Loss to Farmers at $2 Billion

This year’s drought has cost the state’s farmers at least $2 billion, according to Phil Nelson, president of the Illinois Farm Bureau.

Nelson, speaking Tuesday at Agriculture Day at the Illinois State Fair, said that figure could rise by harvest.

"The full impact of the drought on individual farmers will not be known until harvest," Nelson said. "But last Friday’s U.S. Department of Agriculture crop report showed that, as of Aug. 1, drought-related damage has reduced the value of Illinois corn and soybean crops by at least $2 billion from 2004."

Nelson broke the $2 billion figure down into a $1.4 billion loss for Illinois corn and a $690 million loss for beans, at current prices.

"These estimated losses have increased with the relentless heat and scarce rainfall in the first 10 days of August," he said.

To help struggling farmers obtain low-interest loans, Gov. Rod Blagojevich announced the availability of nearly $87 million through the Illinois Finance Authority. Also, as reported in Tuesday’s State Journal-Register, an additional 15,000 acres will be funded by the state for enrollment in the Conservation Reserve Enhancement Program, or CREP.

"Despite recent rainfall, this summer, farmers watched helplessly as their crops withered in the fields," Blagojevich said. "We need to do everything we can to help the farmers pay their bills and feed their families."

Earlier this summer, Nelson and Blagojevich toured drought- ravaged fields to see the extent of the problem. The governor activated Illinois’ Drought Task Force and succeeded in having virtually the entire state declared a federal disaster area. That allowed farmers to apply for a low-interest emergency loan program through Farm Service Agencies.

"Farmers as a whole in the state are suffering," Nelson said. "I’d say six months from now, when farmers start to look at what a tight squeeze their cash flow is, it could be worse. A lot of farmers now are still trying to guess how hard they’ve been hit.

"One guy, who already tried harvesting, thought his corn crop would make 145, and it was 90 bushels per acre. I think a lot of guys are going to find that.

"The outside rows are misleading until you get 32 rows in and see how bad it is," Nelson added. "I think we’ll see yields that range from zero to 150 bushels, like we did in 1991. There will be a lot of fluctuations."

The $2 billion drought cost justifies releasing more agricultural acreage for CREP, Nelson said. The federal-state initiative pays farmers not to use environmentally sensitive land in the Illinois River watershed in order to improve water quality and wildlife habitat.

"If the $87 million isn’t enough, we’ve got more options," Blagojevich said of the Illinois Finance Authority loans. "We’ll go to the federal government and get more help. We’ll do what we have to do to help farmers."