The vice chairman of the National Cotton Council says the three hurricanes that passed through or near Louisiana’s primary cotton regions in August and September came “at the worst possible time” for his farm and those of his neighbors around Newellton, La.
Testifying at a joint hearing of the Senate Agriculture Committee and the Committee on Homeland Security, Jay Hardwick said Fay, Gustav and Ike probably cost Louisiana’s cotton farmers at least $125 million in yield and quality losses and did similar damage to the region’s corn, soybean and rice producers.
Among Hardwick’s comments:
“My family-operated farm is highly diversified. We produce cotton, corn, grain sorghum, soybean, wheat, specialty crops, and timber in northeast Louisiana. We are also very proud of our conservation and wildlife preservation programs.
“My comments will focus on cotton, but I want to emphasize that no crop was spared damage. As for cotton, the Louisiana State University cotton specialist estimates that over 80,000 acres will not be harvested. On acres that are harvested, yield losses will be high, and quality of the lint and seed will be low. The value of the Louisiana cotton crop will be reduced $125 (million to) $137 million, which is a reduction of 52 to 57 percent.
“The hurricanes also impacted our infrastructure. Cotton gins, warehouses, and grain elevators rely on volume to cover fixed costs and provide jobs. Many gins and warehouses will operate at reduced capacity or not at all in 2008. This means fewer jobs and lower revenues in our rural communities.
“Farmers throughout the United States deal with weather risks such as wind, fire, droughts, pests, freezes, and floods yearly; it’s the nature of our business. Water is not generally a limiting factor in Louisiana agricultural production, (though) the abundance can be. Our annual rainfall is about 58 inches. We received an additional 50 percent over the course of 30 days during August and September.
“Over the years, we have adopted crop practices and management skills to accommodate short periods of excessive rainfall using such Best Management Practices as conservation tillage, enhanced field drainage, erosion control structures, elevated planting beds, diversified crop mixes, and marketing strategies. However, successive tropical storms Faye, Gustav, and Ike and their catastrophic rainfall accumulations simply overwhelmed on our crops, landscape, and management.
“Even though I live 200 miles north of the Louisiana gulf coast, these systems have no boundaries, spare few, and have an extensive reach. The five parish area in which I live was impacted 100 percent. Above average to total crop destruction occurred. And, crop that was harvested has been of extremely poor quality. Neighbors and friends who produce rice, sugar cane, sweet potatoes, peanut, and pecans have suffered incredible losses as well. No such weather event in recent memory has had a greater impact on our crops throughout Louisiana than the combination of Faye, Gustav and Ike.
“I harvest my crops from late July through October. It spreads risk, cash flow, labor, machinery, conservation efforts, marketing, and field preparation for the upcoming year. Faye, Gustav, and Ike came at the worst possible time. I simply couldn’t absorb all three of these storms; neither could my friends and neighbors.
“This production year, even before the storms, had been stressful. We experienced an unusually dry, hot June and July, excessive fuel needs and price, double fertilizer costs, a protracted farm bill process, a worrisome Doha agricultural round, and a commodities market in turmoil. And, in the aftermath of the storms, we will have additional expenses to restore land from a wet harvest and erosion control measures to repair in preparation of the 2009 crop year.
“Salvaged crops are of such poor quality that most crop production is unacceptable to contract buyers. Large domestic and international grain buyers in our area are no longer purchasing or accepting any damage grain against producer contracts. These companies are expecting the contracts to be honored. Only one farmer cooperative is accepting crops.
“Farmers are asking how to meet these contracts and determine ways to meet other financial obligations. So, one can only imagine the shock and awe of what has happened in our area. Having no crop to sell or damaged crop to apply to contracts may initiate an economic disaster perhaps far greater than the weather events alone in Louisiana.
“Some expect crop insurance to provide most of the necessary financial assistance. While almost all cotton acres have some insurance coverage, 54 percent have the minimum coverage known as catastrophic or CAT coverage. This coverage provides minimal benefits only if there are catastrophic losses. Neighboring Catahoula and Concordia parishes were some of the hardest hit parishes. They had only CAT level policies on over 37,000 acres of cotton. I have the same coverage.
“I encourage Congress to develop a plan that will deliver financial assistance to producers in a timely manner. Enhanced crop insurance coverage, timely ad hoc disaster relief, supplemental payments delivered in the same manner as direct payments, and enhancements to the provisions of the permanent disaster programs should all be considered in order to expedite assistance that is commensurate with the losses that have been incurred. Additional funding for existing cost-share conservation programs would help speed restoration of damaged fields. And, I ask you to consider providing some form of financial assistance to gins, warehouses and other key components of our infrastructures that will experience significant financial losses due to sharply reduced volumes.
“The economic losses caused by the hurricanes are dramatic and severe. Timely assistance is needed. Most farmers simply do not have the financial resources to wait until 2009.
“Thank you for your consideration of the views and recommendations presented and giving me the opportunity to present testimony.”