Western SD worries about drought

Snow storms are causing traffic hazards in the eastern Dakotas this winter, but largely have skipped over western South Dakota.

During a recent CropStop tour, ranchers and farmers to the west expressed concern about the lack of moisture.

Holding out for rain, expecting cow sell-off

EAGLE BUTTE, S.D. -- Troy Vrooman of Eagle Butte, S.D., and his son, Jace, run about 250 cows and farm about 300 acres. "We're sitting in pretty tough shape for this coming year," Troy says. "I think we're going to see a lot of cows selling this spring if we don't get some moisture. The ground's pretty depleted right now. This last year, people kind of got by. We had a lot of marginal hay crops and some pretty decent corn, but we're pretty depleted now for ground moisture."

Farms in the area had quite a bit of hay carryover from previous years.

Vrooman says his pastures are eaten down and in tough shape, but he isn't making any firm cow-selling plans -- yet. "I think a lot of people are holding out, just seeing what happens with the snow and rain; holding on to your numbers as long as you can," Vrooman says.

Minnesota's oldest Charolais breeders

RAPID CITY, S.D. -- Larry Wakefield of Wakefield Farms in New Richland, Minn., showed his polled Charolais cattle at the Iowa Beef Expo in Des Moines after showing them at the recent Black Hills Stock Show in Rapid City, S.D.

The Iowa sale was more affected by drought than the Rapid City sale, says Wakefield, who says his family farm is the "oldest living Charolais breeder in Minnesota," having been at it since 1962. Wakefield is 71 and his two sons, Kyle and Dan, are the third generation on the farm. A granddaughter may be the fourth generation. "She's only a year and a half, but she sure likes cattle," Larry says.

The Wakefields have a 100-cow herd. The home farm is in flat, black-soiled corn and soybean country, but they also have some hillier, sandier soil where they run the cow herds. The Wakefields have shown cattle in South Dakota for 30 years. "It's true cattle country out here," Larry says. "The people who buy any of the bulls are really true cattlemen that know what they're doing."

Beef cattle sales were strong in Rapid City. The Angus sale brought $17,500 for the top bull. "Of course, we always come close to what theirs sell for," Larry says. The top-selling Charolais in Rapid City brought about $16,000.

In Des Moines, the Wakefields had the third-ranking 12-month-old heifer, sired by the national champion, which went for $4,500.

Larry thinks the drought has had an effect on sale values in Iowa. He says Angus, Charolais and Simmental sale values held up well in Rapid City, but some other breeds seemed to drop off.

7 inches in 19 months

QUINN, S.D. -- Randy Clark, 49, of Quinn, S.D., and his son, Hayden, 20, run Clark Ranch 11 miles northeast of Quinn, S.D. The Clarks had been running 400 cows, but slimmed down to 300 cows in late November 2012.

"In this deal, we're going to have to take it as the weather comes," Clark says. "If we don't have good moisture the next couple of months, we'll further reduce the herd. We're all in the same boat, basically. There's going to be a lot of guys that are going to start liquidating herds. We're going to have to have inches and inches of rain and feet of snow to get us out of this deal. It's early yet, but we've got to start getting something soon."

During a blizzard in mid-February, the Clarks were disappointed to end up with less than an inch of snow.

Last winter was the warmest winter on record in the Quinn area, and the driest. In the past 19 months, Clark Ranch has received only about 7 inches of moisture. "It's devastating," Clark says.

The Clarks don't do any farming. They put up hay for a living. "That's our cash crop," Clark says. He's had to buy a lot of hay.

In 2011, the ranch put up 8,000 bales, and none in 2012. He went about 90 miles away to put up a couple of quarters of Conservation Reserve Program hay to get the ranch through the winter.

"We put up a lot of straw about 50 miles away," he says. "That's what's getting us through. If we don't get moisture this year, we don't get a hay crop, I'm going to liquidate the herd -- sell it completely. There's no two ways around that deal."

The family has sold enough cows that Randy can handle more of the operation himself, so his son, Hayden is planning on going to Mitchell, S.D., to power line technician school, as a back-up plan.

The ranch has been in his family since 1907. "This outfit's paid for; that's the sweet deal," Randy says. "You can always buy cows back. Of course, when you go to buy them back, they're always more expensive, but there's nothing we can do about that. And hopefully, we'll have moisture between now and spring."

The next month or six weeks will bring a major turn in the markets, Clark says. The recent bullish cattle-on-feed report and Japanese opening markets to 30-month and younger cattle are two major positives for the market. "The cow herd is at a 60-year low," Clark says. "We should be in the driver's seat. If we get some moisture, we will be."

Planning to plant 'for rain'

PHILIP, S.D. -- Lucas Mayfield, operations manager for CHS elevator in Philip, S.D., says grain handling numbers this fall and winter have made for a good year.

"The winter wheat turned out real good. A lot of guys were worried about it at first, but it come through," Mayfield says, estimating 45 to 50 bushels per acre. Little spring wheat was planted in 2012. Corn yields were down, but the crop has only proliferated in this area in the past three or four years.

"A lot of it was cut for silage," Mayfield says. "Guys fed it. We didn't take in as much grain corn as the (previous) couple years." Prior to 2012, yields were running about 75 bushels an acre.

Philip CHS acquired a new bin site so it was able to take in any grain farmers wanted to deliver at harvest. The elevator can load 35 rail cars at a time on a Canadian Pacific line. The majority is wheat, but there is also some millet and milo. They have a feed mill and most of the corn goes into feed.

Mayfield says everyone tells him they're making cropping plans "as if it was going to rain -- they're planning for rain." The area is above-average for moisture in January and February, but Mayfield hasn't received a lot of snow.

Beef prices buoyed by cow numbers

PHILIP, S.D. -- Thor Roseth, manager of the Philip Livestock Auction, says his regular winter sales on Tuesdays through late February so far have been good.

With the higher price of grain, beef sales had been sluggish in early January.

"There were fewer cattle on feed this year than the year previous and those reports are pretty consistent," Roseth says. The sale on Jan. 29 included 5,000 head of feeder cattle. Most were a little bigger than what had been seen earlier, but still well-received.

"I think with these shorter numbers and looking into the future, I think you'd better own some cattle if you're going to make some money."

Prices for slaughter cows and bulls have been $8 to $10 per hundredweight higher since Jan. 29. Drought is topic one for producers in his area, Roseth says. "They need rain."

They're culling into the cow herd. Many people who would normally run cattle on grass in the spring are selling them earlier, trying to save feed.

Farm equipment sales: so far so good

PHILIP, S.D. -- Crops in Philip didn't come in as they normally do in 2012, with "everything about half," says Joe Woitte, manager of Grossenburg Implement, Inc.

Grossenburg's John Deere stores are headquartered in Winner, S.D., and also include Philip and Pierre in South Dakota. The group also has four stores in Nebraska.

"Fortunately, on some of the crops, the prices were up high enough where it made up some of the difference so it didn't kill us," Woitte says. "The hardest thing (economically) is the cattle and the grass. We're pretty short on grass, having to do a lot of feeding because there's nothing on the ground for them to eat."

The dealership is experiencing reduced sales in hay and loader-type equipment, but crop farming equipment sales have been steady, even with drought. "They got most of the crops out of the field and they have to keep going back with something next year, regardless," Woitte says.

Drought may be holding some people back, but others had a decent year financially, he says.

Farmer interest in farm equipment purchases perked up after Jan. 1, when favorable federal tax policies were implemented.

"Things are going pretty good so far," Woitte says.