SW Kansas economy could take a hit from drought

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GARDEN CITY, Kan. (AP) — Crop losses linked to severe drought conditions are expected to take a toll on the economy in southwest Kansas.

The Garden City Telegram reported that the Garden City Co-Op is estimating taking about 35 to 40 percent less grain than usual.

Crop insurance will soften the hit. But Garden City Co-Op CEO John McClelland still predicts that businesses that sell such items as trucks, trailers and combines will take a hit.

"Agriculture is the economic engine of western Kansas," he said. "When the farmers have a good year, Main Street has a good year and the co-ops have a good year. It just goes on and on."

Rebecca Davis, director of the U.S. Department of Agriculture's Risk Management Agency in Topeka, said that as of last week, Kansas farmers have insurance claims on more than 308,000 acres of land. Farmers have claimed more than $39 million in wheat indemnities, which is up from $33 million the previous week.

"It's about $5 million a week; it's been jumping," she said.

Some farmers who did manage to raise crops this year had fields stripped away by hail.

Lee Greathouse, a fourth-generation Kansas wheat farmer who farms north of Garden City along U.S. Highway 83, had fields leveled by a hailstorm in mid-June. He estimated that crops that could have brought in about $300,000 would make only $100,000 with crop insurance.

"This is the most devastating storm I've ever seen," he said.

But McClelland, the co-op CEO, said off years are part of the industry.

"In most businesses — in agriculture for sure — you just have to be in it for the long run, and you have to be able to play the averages," he said.

He noted that southwest Kansas is coming off of three or four excellent years, with record-setting harvests.

"So over time, it all averages out," he said. "Hopefully, this drought won't last too long because it's devastating. It's worse than most. But the last three or four years were better than most. It always reverts back to the mean."

Copyright 2011 The Associated Press.

 



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