The Top 10 Business Stories of 2009

by Arkansas Business Staff  on Monday, Dec. 28, 2009 12:00 am  

Baptist Health Medical Center of Little Rock, for example, had a net income of $36 million in 2007, but in 2008 it reported a loss of $20.5 million. In addition, several Arkansas hospitals in 2009 proved they weren't recession-proof and slashed employees' pay, froze benefits or laid off workers.

No. 3
Agriculture Woes

Climate change remains a political hot potato, but Arkansas farmers can agree on one thing: The climate in 2009 was none too kind to the agriculture industry.

The year began with a massive ice storm, bringing between 3 and 4 inches of freezing rain, sleet and snow to the northern third of the state. The storm caused massive power outages and timber damage and brought business to a standstill.

The storm cut power to about 350,000 homes and businesses, and customers were power for a month. In Fulton County, every single power pole snapped under the weight of the ice. The cost to the electric utilities alone was estimated at $500 million, with the need to replace more than 40,000 poles and 1,500 miles of wire.

The cleanup cost of removing snapped trees was estimated at $125 million. No estimates were available on the resulting losses from closed businesses, but the Arkansas Forestry Commission estimated that the destruction of nearly 5 million acres of timberland cost landowners about $164 million.

In the spring, the rains began. And it rained, and it rained some more and then even more, making for a late planting for farmers. During September and October and into harvest time, the rains came again, cutting crop yield and quality.

In late October, after more than a foot of rain had fallen during the month, Arkansas Farm Bureau President Randy Veach said yield and quality losses for the major row crops could exceed $650 million.

Although the numbers aren't final, economists with the University of Arkansas' Division of Agriculture estimate that this year's heavy rain and flooded fields cost producers $309.3 million. That's a 9.6 percent loss on estimated total gross receipts for corn, cotton, cottonseed, grass hay, rice, sorghum and soybeans. On a per-acre basis, the average loss was $43.

Cotton producers took the biggest hit. Poor yield and quality and additional fieldwork on cotton and cottonseed are estimated to have resulted in a $115.5 million drop in gross receipts. Rice producers saw gross receipts reduced by $50 million. Soybean producers lost an estimated $49 million because of decreased quality and the cost of additional fieldwork.

The record rainfall also led to losses in the production of fruit and timber. The saturated ground made it difficult for loggers to get into the woods, and sawmill owners had to shut down or curtail operations because the loggers couldn't cut. The record rainfall severely curtailed production of blackberries, peaches and grapes.

No. 4
Telecom Transition

 

 

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