From: Chris Clayton, Omaha World-Herald
Published September 22, 2005 12:00 AM

Katrina Crop Toll Rivals Drought, Expected To Reach $900 Million

Crop and livestock losses directly related to Hurricane Katrina were estimated Tuesday around $900 million, but drought in parts of the southern and eastern Corn Belt may have done more damage to crops.

Crops such as rice, soybeans and corn in the hurricane-affected states were harvested before Katrina hit, which limited production losses, according to the U.S. Department of Agriculture. The storm destroyed about 4 percent of the cotton crop in Alabama and Mississippi. Louisiana lost about 9 percent of its sugarcane crop, which accounts for about 1.5 percent of the nation's total sugar production.

Livestock producers lost about $30 million. Katrina killed 10,000 cattle and millions of chickens, which affected the broiler and egg industries. Dairy farmers lost about $3 million in milk when farms and dairy operations lost electricity.

The USDA's damage estimates don't factor in the cost of destroyed buildings or equipment, higher fuel costs or power losses along the Gulf Coast.

A damage assessment by the American Farm Bureau Federation pegged Katrina's impact at more than $2 billion.

Drought this year stretching from Arkansas to Indiana and Wisconsin will cost about $1.3 billion in lost corn and soybean production.

Near-record corn and soybean yields nationally, however, mean that the prices received by farmers probably will be low. Shipping problems in New Orleans, the nation's largest grain port, also will suppress prices.

The USDA estimated that up to 95 percent of the planted acreage in hurricane-affected areas is covered by crop insurance. Up to 75 percent of the acres affected by drought is covered.

Sen. Chuck Grassley, R-Iowa, said an overall farm relief package probably will be rolled into an overall bill dealing with Hurricane Katrina recovery. The Senate's farm disaster proposal won't be pegged to the USDA report predicting a near-record harvest, Grassley said.

"We are going to get what we think is fair," he said.

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Source: Knight Ridder/Tribune Business News

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