The Carolinas and Virginia have plenty of hungry livestock mouths to feed and grain growers in the tri-state area did their part in 2012 to fill them with locally grown corn, soybeans, wheat and grain sorghum.
Feed makes up about 70 percent of the cost of feeding livestock, and historically the bulk of this feed has been corn, most of it sent to North Carolina by rail from the Midwest.
With corn prices up to $8 per bushel for much of the year and transportation costs going up to record levels, large livestock integrators are left to ponder the reality of continuing in the livestock business in the region.
North Carolina ranks second in the nation in swine production and it is consistently among the top three poultry producing states in the country.
Add to the equation a long-standing beef cattle industry and a growing aquaculture industry, both with demand for grain for feed, and there is a major shortfall in what is available in the state and region.
There are about 2,200 hog farmers in the state, and about 2,500 poultry farmers.
Hog farmers felt the pinch of high corn prices first, but the state’s booming poultry industry is now feeling the full effect of the high value and scarcity of U.S.-grown corn.
As the 2011 corn is depleted and last year’s corn, at this year’s prices begin to become reality, the high cost of feeding livestock is almost certain to continue.
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Henry Moore, who has 5,000 sows on his farm in Sampson County, N.C., says, “We’ve known for a long time that something like this was coming.”
Moore, who sits on the boards of the North Carolina Pork Council and the National Pork Board, says he has watched closely as ethanol production has taken more of the nation’s corn crop, while stockpiles of corn have been allowed to dwindle, both reckless policies he contends.
“We knew if we had one really bad drought — and we knew we would have one eventually — we’d be in trouble. We’ve been living on borrowed time,” he says.
The ‘grain basin’ for North Carolina’s livestock industry, including North Carolina, upper South Carolina and southeast Virginia continues to ramp up their respective production efforts.
The expected decrease in cotton and peanut acreage, both traditional crops in the region, will likely contribute something close to 200,000 acres of farmland available for grain production in 2013 in the tri-state area.
Advances in crop production technologies both by industry, and by outstanding leadership among Extension grain specialists in the three states, will no doubt keep production on the incline, if Mother Nature cooperates.
How much the grain industry can do, and at what cost to the livestock industry remains to be seen.
Historically, farmers produce what’s profitable and right now grain crops are the hot ticket. For the livestock industry in the region, feeding more local grain may be tantamount to continuing to do business in the Upper Southeast.
Sorghum acreage expanding
In North Carolina, grain sorghum producers alone harvested an extra 60,000 acres (70,000 vs 10,000 in 2011) and produced more than four million bushels of potential livestock feed that wasn’t available in 2011. This year, grain sorghum acreage is expected to top 100,000 acres.
A decade ago most farmers and agri-experts in the state could not have imagined that less than 100,000 acres of peanuts would be planted nor that more grain sorghum than peanuts would be planted in North Carolina, but that’s likely to happen this year.
Veteran North Carolina Department of Agriculture Agronomist Kent Messick says when the final tally on grain sorghum is completed yields will likely average around 70 bushels per acre.
“With an available market in Murphy-Brown willing to buy sorghum for 95 percent of the price of corn, and corn prices hovering around $8 per bushel, most growers are likely to plant more sorghum this year,” Messick says.
“We had some production issues last year, and we saw some fields with weeds and other issues that probably didn’t make much more than 40 bushels per acre. On the other hand we saw plenty of fields over 100 and even 120 bushels per acre,” Messick adds.
He contends one of the biggest jumps in grain sorghum acreage is likely to come from double-cropping it with wheat. Last year some of the best sorghum yields in the state came from fields planted behind wheat.
The other big increase will come from areas in which deer can literally destroy young soybean plants and routinely cause problems in most crops. With grain sorghum, deer tend to nibble on the outside rows, then leave it alone, Messick says.
A limiting factor on the number of grain sorghum acres this year will likely be seed availability.
Ongoing drought problems in the Southwest hurt sorghum seed in terms of both availability and quality last year, and it will likely be a problem this year as more and more growers in the Upper Southeast plant the crop.
Corn is the king of grains for the North Carolina livestock industry, but high prices for corn and even higher prices for transporting it from the Midwest to the state are making it economically difficult to compete for corn for livestock feed.
Grain sorghum helped provide extra grain last year, but so did the state’s corn growers. Last year the average yield of corn was up to 124 bushels per acre, helping push upward the 10-year average, which has hovered between 100-110 bushels per acre for most of the last decade.
Corn acreage in the state was up by 5 percent and production was up by 40 percent, to 95.9 million bushels on 820,000 acres last year.
How much of the extra grain will be used for livestock feed isn’t clear, but with ethanol production in the region virtually non-existent, chances are much of this year’s corn crop will go to feed the feed-challenged poultry and swine industries in the Carolinas and Virginia.
Many North Carolina farmers will do well with corn this year, says Carl Pless, Cabarrus County crops and livestock agent for the North Carolina Cooperative Extension Service.
“Corn was planted last year in places it hasn’t been planted in years, partly because farmers also got a good price for it,” he says.
Livestock demand may push corn acres
The North Carolina Extension agent contends demand for livestock feed alone may push corn acreage up again this year.
“If you’ve got a tremendous yield plus a high price, the math on that works out real well. Corn this year could outpace traditional crops like soybeans and cotton in its importance to North Carolina farmers — it’s going to be a really important crop this year,” Pless concludes.
Soybeans have been a crop superstar in North Carolina for the past several years, taking up more than a million acres annually. The downside of soybean production across the Southeast has been yield drag, when compared to more productive states in the Midwest.
The 10-year average for soybeans in North Carolina is 30 bushels per acre. Last year growers produced 39 bushels per acre (an all time record) on 1.58 million acres. Total production last year was up 49 percent to about 62 million bushels.
North Carolina has a growing soybean export market, so how much of the 2013 production will stay in-state and be used for livestock feed is uncertain.
Over half of the soybeans processed for livestock feed in North Carolina is fed to poultry, about one-quarter is fed to swine, and the rest is used for beef cattle, dairy cattle and pet food.
It is expected that nearly a million acres of wheat was planted in the fall of 2012 in North Carolina, which is a double bonus for the state’s livestock industry.
Wheat is a good, at best, substitute for corn in most livestock rations, but is being used as a feed supplement in both the swine and poultry industries in North Carolina.
Timberlake, N.C., hog producer Tim Thomas says he started feeding wheat back in the summer to try to stretch out his corn supply longer.
“We are going to continue feeding wheat and try to stretch corn out throughout the whole season,” Thomas says.
He adds that there appears to be no end to high corn prices and lack of availability, so wheat may become a more frequent component of his livestock rations.
A more indirect, but potentially bigger benefit to livestock growers of having a record wheat crop in the ground is the opportunity for growers to double-crop. Soybeans is by far the most likely double-crop for wheat, but there is growing interest in adding corn and grain sorghum as the second crop.
The increased grain production in 2012 across the Upper Southeast has not put an end to the feed cost woes of the livestock industry in North Carolina, but it continues to chip away at what has at times been a huge grain deficit.