UAEX Study: Flooding Results in $35.6M in Crop Loss

Flooding in east Arkansas has resulted in $35.6 million in lost crop value and more than 210,000 acres of affected farm land in 10 counties, according to a report released last week by the University of Arkansas System Division of Agriculture.

The full extent of the damage will not be known until after harvest.

The study, conducted by Brad Watkins and Archie Flanders, both professors in the Division of Agriculture, examined damage in Craighead, Crittenden, Cross, Jackson, Lee, Monroe, Poinsett, Prairie, St. Francis and Woodruff counties as a result of flooding that began in June.

In all, the study found 210,400 acres of farmland were affected. The soybean crop was hit hardest, accounting for $28.4 million.

More: View the entire study here (PDF) and an economic analysis here (PDF).

Mark Cochran, vice president of agriculture at UA and head of the UA System Division of Agriculture, said the flooding was not as widespread as in 2011 when $335 million in damage was done, but the timing of this year's floods played a role in the monetary losses.

"The timing of the floods this year occurred late enough that replant options were limited and highly risky," Cochran said in a news release. 

The study also found this year's losses are expected to have an effect on next year's season, as well.

"Value losses in areas susceptible to flooding will negatively impact total farm profitability as commodity prices are decreased in 2014, and producers were already working with diminished profit margin potential," Flanders said in the release. "Value losses will have a negative impact on the producers' ability to repay loans and meet long-term obligations."

Flanders continued that "with prices projected to remain low, losses due to flooding this year could impact the ability of producers to obtain operating loans for the 2015 production year."

The damage was divided into four categories: total loss, costs of replanting the same or less profitable crops, yield losses and increased production costs, and late planting date.

As far as monetary losses are concerned, replanting costs resulted in the largest loss, $18 million, while total loss was $17.6 million.

Followed by the soybean crop, the rice crop saw a $5.6 million loss, corn and sorghum saw a $1.5 million loss and winter wheat saw a $100,000 loss.

Monroe, Poinsett and Woodruff counties all saw losses of more than $4.5 million. Crittenden, Cross, Prairie and St. Francis counties saw losses between $1.5 million and $4.5 million, while Craighead, Jackson and Lee counties saw losses less than $1.5 million.

This year's flooding could also end up affecting whether or not crop insurance indemnities are paid.

"Unlike drought, which can more uniformly affect an entire insurance unit — the acreage covered by crop insurance for a specific crop — flood damage is often more area-specific," Flanders said. "It is possible for a portion of the covered crop acreage to be lost to flood damage without any indemnity payments being triggered."

As an example, Flanders said, "a producer could lose a field of a particular covered crop to flood, but the actual crop yield for the entire insurance unit inclusive of the flood-damaged field could still be high enough not to trigger a crop insurance indemnity."