Thursday, August 2, 2012

Drought Results in 1,584 Counties Being Declared Natural Disaster Areas

The ongoing drought has added another 218 counties to the natural disaster list of the U.S. Department of Agriculture, bringing the total in 32 states to 1,584, over half of the counties in those states.

How the USDA determines whether or not to include a county as being a natural disaster is U.S. Drought Monitor. What the designation means for farmers in those counties is being eligible for federal aid.

Agriculture Secretary Tom Vilsack announced that the government will open up as much as 3.8 million acres of conservation land for ranches to use for their livestock.

"The assistance announced today will help U.S. livestock producers dealing with climbing feed prices, critical shortages of hay and deteriorating pasturelands," Vilsack said.

Concerns are the income of farmers will be hit hard, exasperated by the strengthening of the U.S. dollar, which will continue because of the inaction of the Federal Reserve and ECB, which had been expected to take immediate action to stimulate the economy.

That's important because it puts pressure on exports when the U.S. dollar is higher. It also points to how weak the eurozone really is when they've had favorable trading conditions in light of the weak euro.

As for corn, approximately half of the corn crop in the United States is now rated poor to very poor, according to the USDA's National Agricultural Statistics Service.

Soybeans are now under pressure as well, with about 37 percent of the U.S. crop now being considered poor to very poor.

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