LITTLE ROCK, Ark. (AP) — Rain has been falling and pastures are greening, but Arkansas agriculture officials say that drought is still a factor that will affect the coming growing season.
Economists with the University of Arkansas Division of Agriculture conducted a preliminary study that estimated the drought's cost to the state cattle industry at $128 million.
The drought actually began in August 2011 and the survey included the months between then and July 2012. It found that 3 percent of ranchers said they planned to sell all their cattle and noted that other costs have yet to be estimated.
Many producers sold more cattle than they'd planned.
Tom Troxel, associate head-Animal Science, for the division, said water resources have yet to be replenished.
"Even though much of Arkansas received much needed rains in August and September, armyworms consumed much of the fresh regrowth," Troxel said. "Many of the ponds and streams are still very low."
It appears to be a little early for ranchers to plunge into the sale barns and start buying calves.
"Drought is a slow long process and so is the recovery," he said. "Is the drought over and is it time to rebuild the cow herd? I don't think so."
But Troxel said ranchers should start planning for how they will rebuild their herds.
He said it is possible to purchase bred cows or cows with calves at their side as many ranches have been selling their livestock.
Troxel said cattle can be either purebred or crossbred but it is important to purchase cows that fit the ranch's environment.
Ranchers could raise heifers, though there is often debate about whether it is best to raise them or purchase adult animals.
"Whether you purchase or raise replacement heifers one must be concerned with genetics, dystocia, or difficulty calving, and cost, and ask whether the heifer fit into your operation," Troxel said.
Producers can also acquire bred cows.
If a bred cow, in last third of pregnancy, is purchased for $1,250, and the operation expects to pay for the bred cow with the net returns of her calves, it will take eight years to pay for the cow, assuming she has a calf every year, he said. If the purchase price is $1,600, it will take 10 years.
Another approach is to buy the bred cow for $1,250 and keep her for five years.
"At the end of five years, sell her with her fifth calf," Troxel said. "This strategy will return 10.4 percent on your money. The same approach used for a $1,000 bred heifer will return 7.6 percent."
Troxel said ranchers have two key questions to consider before rebuilding a herd: "'Have you lost grazeable acres due to the drought?' and 'Is the drought really over?'"