Economists Put a Figure on South Dakota Storm

US - South Dakota cattle losses are unlikely to have big impacts on national prices for the coming year, possibly increasing finished cattle by 20-30 cents per hundred weight.

23 October 2013

2 minute read

North America

State level impacts, however, are expected to be considerable because of the huge capital losses, emotional strain and disruption to the long term business of rearing cattle.

The ramifications that will be felt by South Dakotans were underscored by Secretary of Agriculture for South Dakota, Lucas Lentsch, in his public address following the extreme storm that swept the state on the 4-7 October.

Mr Lentsch drew attention to the long term impacts that beset ranchers in the state, as well as the huge capital losses and emotional strain.

“The producers who lost livestock in this storm lost more than just the product of one growing season,” he said. “They lost years of work. In many cases, a steadfast commitment over multiple generations to developing their herd’s genetic traits vanished in a matter of hours.”

Mr Lentsch said no rancher can feel guilt for the losses incurred, adding that the storm ‘ambushed’ producers.

Furthermore, he listed other species to perish in the 'indiscrimate' storm, such as the many sheep in the state.

"It took the lives of cattle, sheep, horses, buffalo, deer and antelope," he added.

"Adding to the loss, many ranchers were only days away from marketing their calves, paying their bills and re-investing for the future."

His message for recovery was that aid would be thankfully received following the ‘devastation’ of what is now being dubbed, ‘Winter Storm Atlas’.

Assistance will help the state through a phase in which fences are fixed and cattle are replaced as renderers dispose of carcasses and businesses calculate losses.

To the US cattle sector, the potential losses will not be major, although do come at a time when the herd is at a low ebb and ranchers may be looking at expansion plans.

“Even at 100,000 head of losses, which is the upper end of estimates so far, that represents only one-tenth of one per cent of the nation’s 89 million head of cattle,” stated Professor Chris Hurt, a Purdue Agricultural Extension Economist.

“If one-half of the animals were beef cows that still represents less than two-tenths of one per cent of the nation’s beef cow herd.

“The blizzard losses would be expected to increase finished cattle prices by only 20 to 35 cents per hundredweight over the coming year.”

National Agricultural Advisory Service statistics state that South Dakota’s cow herd was at 1.78 million cows before the storm. This represents 4.62 per cent of the US’s 38.515 million cows.

Losses of this magnitude are huge for individuals, admitted Professor Hurt, but not highly significant for beef supplies on a national basis.