Drought Spreads Pain From Florida to Arizona

Although today’s economy is not as bad, many Americans ground down by prolonged economic insecurity have little wiggle room to handle the effects of a prolonged drought. Government agencies are in the same boat.

“Because we overspent, the Legislature overspent, we’ve been cut back and then the drought comes along and we don’t have the resources and federal government doesn’t, and so we just tighten our belt and go on,” said Donald Butler, the director of the Arizona Department of Agriculture.

The drought is having some odd effects, economically and otherwise.

“One of the biggest impacts of the drought is going to be the shrinking of the cattle herd in the United States,” said Bruce A. Babcock, an agricultural economist at Iowa State University in Ames. And that will have a paradoxical but profound impact on the price of a steak.

Ranchers whose grass was killed by drought cannot afford to sustain cattle with hay or other feed, which is also climbing in price. Their response will most likely be to send animals to slaughter early. That glut of beef would lower prices temporarily.

But America’s cattle supply will ultimately be lower at a time when the global supply is already low, potentially resulting in much higher prices in the future.

There are other problems. Fishing tournaments have been canceled in Florida and Mississippi, just two of the states where low water levels have kept recreational users from lakes and rivers. In Texas, some cities are experiencing blackouts because airborne deposits of salt and chemicals are building up on power lines, triggering surges that shut down the system. In times of normal weather, rain usually washes away the environmental buildup. Instead, power company crews in cities like Houston are being dispatched to spray electrical lines.

In this corner of Georgia, where temperatures have been over 100 and rainfall has been off by more than half, fish and wildlife officials are worried over the health of the shinyrayed pocketbook and the oval pigtoe mussels, both freshwater species on the endangered species list.

The mussels live in Spring Creek, which is dangerously low and borders Terry Pickle’s 2,000-acre farm here. He pulls his irrigation from wells that tie into the water system of which Spring Creek is a part.

Whether nature or agriculture is to blame remains a debate in a state that for 20 years has been embroiled in a water war with Alabama and Florida. Meanwhile, Colquitt has allowed the state to drill a special well to pump water back into the creek to save the mussels from extinction.

Most farmers here are much more worried about the crops than the mussels. With cotton and corn prices high, they had high hopes for the season. But many have had to replant fields several times to get even one crop to survive. Others, like Mr. Pickle, have relied on irrigation so expensive that it threatens to eat into any profits.

The water is free, but the system used to get it from the ground runs on diesel fuel. His bill for May and June was an unheard of $88,442.

Thousands of small stories like that will all contribute to the ultimate financial impact of the drought, which will not be known until it is over. And no one knows when that will be.

The United States Department of Agriculture’s Farm Service Agency has already provided over $75 million in assistance to ranchers nationwide, with most of it going to Florida, New Mexico and Texas. An additional $62 million in crop insurance indemnities have already been provided to help other producers.

Economists say that adding up the effects of drought is far more complicated than, say, those of a hurricane or tornado, which destroy structures that have set values. With drought, a shattered wheat or corn crop is a loss to one farmer, and it has a specific price tag. But all those individual losses punch a hole in the food supply and drive prices up. That is good news for a farmer who manages to get a crop in. The final net costs down the line are thus dispersed, and mostly passed along.

That means grocery shoppers will feel the effects of the drought at the dinner table, where the cost of staples like meat and bread will most likely rise, said Michael J. Roberts, an associate professor of agricultural and resource economics at North Carolina State University in Raleigh, N.C. “The biggest losers are consumers,” he said.