.”

The drought that’s sweeping most of the nation means not only a shortage of water, but it also means ranchers like Zutavern are struggling to make ends meet and feed their cattle, largely due to skyrocketing feed costs.

The extreme heat conditions and lack of water led many farmers to bring in a lower haul of corn, soybeans, and other crops used to feed cattle.

In addition, Zutavern says the rising cost of corn means it takes more money and energy to get the necessary pounds on the animal—which in turn could negatively affect processing plants, retailers, and even restaurants.

Though the estimated price per bushel for the season was originally predicted to fall between $5 and $6, corn is now selling at a whopping $8 a bushel.

The shortage, combined with higher prices, mean some ranchers will be forced to liquidate their cattle, unless they see a mild winter and a wet spring. Zutavern—who’s a fourth-generation rancher with around 1,500 cattle—says the drought could completely put him out of business.

The price increases could also travel down the line to raise prices for both restaurants and customers—a tough pill to swallow for each party.

Fortunately for consumers and brands, they may not see these effects in the short term. Rich Waller, owner of 37 Cattle Co., a feedlot in Holdrege, Nebraska—says this is partially due to increasing efficiency on both ranchers’ and feedlot operators’ ends.

Waller says that because of underground water sources and irrigation systems, he is fortunate enough to farm in “the garden of the country.”

In addition, efficiencies in feeding—where feedlot operators’ like Waller have begun using products like distilled corn and ethanol byproducts—have made it easier and often cheaper to put pounds on cattle and sell them to beef processors.

Even progress made in the packing industry has resulted in products—like the ground beef that many quick serves use for hamburgers or in beef tacos—having a longer shelf life. Instead of throwing away meats after three days, they can now last three weeks or more, cutting costs for operators and, ultimately, consumers.

By Mary Avant

News and information presented in this release has not been corroborated by QSR, Food News Media, or Journalistic, Inc.