U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001

87–563 PDF 2014

S. HRG. 113–245 

DROUGHT, FIRE, AND FREEZE: 

THE ECONOMICS OF DISASTERS FOR 

AMERICA’S AGRICULTURAL PRODUCERS 

HEARING 

BEFORE THE

COMMITTEE ON AGRICULTURE, 

NUTRITION AND FORESTRY 

UNITED STATES SENATE 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

FEBRUARY 14, 2013 

Printed for the use of the 

Committee on Agriculture, Nutrition and Forestry 

( 

Available via the World Wide Web: http://www.fdsys.gov/ 

COMMITTEE ON AGRICULTURE, NUTRITION AND FORESTRY 

DEBBIE STABENOW, Michigan, Chairwoman 

PATRICK J. LEAHY, Vermont 

TOM HARKIN, Iowa 

MAX BAUCUS, Montana 

SHERROD BROWN, Ohio 

AMY KLOBUCHAR, Minnesota 

MICHAEL BENNET, Colorado 

KIRSTEN GILLIBRAND, New York 

JOE DONNELLY, Indiana 

HEITKAMP, HEIDI, North Dakota 

COWAN, WILLIAM ‘‘MO’’, Massachusetts 

THAD COCHRAN, Mississippi 

MITCH MCCONNELL, Kentucky 

PAT ROBERTS, Kansas 

SAXBY CHAMBLISS, Georgia 

JOHN BOOZMAN, Arkansas 

JOHN HOEVEN, North Dakota 

MIKE JOHANNS, Nebraska 

CHARLES E. GRASSLEY, Iowa 

JOHN THUNE, South Dakota 

CHRISTOPHER J. ADAMO, Majority Staff Director 

JONATHAN W. COPPESS, Majority Chief Counsel 

JESSICA L. WILLIAMS, Chief Clerk 

THOMAS ALLEN HAWKS, Minority Staff Director 

ANNE C. HAZLETT, Minority Chief Counsel 

(II) 

(III) 

C O N T E N T S 

Page 

HEARING(S): 

Drought, Fire, and Freeze: The Economics of Disasters for America’s Agricultural Producers ..................................................................................................... 1 

Thursday, February 14, 2013 

STATEMENTS PRESENTED BY SENATORS 

Stabenow, Hon. Debbie, U.S. Senator from the State of Michigan, Chairwoman, Committee on Agriculture, Nutrition and Forestry ............................ 1 

Cochran, Hon. Thad, U.S. Senator from the State of Mississippi ....................... 3 

Witnesses 

Pulwarty, Roger, Director, National Integrated Drought Information System, 

National Oceanic and Atmospheric Administration, Boulder, Colorado ......... 5 

Glauber, Joe, Chief Economist, U.S. Department of Agriculture, Washington, 

DC .......................................................................................................................... 7 

LaSalle, Leon, Rancher, Havre, Montana .............................................................. 27 

Steinbarger, Anngie, Farmer, Edinburgh, Indiana ............................................... 29 

Send, Jeff, Cherry Farmer, Leelanau, Michigan ................................................... 30 

Steffen, Ben E., Farmer, Steffen Ag, Inc., Humboldt, Nebraska ......................... 32 

APPENDIX 

PREPARED STATEMENTS: 

Boozman, Hon. John ........................................................................................ 42 

Brown, Hon. Sherrod ........................................................................................ 44 

Cochran, Hon. Thad ......................................................................................... 45 

Thune, Hon. John ............................................................................................. 46 

Glauber, Joe ...................................................................................................... 47 

LaSalle, Leon .................................................................................................... 74 

Pulwarty, Roger ................................................................................................ 78 

Send, Jeff ........................................................................................................... 98 

Steffen, Ben E. .................................................................................................. 112 

Steinbarger, Anngie .......................................................................................... 117 

DOCUMENTS SUBMITTED FOR THE RECORD: 

Stabenow, Hon. Debbie: 

Various organizations representing U.S. farmers and ranchers, prepared 

statement .............................................................................................................. 124 

National Association of Concervation Districts, prepared statement .................. 125 

QUESTION AND ANSWER: 

Stabenow, Hon. Debbie: 

Written questions to Joe Glauber ................................................................... 128 

Written questions to Roger Pulwarty ............................................................. 128 

Roberts, Hon. Pat: 

Written questions to Joe Glauber ................................................................... 140 

Bennet, Hon. Michael: 

Written questions to Jeff Send ........................................................................ 130 

Written questions to Anngie Steinbarger ....................................................... 129 

Page

IV 

Brown, Hon. Sherrod: 

Written questions to Joe Glauber ................................................................... 131 

Written questions to Roger Pulwarty ............................................................. 131 

Cochran, Hon. Thad: 

Written questions to Joe Glauber ................................................................... 133 

Written questions to Roger Pulwarty ............................................................. 134 

Written questions to Ben E. Steffen ............................................................... 134 

Gillibrand, Hon. Kirsten: 

Written questions to Joe Glauber ................................................................... 135 

Written questions to Ben E. Steffen ............................................................... 137 

Heitkamp, Hon. Heidi: 

Written questions to Joe Glauber ................................................................... 139 

Thune, Hon. John: 

Written questions to Joe Glauber ................................................................... 141 

Written questions to Leon LaSalle .................................................................. 142 

Written questions to Roger Pulwarty ............................................................. 141 

Written questions to Jeff Send ........................................................................ 142 

Written questions to Anngie Steinbarger ....................................................... 142 

Glauber, Joe: 

Written response to questions from Hon. Debbie Stabenow ......................... 143 

Written response to questions from Hon. Thad Cochran .............................. 146 

Written response to questions from Hon. Sherrod Brown ............................ 153 

Written response to questions from Hon. Kirsten Gillibrand ....................... 156 

Written response to questions from Hon. Heidi Heitkamp ........................... 162 

Written response to questions from Hon. Pat Roberts .................................. 164 

Written response to questions from Hon. John Thune .................................. 166 

LaSalle, Leon: 

Written response to questions from Hon. John Thune .................................. 169 

Pulwarty, Roger: 

Written response to questions from Hon. Debbie Stabenow ......................... 170 

Written response to questions from Hon. Thad Cochran .............................. 174 

Written response to questions from Hon. Sherrod Brown ............................ 175 

Written response to questions from Hon. John Thune .................................. 178 

Send, Jeff: 

Written response to questions from Hon. Michael Bennet ........................... 187 

Written response to questions from Hon. John Thune .................................. 187 

Steffen, Ben E.: 

Written response to questions from Hon. Thad Cochran .............................. 188 

Written response to questions from Hon. Kirsten Gillibrand ....................... 188 

Steinbarger, Anngie: 

Written response to questions from Hon. Michael Bennet ........................... 199 

Written response to questions from Hon. John Thune .................................. 199 

(1) 

DROUGHT, FIRE, AND FREEZE: 

THE ECONOMICS OF DISASTERS FOR 

AMERICA’S AGRICULTURAL PRODUCERS 

Thursday, February 14, 2013 

UNITED STATES SENATE, 

COMMITTEE ON AGRICULTURE, NUTRITION AND FORESTRY, 

Washington, DC 

The committee met, pursuant to notice, at 9:39 a.m., in room 

328A, Russell Senate Office Building, Hon. Debbie Stabenow, 

Chairwoman of the committee, presiding. 

Present or submitting a statement: Senators Stabenow, Baucus, 

Brown, Klobuchar, Bennet, Donnelly, Heitkamp, Cowan, Cochran, 

Roberts, Chambliss, Boozman, Johanns, Grassley, and Thune. 

STATEMENT OF HON. DEBBIE STABENOW, U.S. SENATOR 

FROM THE STATE OF MICHIGAN, CHAIRWOMAN, COMMITTEE ON AGRICULTURE, NUTRITION AND FORESTRY 

Chairwoman STABENOW. So, good morning again, and it is, in 

fact, my pleasure to call to order this first meeting of the committee. 

First of all, we do not see Senator Roberts here, but as Senator 

Roberts becomes Ranking Member of the Rules Committee and we 

wish him best in this new assignment, I am very pleased to welcome our new Ranking Member, Senator Cochran, who, frankly, is 

no stranger to this committee, who has sat in this chair, whose 

painting is on the wall. We appreciate that it must be an interesting feeling, to be as we have for a number of our members, Senator Chambliss, as well, to have served in a number of capacities. 

We are very pleased to have the expertise of Senator Cochran joining me as a partner in leading the committee. We appreciate your 

years of service and your insight. 

We also are welcoming three new members to the committee, 

Senator Donnelly, Senator Heitkamp, Senator Cowan. We welcome 

all of you, and are looking forward to your hard work on the committee. We know you all are very interested and committed to agriculture. So it is great to have you with us. 

Moving to the hearing topic, nobody feels the effect of weather 

disasters more than our nation’s farmers and ranchers, as we all 

know, whose livelihoods depend on getting the right amount of 

rain, the right amount of sunshine, getting it all together the right 

way at the right time. All too frequently, an entire season’s crop 

can be lost, as we know. Or an entire herd must be sent to slaughter due to the lack of feed. 

2 

The year 2012 was a year of unprecedented destruction, from 

drought, freezes, wildfires, hurricanes, and tornadoes, including the 

tornadoes that hit Mississippi and other parts of the South last 

weekend, and my heart goes out to all the survivors of those devastating storms. Our country experienced two of the most destructive hurricanes on record last year, Isaac and Sandy. 

We experienced the warmest year on record ever in the contiguous United States, which, coupled with the historic drought, produced conditions that rivaled the Dust Bowl. Wildfires raged in the 

West. In the Upper Midwest and Northeast, warm weather in February and March caused trees to bloom early, resulting in total 

fruit destruction when temperatures dropped down to the 20s again 

in April, and we certainly were hit hard with that in Michigan. 

California and Arizona experienced a freeze just last month, threatening citrus, strawberries, lettuce, and avocados. We learned last 

week that our cattle herd inventories are the lowest in over six decades, which has had broad-ranging impacts, including job losses in 

rural communities as processing facilities and feedlots idle. 

The drought has left many of our waterways with dangerously 

low water levels. Lake Michigan, Lake Huron have hit their alltime lowest water levels. Barge traffic on the Mississippi, our most 

vital waterway has nearly ground to a halt. We have seen major 

disruptions and increased transportation costs for commodities and 

fertilizers. 

Today, we will hear from officials at the National Oceanic and 

Atmospheric Administration, NOAA, and the Department of Agriculture about the disasters we faced last year. We also will hear 

directly from those affected by these disasters. 

Thanks to our successful Crop Insurance Program, many farmers 

will be able to recover their losses. For those farmers who did not 

have access to crop insurance or the other risk management tools 

we worked so hard to include in our Senate-passed farm bill, the 

future is less certain. Unfortunately, instead of a farm bill that 

gave those farmers certainty, we ended up with a partial extension 

that creates the haves and haven’ts. Low crop producers that participate in crop insurance not only get assistance from crop insurance, which is essential, but some will continue to receive direct 

payments, as well, regardless if they have a loss. Meanwhile, many 

livestock producers and specialty crop growers who suffered substantial losses will not receive any assistance. 

We all know that farming is the riskiest business in the world 

and altogether employs 16 million Americans. This is important. 

Mother Nature certainly made sure that we did not forget the fact 

that it is the riskiest business last year. 

We need—and we know because we are committed on this committee—we need to give producers the tools to manage the risks 

from those weather events and other risks. We need to give them 

certainty so they can make plans for their businesses. That is why 

we are committed to work together again to lead the way in passing a five-year farm bill. 

This committee did not shrink from its responsibility last year 

nor will we this year. We did our work. We came together in a bipartisan way to pass a farm bill that gives certainty to rural America while reducing our deficit. We passed a bill that gave farmers 

3 

the risk management tools they need to protect against disasters, 

as well. 

So I want to thank my colleagues on the committee for the work 

that we did last year. Working together, I am very confident that 

we will again come forward with a farm bill that provides certainty 

to rural America that is desperately needed. 

I would now like to turn to my good friend and Ranking Member, 

Senator Cochran, for his opening remarks. 

STATEMENT OF HON. THAD COCHRAN, U.S. SENATOR FROM 

THE STATE OF MISSISSIPPI 

Senator COCHRAN. Madam Chair, thank you very much. I again 

am pleased to join you in welcoming the members of our committee 

to our initial hearing and meeting today. 

We are here to learn more about how we can respond to the 

drought and other disaster events of recent years. We would like 

to express appreciation to all the members of the committee and especially to the members of our staffs who are working to help prepare for hearings such as this and our meetings so that we can respond to the interests of American agriculture in an efficient, 

thoughtful, understanding and helpful way. 

It is an honor to serve as the Ranking Member of this committee. 

It has a great tradition of service in its membership, from leaders 

of the Senate that go back all of my lifetime. The room is, of course, 

decorated with a lot of portraits around here. I did not know—I am 

glad that you do not have to be dead to get your picture on the 

wall. That is a nice touch. 

[Laughter.] 

Senator COCHRAN. But we are here to learn from our witnesses, 

and so I am going to ask that my full statement be printed in the 

record and express the hope, again, that our good work can result 

in a strong and robust safety net being created for our farmers. 

That is important to the United States economy. to our producers, 

and our exporters. We can gain from today’s witnesses’ ideas and 

suggestions about how we can improve our response to these needs, 

and I appreciate all of them being here to work with us in this regard. 

Again, Madam Chair, I am looking forward to working with you 

and all the members of the committee as we move forward in the 

113th Congress. 

[The prepared statement of Senator Cochran can be found on 

page 45 in the appendix.] 

Chairwoman STABENOW. Thank you very much. 

We have a group of excellent panelists today, and I am going to 

ask that members’ opening statements be submitted for the record. 

For our new members, we recognize Senators based on order of appearance at the committee, alternating sides. 

But before I introduce the first panel, I would like to ask unanimous consent to enter two items into the record, first, testimony 

from the National Association of Conservation Districts, into the official record, and second, a letter from the U.S. Cattlemen’s Association. If there is no objection, we would enter that into the record. 

[The following information can be found on page 124-125 in the 

appendix.] 

4 

Chairwoman STABENOW. Thank you. 

Welcome again. We ask that you keep, as you know, our two witnesses know, keep your comments to five minutes, but we welcome 

your extensive written testimony to be shared with us, as well, and 

we are very pleased to have two very important experts with us. 

Our first panelist, Dr. Joe Glauber, is certainly no stranger to 

this committee. Dr. Glauber is the Chief Economist at the United 

States Department of Agriculture. Dr. Glauber served as Deputy 

Chief Economist at USDA from 1992 to 2007. In 2007, he was 

named the special Doha Agricultural Envoy and continues to serve 

as Chief Agricultural Negotiator in the Doha talks. 

Our next witness is Dr. Roger Pulwarty. I will now turn to Senator Bennet to introduce him, as well. 

Senator BENNET. Thank you, Madam Chair, and I want to just 

thank you on behalf of the people of Colorado for holding this incredibly important hearing. We have been afflicted by both drought 

and fire, so thank you for doing it. 

I am very pleased to introduce Dr. Roger Pulwarty to the committee this morning. Dr. Pulwarty comes to us by way of Boulder, 

Colorado, where he works at the National Oceanic and Atmospheric Administration. There, he heads NOAA’s National Integrated Drought Information System. He also serves as the Chief of 

the Climate and Societal Interactions Division of NOAA’s Climate 

Division. 

His past research and publications have focused on extreme 

weather events and disaster risk reduction in the Western United 

States, Latin America, and the Caribbean. Dr. Pulwarty has testified before Congress before. His past appearances have focused on 

climate change, water resources, and climate adaptation issues. 

He received his Bachelor’s degree from York University in Toronto and he received his Ph.D. in climatology from the University 

of Colorado at Boulder. 

Madam Chair, thank you very much for allowing Dr. Pulwarty 

to testify today. 

Chairwoman STABENOW. Thank you very much. 

Before hearing from our two witnesses, I am going to turn to 

Senator Johanns, who I know is doing double duty on a couple of 

meetings and wants to recognize someone who is on our second 

panel. Senator Johanns. 

Senator JOHANNS. Thank you, Madam Chair, for this courtesy. It 

means a lot to me, because I have a good friend and a great Nebraskan here and I think I am going to be gone during the second 

panel. 

But I did want to recognize Ben Steffen, and Ben, if you could 

just stand so everybody can identify who you are. Thank you, Ben. 

Ben is a successful farmer from Humboldt, Nebraska. He has a 

diversified operation. It includes dairy cattle, corn, soybeans, 

wheat, and hay. Ben and his wife, Paula Sue, and their family 

have been recognized for their good work by the Nebraska Farm 

Bureau and the Nebraska State Fair as Ag Family of the Day. 

They were one of five families chosen because of their contributions 

not only to agriculture, but to the community and to our great 

State. 

5 

Ben is a perfect example of someone who demonstrates the values of rural America. He is actively engaged in his community. In 

addition to the farming operation, Ben is involved with University 

of Nebraska’s President’s Advisory Board Committee and the 

State’s County Extension Boards. 

Given all of his experience, I think he is going to add valuable 

testimony, and I will just wrap up today and thank you and the 

Ranking Member for holding this very important hearing. Thank 

you. 

Chairwoman STABENOW. Thank you very much. 

We are actually going to start with Dr. Pulwarty today and ask 

you to share your perspective, and then we will turn to Dr. Glauber. Welcome. 

STATEMENT OF ROGER PULWARTY, DIRECTOR, NATIONAL INTEGRATED DROUGHT INFORMATION SYSTEM, NATIONAL 

OCEANIC AND ATMOSPHERIC ADMINISTRATION, BOULDER, 

COLORADO 

Mr. PULWARTY. Good morning. Thank you very much for allowing 

me to be here. Good morning, Chairwoman Stabenow and members 

of the committee. My name is Roger Pulwarty and I am Program 

Director of the National Integrated Drought Information System of 

NOAA. It is my honor to be here today. Thank you for inviting me 

to speak about the present drought and how we can improve information for anticipating and managing drought impacts. 

Drought is a pallet of the American experience, from the Southwest in the 13th century to the events of the 1930s and the 1950s 

to the present. From 2000 to 2010, the annual average land area 

affected by drought in the United States was 25 percent. Prior to 

the 2000s, this number stood at 15 percent. 2012 ended as one of 

the driest years on record, having had five months in which over 

60 percent of the country was in moderate to extreme drought. It 

was also the warmest year on record. Only 1934 had more months 

with over 60 percent of the U.S. in moderate to severe drought. 

1934 was also a warm year. 

Drought conditions continue across much of the nation. According to one estimate, the cost of the 2012 drought is in excess of $35 

billion, based on agriculture alone. However, it is important to note 

the drought-related impacts cross a broad spectrum, from energy, 

tourism, and recreation in the State of Colorado where I live, to 

wildfire impacts. According to the National Interagency Fire Center 

in Boise, over nine million acres were burned last year, which had 

only happened twice before in the record, 2006 and 2007, since 

1960. Low river levels also threaten commerce on the vital Mississippi shipping lanes, affecting transportation of agricultural 

products. As many of you know, half of the transport on the Mississippi is agriculturally based. 

An important feature of conditions in 2012 was the persistence 

of the area of dryness and warm temperatures, the magnitude of 

the extremes, and the large area they encompassed. Figure 1, 

which you have in front of you, shows the progression of drought 

conditions since 2010 to the present. Twenty-twelve began with 

about 32 percent of the U.S. in moderate to exceptional drought. 

The drought reintensified in May, and you can see a jump in the 

6 

figure there. And by the end of August, the drought had expanded 

to cover 60 percent of the country, from the Central Rockies to the 

Ohio Valley and the Mexican to the Canadian borders. Several 

States had record dry seasons, including Arkansas, Kansas, Nebraska and South Dakota. 

The drought years of 1955 and 1956 have the closest geographical pattern to what we have seen to date, and the year 1998, 

now the second-warmest year on record, and 2006, the third-warmest year on record, have the closest temperature pattern to what 

we see. 

So as of this morning, we have released the U.S. Drought Monitor that gives you present conditions, which people have in front 

of them. And what we are pointing out in this case is the drought 

continues across many parts of the Midwest and the West. The 

physical drivers of drought are linked to sea surface temperatures 

in the Tropical Pacific and Atlantic Oceans. 

As you can see from the last figure on the U.S. Drought Monitor, 

a dry pattern is expected over the upcoming three months across 

the South and the Midwest. Prospects are limited for improvement 

in drought conditions in California, Nevada, and Western Arizona. 

Drought development and persistence is forecasted for Texas by the 

end of April. The drought and warm temperatures in the Midwest 

are firmly entrenched into February, placing a greater need for 

above-normal spring rains if the region is to recover. This area is 

now becoming the epicenter of the 2013 drought. Despite some relief, much of the Appalachicola-Chattahoochee-Flint River Basin remain under extreme drought conditions, including low ground 

water levels, and Georgia is now in its driest two-year period on 

record. 

The number of watershed and State drought plans that use information from the National Integrated Drought Information System 

at the local levels has increased significantly, and the effectiveness 

of this effort through 2012 is the result of strong multi-State and 

multi-agency partnerships. 

In December 2012, we drew on these partnerships and convened 

a National Drought Forum in D.C. The goals of the forum were to 

understand the extent of the 2012 drought impacts and response 

and help provide new information on coordination for improving 

the nation’s drought readiness for 2013 and into the future. This 

forum was cosponsored by the National, Midwestern, Southern, 

and Western Governors Association, Federal agencies, and regional 

and local partners. It highlighted the need to increase public 

awareness of this year’s drought and potential future impacts, to 

increase the technical assistance for using drought-related information in those local rural impacted communities, and ensure sustained support for monitoring and other data critical for responding 

to drought, such as SNOTEL sites and the water census led by the 

USGS. 

Through the Economic Development Administration and NIDIS, 

we are working with USDA on its National Disaster Recovery 

Framework for drought, and these efforts will be bought around a 

recently signed MOU between Commerce and USDA to improve 

cross-agency collaboration. 

7 

Over the coming year, we will focus on increasing public awareness of available information and transfer successful approaches in 

early warning to areas not having those systems as yet to improve 

the understand and predictability of multi-year droughts and to 

work with the private sector and others on guidance and standards 

for developing value-added products. 

All of the information in this testimony is drawn from NIDIS and 

its many supporting Federal, State, Tribal, and private partners, 

including NOAA’s Climate Prediction Center, the National Drought 

Mitigation Center, the University of Lincoln, Nebraska, the Corps 

of Engineers, the Department of Interior, USDA, and others. 

Thank you for the opportunity to be here today. 

[The prepared statement of Mr. Pulwarty can be found on page 

78 in the appendix.] 

Chairwoman STABENOW. Thank you very much for that sobering 

information. 

Dr. GLAUBER. 

STATEMENT OF JOE GLAUBER, CHIEF ECONOMIST, U.S. 

DEPARTMENT OF AGRICULTURE, WASHINGTON, DC 

Mr. GLAUBER. Well, thanks very much. Chairwoman Stabenow, 

Ranking Member Cochran, and other members of the committee, 

thank you for the opportunity to be at today’s hearing. 

Despite a historic drought affecting much of U.S. agriculture, the 

U.S. agricultural economy is strong, and in aggregate, farm income 

measures are at or near record highs. However, aggregate measures belie large differences between sectors. Row crop producers 

have generally fared well, despite the adverse weather, in large 

part due to higher prices and protection from the Federal Crop Insurance Program, which has helped offset many of the yield losses. 

For uninsured producers, or producers of crops for which insurance 

is unavailable, however, crop losses have had a more adverse effect. 

Livestock producers experienced high feed costs and poor pasture 

conditions this year with limited programs to fall back on, particularly since key livestock disaster programs authorized under the 

2008 farm bill are currently unfunded. 

What had started out as a promising year for U.S. crop production, with favorable planting conditions supporting high planted 

acreage and expectations of record or near-record production 

turned into one of the most unfavorable growing seasons in decades. Crop production estimates for several major crops declined 

throughout the summer. By January 2013, final production estimates for corn were down almost 28 percent from our May projections. Sorghum was down 26 percent, while soybeans fell about six 

percent over the same period. 

As a result, prices for grains and oil seeds soared to record highs 

in the summer. Higher prices and crop insurance indemnity payments helped offset crop losses for many rural crop producers. 

Roughly 85 percent of corn, wheat, and soybean area, almost 80 

percent of rice area, and over 90 percent of cotton area is typically 

enrolled in the Crop Insurance Program, and for those of you who 

were around back in 1988, this contrasts sharply with what the experience was in 1988 when we had this massive drought in the 

Midwest. At that time, only about 25 percent of the area, insurable 

8 

area, was enrolled in the program. So, again, very, very strong participation has helped offset those losses. 

As of February 11, just this Monday, about $14.2 billion in indemnity payments have been made to producers of 2012 crops suffering crop or revenue losses. We think that these indemnity payments will likely go higher. They could be as high as 16 or 17 billion dollars before we are done. 

On the other hand, looking at the livestock, dairy, and poultry 

producers, they are facing very high feed costs for most—they faced 

very high feed costs for most of 2012, and the high prices are likely 

to persist through much of 2013 until new crops become available 

in the fall. And in addition to these high feed costs, cattle producers have been particularly hard hit by poor pasture conditions 

and a poor hay crop. Almost two-thirds of the nation’s pasture and 

hay crops were in drought conditions, with almost 60 percent of 

pasture conditions rated poor or very poor for most of July, August, 

and September 2012. December 1 stocks for hay were at their lowest level since 1957. 

The U.S. cattle and calf herd, as was mentioned in your statement, is at its lowest level since 1952. Dryness in the Southern 

Plains has persisted for over two years and resulted in large liquidation in cattle numbers. The January 1 NASS Cattle Report indicated that total cattle and calf numbers in Kansas, Oklahoma, 

and Texas alone declined by 3.4 million head between 2011 and 

2013. The reduction is a 13.6 percent decline and almost equals the 

net decline in the U.S. herd over the same period. Likewise, dairy 

producers have faced high feed costs and poor pasture conditions, 

and higher temperatures during the summer also adversely affected milk production. 

Net cash income is forecast lower in 2013 for all livestock, dairy, 

and poultry sector. Feed costs make up 51 percent of expenses for 

dairy, about 20 percent for beef cattle, 42 percent for hogs, and 35 

percent for poultry farm businesses. 

Major concerns related to persistent drought conditions remain. 

Fifty-nine percent of wheat area, the winter wheat area, 69 percent 

of cattle production, and 59 percent of hay acreage remains under 

drought conditions. Forty-three percent of the winter wheat production is located in areas under extreme or exceptional drought conditions, down only slightly from the 51 percent in August. While that 

also implies that spring plantings may be affected by drought conditions, there have been some improvements in the Eastern Corn 

Belt, where many areas are no longer experiencing drought. Assuming adequate precipitation, it is likely that the major spring 

planted row crops will see a return to trend yields. If so, a rebuilding of stocks and lower commodity prices would be expected in the 

fall, that is, the fall of 2013. This should help relieve feed prices. 

That concludes my testimony. I would be happy to answer any 

questions. 

[The prepared statement of Mr. Glauber can be found on page 47 

in the appendix.] 

Chairwoman STABENOW. Thank you very much to both of our 

witnesses. 

Dr. Glauber, let me start with you. If you could talk a little bit 

more about the financial impacts of the drought between sectors, 

9 

the average livestock producer, a row crop farmer, a specialty crop 

grower. Paint a little bit more of a picture on this. 

Mr. GLAUBER. Well, again, it is—as you mentioned, there were 

a number of calamities that hit producers. If I can start with the 

drought, because that certainly has had most of the attention. 

There, you really have just seen, because of the extensiveness of 

the drought and the severity of the drought, larger yield loss in 

most areas, and we haven’t seen anything like this in the Corn Belt 

since 1988. I mean, certainly, the floods in 1993 were bad, but insofar as drought is concerned, this drought is the worst since 1988. 

With that, we saw record prices. Now, record prices help row 

crop producers, because if you have a crop, you are going to be getting paid high prices and several areas of the country did do pretty 

well. Southeast, for example, which was in drought conditions for 

most of the year, including the summer, they did have timely rains 

and they were able to get a crop in, in many cases, record yields 

in some areas. They were able to take advantage of higher prices. 

Higher prices help offset some of those losses, but when you move 

to areas—and in addition, again, as I mentioned in my testimony, 

just very high participation rates with many of the corn and soybean producers insuring at 70 percent or higher and many of them 

insuring with revenue products that indemnify at harvest prices. 

Chairwoman STABENOW. So if you have crop insurance, it made 

a significant difference. 

Mr. GLAUBER. It made a very big difference. 

Now, let us go to the flip side. If you were under-insured, if you 

were not insured, then you were looking at yield losses, and particularly for some specialty crop producers, where the participation 

rates tend to be lower, or there may not be anything other than 

non-insured acreage disaster programs, their losses could be larger. 

We know, for example, in your area, Pennsylvania, New York, because, as you mentioned, the warm early spring, a lot of the tree 

crops flowered and then were hit with a devastating freeze. And, 

again, if you are insured, you will get some compensation there, 

but if not—you were facing some serious losses. 

Chairwoman STABENOW. Well, how long before we are going to 

have crop insurance available for specialty crop growers? 

Mr. GLAUBER. Well, I think we have made some improvements 

there. As you know, I sit on the Federal Crop Insurance Board. We 

have seen several products, new products that have come in that 

have extended crop insurance to some specialty crops. We have 

made some changes, for example, in the cherry policy with a revenue product. I think the overall liability for specialty crops right 

now is around 10 to 13 billion dollars. Certainly, we would like to 

see that improved. 

The difficulty is that with a lot of these crops, they are very 

small with not a lot of producers, and sometimes some of the producers are not interested in crop insurance. Now, what we have 

seen over the last five years, ten years, which is very different 

than, I would say, 15 years ago, is the fact that a lot of producers 

now are interested in developing these products. 

I think there is some potential there, particularly for these rainfall products and some of these index products, more generic insurance products that could affect some of these producers that are 

10 

particularly vulnerable to specific risks, like freeze or other sorts 

of weather damages. 

Chairwoman STABENOW. Well, as you know, I care very deeply 

about making sure we provide the same kind of crop insurance to— 

we have an awful lot of producers that want that, and I appreciate 

you working with us on cherries. But we have got to make sure all 

of our producers that want and need crop insurance have access to 

it. 

But I want to turn to Dr. Pulwarty before my time is up and ask, 

was the weather experience last year normal, and if not, do you expect the same type of severe weather that we saw in 2012 to be 

a persistent problem in coming years? What about this year? What 

about the future, when we look at the volatility in the weather patterns? 

Mr. PULWARTY. Thank you for the question. The event that we 

saw in 2012 began to a large extent at the end of 2012. The extent 

to which we saw the drought conditions was not completely outside 

the realm of natural variability, even though the drought itself was 

exacerbated by the fact that we had very high temperatures. That 

combination of natural variability and the background temperatures did have a significant impact on stressing our reservoir systems and our crops. 

From the standpoint of looking at temperature relationships and 

the future, in the 1950s and the 1930s and other periods in which 

we had high temperatures, we saw that it did impact, affect, the 

size, magnitude, and the extent of the drought system. Twentytwelve was very unusual, but we are not finding a strong link from 

sea surface temperatures or other driving factors. But, instead, the 

major jump from May into summer, when we jumped from about 

30 percent to 60 percent, was caused by a high ridge just sitting 

over the United States leading to much drier conditions. 

Chairwoman STABENOW. And you expect that—did I hear you 

earlier say that you expect that this year, as well? 

Mr. PULWARTY. And the continuing conditions really look like we 

are setting up for a very similar level of drought in the Midwest 

and the West. However, since none of this is absolutely predictable 

100 percent, we are hoping for some alleviation in the late spring. 

Our major issue, as you know, in the Midwest and the Southwest, in particular, the Colorado Basin, is that we are having backto-back dry years, and a third year of that puts our systems completely under stress. The forecast for this season is that, in fact, we 

are projecting drier conditions. 

Chairwoman STABENOW. Thank you very much. 

Senator Cochran. 

Senator COCHRAN. Madam Chair, thank you very much. 

We are all trying to figure out exactly what the practical consequences are going to be for sequestration and targeting of certain 

programs for cuts. These cuts will be visited on recipients of government program dollars, and these recipients had been planning 

the use of these dollars for some time. And I specifically wanted to 

ask you about the Agricultural Disaster Relief Fund. It is included 

in a list of accounts targeted for sequestration. Can you tell us a 

little bit more about when, specifically, the dates for this sequestration can be expected to be released or imposed on those who benefit 

11 

from these programs, and exactly what the impact will be on producers who have signed contracts relying upon the fact that the 

Agricultural Disaster Relief Fund would provide specific amounts, 

given the sign-ups and other compliance requirements. 

Mr. GLAUBER. Thanks, Senator, and I am almost hesitant to talk 

about appropriations with someone like yourself who knows these 

books far better than I do. 

As you know, we have the mandatory accounts and we have the 

discretionary accounts. My understanding is we have been working 

with OMB on determinations of what under the mandatory accounts would be shielded and what would be affected by the sequester. Hopefully, there will be some release on that information 

soon. 

Insofar as the discretionary accounts, there what you find is that 

for a lot of the—as you are well aware, on the discretionary side 

in terms of the agency budgets, a lot of those are salary-based. 

There is some discretion, but with the costs of salaries and expenses, there is not a lot you can do to sort of avoid, if you are talking about a five, six percent cut, in terms of how you manage that. 

Insofar as these specific disaster provisions that you mentioned, 

I am going to have to get back with you on that and would be 

happy to do so. We will follow up on that. But in terms of the specific things like livestock disaster provisions, those have been unfunded out of the 2008 farm bill, of course, and so they would need 

additional funding for those. But I can get back with you on the 

other accounts. 

Senator COCHRAN. It would be interesting to know what the administration’s plans are so producers can plan and not be surprised 

totally at the last minute. So that would be very helpful, if you can 

supply us with some information. 

Sequestration is a word we are all still trying to figure out how 

you define and what the practical consequences of it are. I think 

it shifts more responsibility to the administration than they are accustomed to having. Usually, Congress specifies a level of appropriations for government program funding and that is carried out. 

I remember, I think it was maybe during the Nixon administration 

where they came in and impounded funds and everybody in Congress threw up their hands and held their heart, oh, my gosh. We 

directed that this be spent. This is mandatory spending. So we contrived these things that tell the administration in no uncertain 

terms, this is money that is to be spent. It is appropriated. It is 

mandated. Spend it. 

What is your reaction to that in this environment? Have things 

changed? Are we going back to government impoundment? And 

when do we know about it? How are you going about identifying 

those programs that are going to have the funds impounded, or sequestered, the new word? 

Mr. GLAUBER. Well, thanks. I remember not so fondly the days 

of Gramm-Rudman and the cuts that went in place back in the 

1980s. Again, as I mentioned, my understanding, at least, the Secretary has been working with OMB on what qualifies, at least 

under the mandatory spending, what would be subject to sequestration. Obviously, there are some accounts that will not be affected because of contractual relations, other things, and then othVerDate Nov 24 2008 08:25 Sep 15, 2014 Jkt 000000 PO 00000 Frm 00015 Fmt 6633 Sfmt 6633 C:\USERS\MW42035\DESKTOP\DOCS\87563.TXT MICAH
12 

ers that at least the lawyers feel that they do have authority to sequester. I can get back with you on that. 

I agree with you in your point that the sooner the better this is 

made known. People have to make planning decisions, understand. 

Senator COCHRAN. Thank you. 

Chairwoman STABENOW. Thank you very much. 

Senator Klobuchar. 

Senator KLOBUCHAR. Thank you very much, Madam Chair. 

Thank you for heading up this hearing, calling this hearing. 

I think, first of all, it just calls to mind how important it is to 

get this farm bill passed when you think of the provisions that 

would help with the disasters that you mentioned, from the Livestock Disaster Program to the conservation tools that are contained 

in our new farm bill, obviously, the crop insurance and then the 

grazing, expanded grazing opportunities that we included for livestock producers as well as the agriculture research on drought-resistant seed. So, again, that was my basic reaction when I listened 

to both of you, so thank you for that. 

I wanted to ask specifically about, first of all, how this could affect exports. I see this is one of our main ways to get out of somewhat of the trench we are in with the economy right now, and that 

is increasing exports. Minnesota exported $6.8 billion worth of agricultural goods just last year, and how does the increase in extreme 

weather impact our ability to capture growing export markets. 

Dr. Glauber. 

Mr. GLAUBER. Thank you, Senator. There is a certain counterintuitive result about exports, much like farm income. We will put 

out new farm export numbers just next week. But our November 

estimates show a record export level this year. Now, that is largely 

because of higher prices. If you look at, say, corn, we just revised 

our estimates downward for corn exports over the 2013–2014 year 

to 900 million bushels. That is the lowest level since 1971. 

Senator KLOBUCHAR. So what you are saying is the price has 

caused the export numbers to go up? 

Mr. GLAUBER. Export value, that is right. The volumes are down, 

not for all commodities, but for corn. 

Senator KLOBUCHAR. Okay. Very good. But we would like the volumes to go up, I think, too. 

Mr. GLAUBER. Yes. 

Senator KLOBUCHAR. Mississippi River transportation is my next 

question. In 2012, as you know, the barge traffic on the Mississippi 

was greatly impacted by the drought. It was more difficult to transport grain abroad and more farm inputs up-river to our farmers in 

Minnesota. We were very scared at the end of the year they were 

actually going to have to stop barge traffic. Could you talk about 

that a little and how this could impact our ability to stay competitive, as so many agriculture products go down the Mississippi? 

Mr. GLAUBER. Yes. We, too, were very concerned with it because 

it looked like, particularly late December, early January, that there 

would be a halt in traffic. Now, understand, the upper part of the 

Mississippi, as you well know, you stop shipping because of the 

winter weather. But I think there were a couple of good things. 

One, the best thing, is that we got rain. The Corps was able to go 

13 

in and clear out some of the disruptions in the river and then we 

got adequate rain and barge traffic is moving very well. 

I will say this. Because of the lower corn harvest and lower soybean harvest and the fact that so much more grain is going to 

China, it was probably less stress than it might have been under, 

say, 15 years ago. But, still, the best news is that we have adequate water. 

Senator KLOBUCHAR. Right. It is good, but it was a close call and 

I think it is something that we have to prepare better for next time 

and have a plan in place. 

Drought-resistant seeds—what efforts is the USDA taking to 

speed the adoption of such drought-hardy varieties developed using 

biotech or conventional breeding? 

Mr. GLAUBER. Well, as you know, most of the breeding for seed 

breeding is in private hands these days. They do it better. There 

are a lot of profits to be made in that industry and they are working very hard. My understanding is, is that we should be seeing 

some disaster-resistant, purely disaster-resistant strains come on 

the market just in the next few years. So that is an encouraging 

sign. I think the R&D that has been going into seed research continues to be very, very strong, largely in private hands. We do some 

public research there, but most of it is coming from the private sector. 

Senator KLOBUCHAR. All right. During last year’s disaster, I supported emergency efforts to help with haying and grazing, as you 

know, and one of the concerns I have heard is that emergency 

haying and grazing is often only allowed in counties already impacted by drought, in other words, counties where the land is already dry. I see you nodding your head, Dr. Pulwarty. What steps 

could the USDA take to expand the areas allowed for emergency 

haying and grazing? 

Mr. GLAUBER. Well, you are absolutely right. It does not help you 

much if you allow haying and grazing when there is no pasture to 

speak of. I think we allowed about 2.8 million acres to be hayed 

and grazed. There are restrictions on that during nesting periods. 

Right now, we do it with disaster designated counties. I might add, 

with things like pasture, obviously, it does not help much to have 

pasture 1,000 miles away that is in good shape. But with hay and 

things like that, you can move that around some. So, certainly, we 

would be happy to work with you in trying to improve that flexibility. But it is just to say, remember, this year, it was such an extensive area where you are really talking 60, 65 percent of pasture 

in drought conditions. 

Senator KLOBUCHAR. Thank you. 

Dr. Pulwarty, did you want a quick follow-up? 

Mr. PULWARTY. Just a very brief follow-up to the issue of the 

Mississippi and barging. We know upstream, as well, about 20 percent of what comes into the basin is coal and 20 percent is about 

fertilizers, as well. And from the standpoint of how we look at monitoring, while there is the strong effort on improving certainly our 

drought-resistant crops and the conservation programs, the idea of 

monitoring around the world, places like China and so son, becomes very important from the standpoint of how we understand 

where drought is happening. 

14 

Senator KLOBUCHAR. Okay. 

Mr. PULWARTY. We have been receiving calls from around the 

world saying, well, what is happening this year, and where—— 

Senator KLOBUCHAR. Because they know it is going to impact 

them. 

Mr. PULWARTY. —they can step into some of the markets. So 

from that standpoint, I would really like to add to the issue of 

given the importance of transportation, that in the context of other 

areas that are not only vulnerable, but they are looking at their 

own productivity, like Brazil, India, and elsewhere, that strengthening our understanding of global monitoring is critical. 

Senator KLOBUCHAR. Thank you. 

Dr. Glauber, please pass on to Secretary Vilsack that I am very 

much looking forward to him coming to our Pheasants Forever 

Convention in Minnesota this weekend. We are going to be together. Thank you. 

Chairwoman STABENOW. You got that plus in there. Okay. 

[Laughter.] 

Chairwoman STABENOW. All right. Senator Roberts, before you 

arrived, I said, thank you for your service and wish you well in 

your new Ranking Membership on the Rules Committee. And so, 

welcome. 

Senator ROBERTS. Would you like me to respond? 

Chairwoman STABENOW. Yes, please. Well, you are actually up 

next for questions, as well, so—— 

Senator ROBERTS. Well, I thank you. I want to say that I am 

looking forward very much to working with our new leadership 

team. No Chair of this committee, at least to my memory, and I 

have been around for quite a while, has worked any harder, with 

more perseverance, with more enthusiasm for agriculture than our 

current Chairperson. So, Madam Chairperson, I want to thank you 

personally for all of your past courtesies, your staff working with 

my staff during very difficult times, the committee hearings that 

we have enjoyed, and especially your perseverance over the last 

session. 

I look forward to working with you and my colleague and my 

friend for over 20 years. I just told him that my closing line with 

regard to Senator Cochran—Thad and I have been friends for a 

long time—is that the Marines always depend on the Navy if we 

are going to get anything done. 

[Laughter.] 

Chairwoman STABENOW. Well, thank you very much. 

Senator ROBERTS. Well, they just bring us to the battle, and then 

we have to do the fighting, but then that is beside the point. 

[Laughter.] 

Senator ROBERTS. He asked a very critical question. Joe, I really 

hope that you and the Secretary can work together and the rest of 

your staff to determine what—we might have a different idea of 

what is mandatory and what is discretionary. And I would point 

out that through the leadership of the Chairperson and everybody 

on this committee, we were the only committee that stepped up in 

the last session and offered up $24 billion of savings. That was 

wrapped up in the five-year farm bill that we passed here with 73 

votes. And so I am very proud of the fact that agriculture did its 

15 

duty in regards to deficit reduction, but what is considered mandatory and discretionary is going to be exceedingly important to our 

farmers out there, and you know which programs we are talking 

about. So I think Senator Cochran really hit the nail on the head, 

and if we can get that information to all of us, that would be helpful. 

Well, we have got two years of sustained drought and another 

one coming, according to our renowned forecaster here. But Kansas 

producers, once again, put seeds in the ground. Many will once 

again fire up their tractor and their planter in another six weeks. 

This is not due to some day late or dollar short ad hoc disaster program. It is because they manage their risk and protect their operations from Mother Nature’s destruction through the purchase of 

crop insurance. 

Unfortunately, livestock producers do not have a similar safety 

net. However, with the support of Secretary Vilsack last year, the 

Department authorized the emergency haying and grazing of Conservation Reserve Program acres in all Kansas counties, including 

the emergency grazing on CP-25 for the first time. You do not do 

that unless you have a very, very serious problem. This was a lifesaver for ranchers struggling to find or pay for feed, and I want 

to thank all the parties involved for allowing it to happen. 

Now, according to USDA reports last year, over 9,000 emergency 

haying and grazing contracts allowed haying and grazing on over 

470,000 acres in Kansas, that’s a lot of acres. As we continue to experience drought, and Dr. Pulwarty, if you could get El Nino to 

step up to La Nina, it would be very, very helpful. Bring a little 

moisture in from the Gulf. But as we continue to experience what 

we have experienced in the 1950s and back in the 1930s, what considerations has the Department given to allowing emergency 

haying and grazing of CRP acres for 2013?? 

Mr. GLAUBER. Senator, we will certainly be looking at this. We 

have already made some disaster declarations for counties in 2013. 

As we move forward and we get into those situations—I would 

agree with you. I think, particularly for cattle producers, the next 

four or five months are extremely critical, one, to be looking at, 

hopefully, some better pasture conditions, and then in the fall, better crop prices so that we get lower feed costs. But a lot of these 

producers have been hanging on with very, very tight or negative 

margins. And again, I cited these numbers. Over three million, 

three-and-a-half million head down from just two years ago in your 

region of the country. And so it is very critical. I think any help 

that we can get to the producers to help them make it through to 

better prices, we will be working with your office on that. 

Senator ROBERTS. I know you will cooperate with us. You have 

in the past, and I thank you for your assistance. As you know, 

many ranchers simply culled their herds and lost their genetics 

and many are out of business. 

Mr. GLAUBER. Yes. 

Senator ROBERTS. And we look for the same problems, unfortunately, today. 

Northwest Kansas producers irrigating from the Ogallala Aquifer, they must work to conserve their water, but current RMA practices do not have a middle ground between fully irrigated and dry 

16 

land practices and we need a mechanism to allow limited irrigation 

to be fairly rated. I know you know that. And as the Chairwoman 

has pointed out, time and time again, the more producers that are 

under the crop insurance tent and using risk management tools, 

why, the better off we are going to be. So I am interested in hearing your thoughts on how to improve an enormously successful program. You do not have to answer that right now. My time has expired, and I will submit that question for the record. I thank you 

for your service. 

Thank you, Madam Chairperson. 

Chairwoman STABENOW. Thank you. 

Senator Bennet. 

Senator BENNET. Thank you, Madam Chair, and again, thanks 

for holding the hearing. 

I actually just want to pick up where Senator Roberts left off and 

say thank you for the emergency grazing. We have a rancher 

named Al Heaton who runs most of his cattle in Colorado’s Dolores 

County, which is near the Utah border, and he was the first person, Madam Chair, to say to me that if he knew in advance that 

he could have an extended period of time on CRP land, that it 

would allow him to manage his summer grazing differently than he 

was and stress that less. We were able to take his voice to Washington and the Secretary responded to that, and it sounds like we 

are going to have another year where we are going to need more 

of that. 

I wonder, Dr. Glauber, if you would like to talk briefly about the 

value of the USDA Conservation Programs for keeping our soils 

healthy and occasionally giving producers this type of relief. 

Mr. GLAUBER. No, there is no question. I think, particularly in— 

well, in a lot of areas, obviously—— 

Senator BENNET. I am all that is left, so you can talk about how 

important it is to Colorado. 

[Laughter.] 

Mr. GLAUBER. But, particularly in those areas where we are seeing very dry conditions right now. Things like the Emergency Watershed Protection Program, which I think is very, very important. 

If you look at the wildfires that affected Colorado, there, as you 

know, we are limited in funding. We hope that we can work and 

get funding restored to some of these programs. But I think, there, 

again, very important to mitigate and to help communities respond 

to these disasters. 

Senator BENNET. Actually, you raise—I am going to come to Dr. 

Pulwarty next, but you raise an important point. We had the EWP 

funds in the Sandy bill that was passed by the Senate, appropriately so, I think, because we are still trying to deal with the effects of these disasters in our State, these wildfires that you talk 

about brought on by drought and other circumstance. You know, as 

the former Ranking Member was saying earlier, this is the only 

committee that actually did bipartisan deficit reduction in the last 

Congress. It had the sense, however, to think about things like fire 

mitigation as something that would save us money going forward 

rather than making these cuts in the name of deficit reduction, 

knowing that we are going to have to deal with these disasters on 

17 

the back end and the effect on our watershed on the back end. I 

wonder if you have thoughts about that. You are an economist—— 

Mr. GLAUBER. Well, no, this has been a very successful program 

when the funding is there to help communities and to organize on 

this and to do the sort of mitigation efforts and rehabilitation efforts that are necessary. It has been very important and, hopefully, 

we will find a funding source for these. 

Senator BENNET. This is another case, I think, where the 

Congress’s inability to act in real time is absolutely penny wise and 

pound foolish. I mean, when the spring snow melts start in Colorado, which they inevitably will, even though we do not have the 

snow pack that we wish that we had, you know, watch these hillsides wash into our streams. The effect on our water systems, the 

effect on our producers could be very significant. It is, I think, another case where people are playing games here instead of focusing 

on what is going on at home. 

Dr. Pulwarty, I have never said this to a witness in any hearing 

that I have ever attended in Congress, but I hope you are wrong, 

because—— 

Mr. PULWARTY. I do, too, sir. 

Senator BENNET. —we have now had two years in a row, and it 

sounds like we are going to have a third year of drought in our region. And I wonder if you could talk about the specific challenges 

that NOAA projects for producers in the water-scarce Western region of our country. 

Mr. PULWARTY. Thank you very much, Senator. I hope I am 

wrong, as well. The State of Colorado, as you know, in the Front 

Range, where I live and others do, we get 40 percent of our water, 

30 to 40 percent, from the Colorado Basin itself. The Colorado 

Basin came in at 44 percent in the previous water year. So far, the 

fall snow pack has not been as significant as we would like it. In 

some places, it is 40, some places 60 percent, and we hope that 

picks up in March and April. 

However, right now, based on what is happening in the Pacific 

Ocean and the Atlantic Oceans, we are not projecting an improved 

set of conditions in those basins, the Upper Basin, including the 

San Juan and places like that. I actually know the Dolores Valley 

pretty well. I know where Mr. Heaton is. 

The area in terms of the basin is experiencing some lower precipitation and snow pack, and it is also experiencing a combination 

of high temperatures, however driven. Something else that is happening in that basin has to do with some of our rural communities, 

where there is rain-fed agriculture. So the combination of temperature and drought is actually creating the die-off of key vegetation 

that holds our soils together. And the result, then, is dust storms, 

dust on snow, which lets the runoff and melt occur even earlier 

than we are accustomed to managing it. 

From that standpoint, and looking into the future, while we are 

seeing some improvement in the lower Colorado Basin—Arizona, 

Southern California, Nevada—we are expecting that to be shortlived into April. From the standpoint of the Upper Basin, and 

again, I hope I am, in fact, wrong, we are not projecting significant 

new inputs of snow unless we get heavy rainfall events later in the 

spring. 

18 

One of the reasons why that is the case is when it has been dry 

for a year before, even when you get significant snow pack, a lot 

of that disappears because the soil just picks it up. In 2005, we had 

100 percent of snow pack, but the runoff was 70 percent of what 

we expected because the springtime had been warm. 

The Colorado is now in its second longest ten-year period of low 

flows on record. If we average over the last ten years, the flow has 

been at average or less, and this is in an already over-allocated system, as you know better than I do. I have only lived in Colorado 

for 26 years, so I am a newbie. 

The issue concerning the basin, where 30 million people live and 

where we have seven States reliant on the water, is very much at 

the edge. The demand exceeded supply about ten years ago, so it 

does not take a major drought to put us into areas of contention. 

What has been excellent, however, has been that our partners, 

the Bureau of Reclamation and others, have stepped back and said, 

let us work with the States on how to effectively manage this situation. What new information can we provide? 

So NOAA is working with the River Forecast Center in Salt Lake 

City, is working with Reclamation and others, to make certain that 

we are clearer on what that inflow might look like. And to be perfectly honest, given the uncertainty, certainly, there are issues in 

introducing drought-resistant crops. There are issues in introducing risk pooling and insurance. But where the Conservation Reserve Programs come in is the admission that we are uncertain 

about the future, that it leaves us the flexibility to manage for the 

pieces that we are uncertain about. And I think that is the richest 

contribution from the standpoint of an understand what the weather incline is doing, naturally or otherwise, and then what the buffers in our system supply. 

Senator BENNET. Thank you, Madam Chair. 

Chairwoman STABENOW. Thank you very much. 

Senator Cowan, welcome. 

Senator COWAN. Thank you, Madam Chair, and I am pleased to 

join this honorable committee today. I have a question, but I would 

preface it by saying the last time a Massachusetts Senator sat on 

this committee was in 1879—— 

[Laughter.] 

Senator COWAN. —and I am only the third Senator from Massachusetts to serve on this committee. So if you are wondering why 

I am here, I want to tell you. 

We in Massachusetts are not unfamiliar with agricultural issues 

and the importance of agriculture to this nation and certainly the 

Commonwealth. Personally, I spent much of my childhood in North 

Carolina on my great-grandparents’ working farm, where almost 

everything we ate was either grown or born on that farm. 

Though Massachusetts is not a Corn or Wheat Belt State, it is 

an important food producer for the nation. In the Northeast, specialty crops and dairy are our largest agricultural sectors, and we 

are the nation’s leaders in sales of locally-grown products, with a 

growing and dynamic population of organic and new and first-time 

farmers. We are also the second-largest producer of cranberries. 

Not only do we have roughly 8,000 farms, we also have over 80,000 

19 

fishermen, farmers of the sea. These farmers and fishermen have 

a combined production of $7.2 billion in annual sales. 

I recognize that some aspect of our fisheries are not in the jurisdiction of this committee, but fishermen from the Northeast who 

risk their lives to put food on our tables must be treated with the 

same respect as farmers across the nation. Our fishermen are 

struggling, too, and are currently facing drastic stock reductions. 

Many fishermen, through no fault of their own, are in dire straits, 

and I will continue to push for provisions in the farm bill that my 

predecessor, Secretary John Kerry, advanced to ensure that fishermen are eligible for disaster assistance programs, just like the 

other important farmers in this nation. 

As we look to reauthorize the farm bill in this Congress, we must 

make sure farmers and fishermen have the tools they need to manage risk, that we protect our natural environment for future generations, and that we preserve Federal nutrition and other programs that ensure that no child is forced to go to bed hungry. 

We also need to be thinking about new threats that our farmers 

and fishermen are facing. The climate change and more frequent 

and intense extreme weather events threaten our agricultural economy, and I am pleased that the committee is discussing this important issue today. According to the Climate Vulnerability Initiative, 

the U.S. is among the top ten countries that will be most adversely 

affected by desertification and sea level risk, and this does not bode 

well for either our farmers or fishermen. 

Again, I am honored to join this committee and I look forward 

to representing the interests of Massachusetts citizens, farmers, 

and fishermen and working with all to solve our challenges. 

Now, I would like to ask a question of Dr. Glauber, if I may. As 

an economist, and as we have heard more and more about the increased frequency and intensity of weather patterns and the changing climate over the next 50 years, I am wondering if you might 

be able to tell us a little more about your expectations of what that 

is going to mean in terms of our agricultural economy, both in the 

U.S. and globally, if we do not do something to curb some of the 

greenhouse gas issues we are facing. 

Mr. GLAUBER. Well, thanks very much, Senator. Just last week, 

in fact, the USDA put out two major reports on climate change, 

looking at what the impacts of climate change would be on agriculture, and among a number of findings, one that does stand out 

is sort of the variability in weather and the potential there, the impact on agriculture from the sort of extremes that one might see 

because of increases in temperatures due to climate change. 

One thing we are working on at USDA, and this goes across both 

in terms of the forests and in terms of agriculture, is looking at adaptation strategies. I think these are going to be very, very important. Clearly, the Forest Service has a good history there of putting 

in additional resources to look at that, but as we face these sorts 

of pressures, agriculture is going to have to be able to have adoptive strategies where they can help mitigate the impacts of 

variances in weather. 

The other thing, obviously, is things that can be done to actually 

reduce carbon emissions, and there, forests in particular, we are 

looking at things like carbon sinks. There has been a lot of work 

20 

done there, and there continues to be a lot of work done there, and 

on conservation practices, which help reduce greenhouse gas emissions. 

Senator COWAN. Thank you, Doctor. Thank you, Madam Chair. 

Chairwoman STABENOW. Thank you very much, Senator. I appreciate your advocacy for fisheries. You do follow in the distinguished 

steps of former Senator Kerry and we look forward to working with 

you on those issues, as well. 

Just one final question for Dr. Pulwarty. From your perspective, 

are the long-term temperature changes from climate change affecting the length or the severity of droughts like the one that we just 

saw last year? 

Mr. PULWARTY. Thank you for the question, Senator. When we 

have seen high temperatures before, they have certainly helped to 

exacerbate drought conditions. From the standpoint of what the 

modeling studies are showing, into the middle of this century, it is 

about when we would really begin to see the stronger influence of 

temperature on the severity of drought. 

From the standpoint of what has recently happened, there is a 

lot to be learned from it, about the relationship between temperature and the extent of drought, but it is as yet too early to say that 

we can definitely describe a piece of this to anthropogenic climate 

change, how much that would be. 

Is the background changing? Is climate changing? It is. Will temperature affect the magnitude and strength of droughts into the 

long term? We are anticipating by the middle of the century, we 

would, in fact, see that signal. Was that the case in 2012? We can’t 

conclusively say so. However, what we can say into the future is 

that the link between temperature and dry conditions—in the case 

of 2012, the drought was actually caused really much more by a 

lack of precipitation—temperature itself does not create a drought, 

it can help exacerbate a drought—from that standpoint, it becomes 

even more important to develop the monitoring and early warning 

systems that are needed, simply because when we add drought and 

a background trend together, what we produce is a surprise in the 

system, such as 2012 or 2002. It is not simply the addition of a 

drought event on a linear trend. When those two are added together, in many cases, sometimes what is produced is larger than 

we anticipate. Thank you. 

Chairwoman STABENOW. Thank you very much. 

We have been joined by Senator Grassley. Welcome. We are 

pleased to see you this morning and we will turn things over to you 

for questions. 

Senator GRASSLEY. Am I the only one who has not yet asked a 

question? 

Chairwoman STABENOW. You are the only one, and if you would 

like, we could keep—— 

Senator GRASSLEY. Can you please give me five minutes? 

Chairwoman STABENOW. I can give you—what I will do is ask— 

we can continue to ask questions of our panelists. 

I will ask Dr. Glauber, could you speak a little bit more—and we 

will give Senator Grassley a moment—from a livestock perspective 

as to what has happened in terms of the severity of the drought. 

Livestock producers have no access to crop insurance. From a fiVerDate Nov 24 2008 08:25 Sep 15, 2014 Jkt 000000 PO 00000 Frm 00024 Fmt 6633 Sfmt 6633 C:\USERS\MW42035\DESKTOP\DOCS\87563.TXT MICAH
21 

nancial standpoint, they are left there trying to deal with everything that has been happening, as well as rural communities and 

what is happening. We are seeing facilities shutting down and so 

on. The ripple effect of this is very serious. I wonder if you might 

speak a little bit more about that. 

Mr. GLAUBER. No, absolutely, and I think—I keep pointing out 

to people, when we talk about record farm income, it makes it 

sound like everything is going great. I think if you look at the livestock sector, and really over the last five years, you think of the 

price spikes that we have seen—we saw one, of course, in 2007– 

2008, another price spike in 2010–2011, and now this one caused 

by the drought—these clearly, when you talk about higher grain 

prices, higher soybean prices, this as a big impact on producers. We 

all remember the struggles that the dairy industry went through 

in 2009. You look at the hog sector, look at the poultry sector, similar things happened in 2008. We are really back in those sort of 

margin levels right now. 

Now, the good news is, the hog sector has shown great productivity. Dairy, looking at milk production per cow, that has gone up 

some. So these margins have declined, but that has been offset a 

little bit by increased productivity. But there is no question right 

now, it does not matter which species you are looking at, they have 

been under very tight margins, and particularly for those who depend on pasture. I think that is the double-whammy, if you will, 

because not only are you facing high feed costs, you are looking at 

very limited pasture opportunities. 

So to the degree that those things have impacted beef and hogs, 

and as we mentioned earlier in answer to, I think, Senator Roberts, 

these have been very, very tough times, and hopefully, with this 

year, if we can get a return to more normal yields on the feed grain 

side, soybean side, we should see some softening in those feed 

prices towards the end of the year and then, hopefully, some spring 

rains to get pasture conditions back up. 

Chairwoman STABENOW. Thank you very much, and I will now 

turn to Senator Grassley. 

Senator GRASSLEY. I am sorry I missed your testimony, but I had 

two other committee meetings this morning and I am glad to get 

here, because this is such an important issue, particularly, it looks 

like the maps I see of my State and maybe even further West than 

my State, things are bad, but particularly in the Western part of 

my State. 

So something Senator Klobuchar started on, I want to follow up 

on. Some of this improvement, where we did not have quite the reduction in production as we thought we would have. It, of course, 

is due to better practices and modern technology. A lot of it is the 

improvement of seed technology. Dr. Glauber, how important have 

biotechnology-derived seeds been to farmers in producing crops in 

these drought conditions? And I am asking this question, I think, 

even before a couple years—it is a couple of years before we have 

what you call drought-resistant corn seed available. 

Mr. GLAUBER. No, that is right, but you are absolutely right. 

What has been developed of the crop developments that we have 

seen have really been very instrumental in sort of preventing a 

22 

much more catastrophic impact on crop yields this year, at least in 

2012. 

If you look at the weather, and Dr. Pulwarty went through this 

pretty well, very similar to 1988 in terms of the intensity of the 

drought. But remember, in 1988, you had fields that came out with 

no corn, and all things considered, we took four billion bushels off 

our corn crop estimate by the end, but that was about the size of 

the 1988 crop. Because of the no-till practices, and a lot of that has 

been helped by biotech varieties, and because of the developments 

in seed varieties, I think we were able to get a much better crop 

than we would have had otherwise. 

Senator GRASSLEY. Yes. For Senator Stabenow, you just answered her question about livestock problems. I would like to continue on, if you could discuss the problems that will have for the 

renewable fuel industry faced by the lessened production, the higher prices, et cetera, the challenges you see ahead for that. 

Mr. GLAUBER. Well, two things on the renewable fuels. I think 

that, clearly, this past year, because of the high corn prices, we saw 

a reduction in margins for ethanol producers and we saw a cutback 

in production. If you look at the weekly levels of ethanol production, they took a big dip about mid-July when corn prices came up. 

They have been remaining below, well below, the caps under the 

Renewable Fuel Standard for conventional fuels. We have revised 

our estimates downward for corn use for ethanol, down to 4.5 billion bushels. We anticipate that they will remain low over the 

course of the next year. 

The other major thing going on with the Renewable Fuel Standard, of course, is also the so-called blend wall, and there, that refers to how much ethanol can be put into the gasoline supply. 

There, because of declining fuel consumption, because of improved 

fuel efficiency, because of other factors, that has put a ceiling on 

how much ethanol can be blended. But the hope, or at least, I 

think, the main thing driving it for the time—for at least over the 

last year or so—has been higher corn prices. I think, looking forward, it is going to be this blend wall which will be the real challenge to the industry. 

Senator GRASSLEY. Okay, and my last question, if I could, 

Madam Chairman, is, you know, with just one or two percent of the 

people producing most of the food in this country, there is not as 

much understanding of agriculture, and you always read about food 

prices going up. Speak to me, as best you can, what direct correlation there is between consumer prices and the problems of drought 

and which causes the price of agricultural products to go up. 

Mr. GLAUBER. Well, that is a great question, and I get this all 

the time because people often talk about commodity prices as food 

prices. And, of course, for something like corn, you are a very long 

way from a plate of food that you might purchase. For some products, obviously, the difference between a farm-level price and the 

retail price is closer. For things like corn, of course, you are talking 

about what goes into an animal that then gets processed and then 

ends up being sold as meat to consumers. 

If you look at the total value of farm products in the retail food 

dollar that we spend, that is about 14 cents. So even large increases in commodity prices have fairly small impacts on consumer 

23 

prices. That is not to say that they are not significant. If you look 

over 2007–2008, you look at this most recent period, 2011–2012, 

and I have—I think in my testimony there is a chart on this—it 

shows the monthly inflation rates looking at the year before, so the 

change, say, from December 2012 vis-a-vis 2011. And you can see 

that we have now come down to a very low level of inflation. I 

think the most recent levels that BLS reported for food at home 

was about 1.3 percent, and that is well below the two to three percent that we saw a lot over the last 20 years. 

However, back in 2007–2008, floor inflation rose about seven percent. It has come down. We will see some increase, I think, due to 

the current food prices. The Economic Research Service is forecasting food inflation of around three to four percent. But, again, 

a far cry from the 26, 30, 40 percent increases in commodity prices 

that we saw in the summer. 

Senator GRASSLEY. In closing, let me give you an admonition 

from your position of respect as an economist, and particularly in 

the Department of Agriculture. Do not let people get away with 

saying that 40 percent of our corn crop goes for ethanol when considering one-third of the bushel of corn is still available for animal 

feed, which then would bring that down to 20 to 25 percent of the 

corn crop that is used for ethanol. 

Mr. GLAUBER. Well, you are absolutely right. The distiller dry 

grains, the other byproducts from ethanol production, have become 

a very central portion of the overall feed diets of a number of these 

livestock groups. Thanks. 

Senator GRASSLEY. Thank you, Madam Chairman. 

Chairwoman STABENOW. You are welcome. Thank you. 

Senator Donnelly. 

Senator DONNELLY. Thank you, Madam Chair. I just have a couple of questions. 

To Mr. Glauber, and I apologize if these have been asked. I was 

at an Armed Services Committee hearing that I had to go to. You 

had mentioned about the debt-to-asset ratio for those with crop insurance. Do you have any idea right now what the debt-to-asset 

ratio is for those producers of crops for which insurance is not 

available? 

Mr. GLAUBER. No, thanks; actually, the debt-to-asset ratio that 

I mentioned was for the aggregate, for the entire U.S. farm sector. 

And as I said earlier in my remarks, you have to be very, very 

careful of the aggregate. 

Let me see if we can coax that out of the numbers, and I can go 

back and look to see if we can get a breakout for those numbers 

and get back to you. I mean, obviously, this year, there is no question that if you were a field crop producer and you had high coverage levels, if you have a revenue product, the crop insurance was 

a big boost and helped you maintain—offset those losses. 

Senator DONNELLY. Thank you, Doctor. 

Dr. Pulwarty, you mentioned the collaboration between NOAA 

and USDA to try to be able to better handle drought and drought 

situations. Are there any other tools that you can think of that 

would help us in minimizing the impact of these droughts? 

Mr. PULWARTY. Thank you for the question. There are several 

practices that are there, that people in USDA and elsewhere, and 

24 

our farmers, have been doing for a long time. In fact, that is why 

we are still there. 

From the standpoint of an understanding of the impacts of 

drought, there is a lot that can be learned from this present event 

that we are going through that can help us stave off longer-term 

risks. I think Mr. Bennet and others mentioned knowing the fact 

that some things that we put into place up front. For a long time, 

we have learned, if you put in a dollar up front, you can save three 

to four dollars in drought mitigation practice in the long term. 

Looking more effectively at our observations, our satellite-based 

observations of where there might be risks to crops, what lands 

might be fallowed so that the price of the water can be used by the 

farmer for other purposes, is an avenue that we should probably 

pursue, simply because if we are not—if we can get the prices for 

the crops, that is fine. If we can get a higher price for the water, 

then the farmer should keep the right to the water but also be able 

to sell it when he or she can. 

From that standpoint, we have projects with USDA and others 

in the State of California on what areas might be likely to be 

fallowed during a drought such that, up front, one can see there 

is an amount of water that can be saved that can be sold somewhere else. 

There is quite a bit of early warning information that leads to 

making those types of decisions, and if I can be clear about it, the 

idea of having better improved monitoring for soil moisture is really the missing piece, coordinated across all of our agencies. We 

have good pieces of soil moisture data, but effectively coordinating 

the soil moisture, what we know about it across NOAA, USDA, and 

others, I think is extremely critical. 

From that standpoint, we can also point to the ideas that you 

have heard today of looking at where we have programs like EQIP, 

WHIP, and the Conservation Program as to how to effectively design those programs for extended drought. We are really good at 

the onset of drought. We have the markets that can take care of 

it. We have the storage that can take care of it. 

But as was mentioned earlier, when you get to places like Texas, 

when we get into a deep drought and the price of purchasing feed 

and so on goes up, all of a sudden, we are rapidly selling off. And 

so we have worked very closely with the State and others on what 

is the likelihood of meeting those thresholds. So, from our standpoint, finding out where the thresholds for making those decisions 

are and how best we can provide information from an economic 

standpoint to secure the investments. 

As a last statement, that is actually the basis of an MOU that 

NOAA signed with the Western Governors Association and we can 

look to sort of learning from how we think about where to place 

our investments over the long term. 

Senator DONNELLY. Thank you very much, Doctor. 

Thank you, Madam Chair. 

Chairwoman STABENOW. Thank you very much to both of you for 

a very important discussion about the challenges facing our ranchers and farmers going forward. We appreciate and we look forward 

to working with you. 

25 

This would conclude our first panel. We would ask our second 

panel to come forward. Thank you. 

[Pause.] 

Chairwoman STABENOW. Well, good morning again, and we are 

so pleased to have this panel with us. I know, as others have been 

here in the past understand, we have multiple commitments that 

members are trying to be able to meet this morning. Cloning might 

be good for the committee structure here. I know we are working 

on that in agriculture. But Senator Cochran had to step out to an 

Appropriations meeting, but certainly it does not reflect his interest, and others will be coming and going, as well, this morning. 

We so appreciate all of you being here. We will introduce all of 

our witnesses and then ask you each to speak for five minutes, and 

we welcome any other written testimony that you have. 

I am first going to turn and ask Senator Baucus to introduce the 

distinguished first panelist, Leon LaSalle. Senator Baucus. 

Senator BAUCUS. Thank you, Madam Chairwoman. 

It is a real honor for me to introduce Leon LaSalle. Leon is a Native American rancher. The real deal, several generations. His 

grandfather, Frank Billy, is one of the first to found the ranch on 

the Chippewa Cree Reservation of Montana. It actually is part of 

the Rocky Boys Reservation. We have got seven reservations in 

Montana. Leon and his family are real stalwarts, and one of the 

reservations is Rocky Boys and the Chippewa Cree are the Tribal 

members in that reservation. They raise Black Angus around the 

Bears Paw Mountains between Rocky Boys, up around Havre, Montana. It is sort of a real standout, that is, as a landmark in our 

State. We are very proud of it. 

Leon was featured in a book. The book was called Big Sky Boots. 

It is the working seasons of a Montana cowboy. He has a great 

quote in that book. He said he thinks there is a growing disconnect 

between the general public and agriculture producers. Well, Leon, 

I have got to tell you, the same thing is true in Washington, D.C. 

There is a disconnect between the people here and the people who 

represent the rest of the country, and maybe you can kind of help 

connect those dots a little bit here when it comes time for you to 

testify. 

We are really very honored to have you here because you are a 

great credit to the Tribe and to the State of Montana and your industry. I might say, Leon is also on the Board of Directors of the 

Montana Stockgrowers and one of the guiding lights there, as well, 

so thank you very much. 

Chairwoman STABENOW. Thank you, Senator Baucus. 

I was holding up—I felt like Vanna White for a moment. 

Senator BAUCUS. There it is. 

Chairwoman STABENOW. I was holding up the book. Mr. LaSalle 

has given this to us and the committee. 

Senator BAUCUS. You have got it. 

Chairwoman STABENOW. We will keep it here in a place of honor 

and look forward to having a chance to look at it, as well. 

Senator BAUCUS. You bet. 

Chairwoman STABENOW. Mr. LaSalle, as I told you privately, nobody fights more for Montana agriculture than Senator Baucus, so 

thank you. 

26 

I am going to turn now to Senator Donnelly and ask him to introduce our second witness. 

Senator DONNELLY. Thank you, Madam Chair. 

Chairwoman STABENOW. Ranking Member Cochran, and other 

members of the committee, I am looking forward to us working together to address the important issues facing our nation’s farmers 

and we are fortunate today to have with us Anngie Steinbarger. 

Anngie is a Hoosier corn and soybean farmer from Shelby County 

who took the time to come out here to Washington to share her 

perspective on conservation practices, crop insurance, and the risk 

management techniques critical to operating a farm in the 21st 

century. 

As the folks testifying before the committee today have made 

clear, we need to find the appropriate balance between strong crop 

insurance and disaster assistance programs that provide robust 

support for our producers when they need it, but are also fiscally 

responsible. As Anngie will tell you, last year’s growing season was 

extraordinarily challenging. We had a very, very significant 

drought situation in Indiana. Anngie and her family faced it on 

their family farm and she is going to share some of that with us 

today. 

Anngie and her husband had always dreamed to farm, and 

through their hard work, dedication, and thrift, they have managed 

to grow their operation to 1,500 acres. She and her husband are 

a great example to us here on the committee. We owe it to the 

Steinbargers and every other agricultural producer in the country 

to roll up our sleeves and to get a farm bill as soon as possible, 

as well, Madam Chairwoman. 

Thank you, Anngie. 

Chairwoman STABENOW. Well, thank you very much. We are 

pleased to have you. 

I now want to introduce from Leelanau, Michigan, Jeff Send, who 

is a lifelong cherry farmer. And I do have to say that Mr. Send has 

given us chocolate-covered cherries that will not remain in the committee longer than the end of this day. They will be gone. So thank 

you. Thank you very much for bringing that. 

But Mr. Send is a lifelong cherry farmer who grew up working 

on his grandfather’s 40 acres. He and his wife, Nita, have now expanded that farm to 800 acres of sweet and tart cherries. Mr. Send 

has also operated a receiving station for over 35 years with 35 

growers bringing cherries to his station. He is currently the Vice 

Chairman of the Cherry Marking Institute Board of Directors and 

Vice Chairman of the National Cherry Growers and Industries 

Foundation. We are so pleased to have you here today. 

Last but certainly not least, Mr. Steffen, Ben Steffen, who was 

introduced earlier by Senator Johanns. He is President and coowner of the production operation Steffen Ag, Incorporated, which 

milks 135 cows, raises crops on 1,900 acres, and has six full-time 

employees. He currently sits on the President’s Advisory Board of 

his alma mater, the University of Nebraska, and serves as President Elect of the Ag Builders of Nebraska, and formerly the President of the Richardson County Farm Bureau and County Extension. 

27 

So we welcome each of you and we will ask Mr. LaSalle to begin 

his testimony. 

STATEMENT OF LEON LASALLE, RANCHER, HAVRE, MONTANA 

Mr. LASALLE. Thank you, Chairwoman Stabenow, Ranking Member Cochran, Montana Senator Baucus, and members of the committee, for this opportunity to share my experiences regarding the 

Federal Livestock Disaster Programs. 

My name is Leon LaSalle and I am a Native American rancher 

from Rocky Boys Indian Reservation, approximately 100 miles 

northeast of Great Falls, Montana. I am President of LaSalle 

Ranch, Incorporated, a family ranch corporation including my wife, 

Shannon, my parents, Robert L. and Jenny, my brother, Robert W. 

and his wife Susie. Together, we raise Black Angus cattle near the 

beautiful Bears Paw Mountains and the reservation. 

I serve as a Board of Director for the Montana Stockgrowers Association and as President of the Rocky Boys Cattlemen’s Association. My maternal grandfather, Frank Billy, and his sons were 

among the first residents of Rocky Boys to become cattle ranchers, 

and today, as in the past, we manage our ranching operation with 

future generations in mind. 

We have installed numerous conservation practices specifically 

designed to preserve and protect our natural resources. Even 

though we have implemented these conservation measures, there 

are times when my family’s ranch has been struck so hard by 

weather-related disasters that we have sought economic assistance. 

The Federal Livestock Disaster Programs have been that assistance. 

We have participated in the Federal Disaster Program since the 

mid-1980s. One thing that has always been a problem was the 

need to have Congress pass legislation for these programs to proceed. That changed in the 2008 farm bill, where, for the first time, 

Livestock Disaster was included. Those years when we have used 

these programs to help offset the financial sting of a drought or a 

blizzard are tough years. I have known this is especially true for 

Native American ranchers. 

The Native American Livestock Feed Program is a great example 

of a program that helped when feed was short. In drought years, 

when there is little or no hay to feed our livestock, ranchers like 

me must purchase hay at a premium. Sometimes by the time the 

hay reaches the ranch, the freight is more than the cost of the hay 

itself. Our family has used the Emergency Livestock Assistance 

Program in 2008 when our ranch qualified for a payment to purchase replacement hay. We also currently have a Livestock Indemnity Program application pending. The loss resulted from a blizzard 

during the winter of 2010–2011. 

These programs provide the only financial relief available when 

a rancher was faced with loss of livestock or forage to feed them. 

There is no insurance for catastrophic livestock losses, such as 

those experienced by Southeastern Montana ranchers during the 

horrific wildfires of 2012. 

I have helped neighbors prepare applications for LIP, and on one 

sad occasion, I participated as a third-party witness when several 

28 

cattle fell through the ice and drowned while trying to shelter 

themselves from a stinging Montana blizzard. 

While these programs are a welcome relief, they also come with 

some frustration. Livestock producers like me typically do not work 

with the FSA on a regular basis and the FSA office is an unfamiliar experience with unfamiliar rules. For example, a ranch family in Blaine County lost 160 ton of hay when lightning struck their 

haystack. Their application was denied because the rancher had 

not purchased crop insurance on a small field of hay barley. There 

also is a rule requiring an operator to report a loss within 30 days. 

This time period needs to be extended. Losses may not have even 

been assessed in the 30 days. When a disaster is occurring, seldom 

has the thought crossed my mind that I need to document my 

losses. I am normally just struggling to keep my calves from freezing to death. I will count them later. 

I believe these disaster programs should become continuous programs that have a stability that would benefit both the livestock 

producer and FSA. Many of the problems we as livestock producers 

have stem from FSA’s documentation requirements and the failing 

of livestock producers to gather the type of data FSA requires. Program consistency would help with this. 

Mother Nature throws a variety of natural events in the path of 

a Montana rancher. Our weather is uncertain, sometimes severe. 

We find our markets are even vulnerable to the effects of drought, 

as well. Drought has reduced the number of cattle available, and 

processing facilities have closed as a result, thus affecting our 

price. If weather and markets are not the issue, then many of my 

fellow ranchers are challenged by the ever-increasing predator 

losses. 

In summary, I would suggest the following changes. One, the 

current system for determining drought needs to be revised. 

Droughts can be very local. 

Two, the whole crop insurance thing needs to be dropped from 

livestock eligibility criteria. 

Three, these programs need to be handled differently from other 

FSA programs. In most cases, they are working with an entirely 

different crowd than those historically served by FSA. 

Four, a streamlined process encouraging program participation 

would be a welcome change. 

Five, consistency. The program needs to be made permanent; six, 

the 30-day reporting deadline needs to be extended. 

In closing, I want you all to know that I am proud of my family 

and my Native American heritage, and I am equally proud to be 

a Montana rancher, working every day to deliver safe, healthy, environmentally wholesome beef to your families and to families 

throughout the world. Thank you. 

[The prepared statement of Mr. LaSalle can be found on page 74 

in the appendix.] 

Chairwoman STABENOW. Thank you very much. 

Ms. Steinbarger. 

29 

STATEMENT OF ANNGIE STEINBARGER, FARMER, 

EDINBURGH, INDIANA 

Ms. STEINBARGER. I would like to thank you, Chairman Stabe- now and Senator Donnelly, for that nice introduction, and the committee members for allowing me the opportunity to comment. My husband and I began farming the family farm in 1989, just after the last big weather event of 1988, which was the drought. 

Thanks to our ability to manage financial risk, management techniques, and off-farm income, we now farm 1,500 acres of corn and 

soybeans as well as a small cow-calf operation in the State. We find 

our association with various farm organizations, such as the Indiana Soybean Alliance, invaluable to the success of our operation. 

The Indiana Soybean Alliance is an arm of the American Soybean 

Association, a trade organization that represents our nation’s 

600,000 soybean farmers on national and international policy 

issues. 

It has always been our dream to farm. My husband and I both knew that the only way to make our dreams a reality were to save 

our pennies and work off-farm incomes in hope that, one day, my 

father would give us the opportunity to participate in the farming 

operation. Mike worked in the seed, tile ditching, and bulk milk 

transport business while I worked in fertilizer, chemical, and crop 

insurance businesses. 

The drought of 1988 took a toll on my father. Poor health, no crop insurance, and no crop led us to the ability to participate into 

the family farm. We started farming 600 acres and have increased 

the operation to 1,500 acres. Roughly one-half of our acres are on 

a share arrangement with our landlords. We continue to work offfarm, as it is still not self-supporting. Mike sold the milk truck to 

buy a school bus and I continue to work in the crop insurance and 

do the farm recordkeeping. 

To manage our thin, light soil types, we started our farming operation employing conservation tillage techniques, using such programs as CRP and NRCS cost share funding. To this day, we are 

still advocates of no-till farming as a way to preserve our soil and 

maintain soil moisture. As a result of our conservation efforts, our 

average yields are 150 bushels of corn and 50 bushels of soybeans. 

My father warned us that farming is very risky and we should 

prepare for the worst case scenario. We did not anticipate the 

record-breaking drought and heat when we planted our 2012 crop. 

The crop was planted timely and we were concentrating on installing an irrigation pivot on 35 acres of really sandy soils in hopes of 

raising 200-bushels-plus corn per acre under the pivot and around 

170 bushels on our non-irrigated soils. 

The middle of June, it became apparent that we were not going 

to realize our crop goals. The heat and drought had settled in to 

stay. It is so frustrating to watch the crop wither and die. I actually used our fields as training examples of permanent wilt and 

drought stunted corn. I just happen to have a couple pictures that 

I submitted to the committee. 

The race was on to get our irrigation pivot operating. Due to a 

storm, we did not water the crop until July 6. We also bought back 

some of the grain that we had contracted to the elevator for our 

landlords. We were concerned that our corn crop would not raise 

30 

40 bushels to the acre, and about 40 bushels is the most we ever 

contract for a landlord per acre. Our best corn was on the farm 

with the pivot. Under the pivot, it was 200 bushels to the acre. And 

outside of the pivot, ten. 

This farm averaged 100 bushels to the acre, and that allowed us 

to meet our contracts. The rest of the crop was dismal. Needless 

to say, there was not anything to put in the grain bins. Due to the 

drought and heat, the grain quality was very poor and we even 

shipped our grain that was going to be fed for livestock. 

We always live on the proceeds of the crop year following the 

year we produce it, so we will be feeling those effects of the drought 

of 2012 in 2013. 

The number one barrier to increasing our yields is the lack of 

water. Dry weather in the months of July and August always limit 

our yield potential. We find crop insurance an effective tool in managing risk when we experience these weather events. We began 

using crop insurance in 1991 as a way to maintain our cash flow 

and prevent us from having to borrow money. I actually have lost 

money over buying crop insurance over the last 20-year time span. 

It was not until the last two drought years that it actually paid for 

us to have crop insurance. 

Using crop insurance as a risk management tool is not cheap. We 

have Revenue Plan 2 coverage and optional unit structure and insure 80 percent of our corn average yield and 75 percent of our soybean average yield. This roughly costs us $38 an acre for corn and 

$20 an acre for soybeans. This plan does allow us to be covered for 

differences due to poor yield or a poor price or actually a price fluctuation that goes up. 

The yields from 2012 were the lowest on record for our farm. The 

average corn yield was 41 bushels to the acre. By the way, that is 

worse than 1988. And, actually, the soybeans averaged 30.4, which 

were marginally better. It ended up being one of our best decisions 

to purchase the irrigation pivot. 

As you can see, we paid a substantial premium for crop insurance, and that decision is keeping us in business for the 2013 crop 

year. 

Thank you, Chairman, for this opportunity to testify and I look 

forward to your questions. 

[The prepared statement of Ms. Steinbarger can be found on 

page 117 in the appendix.] 

Chairwoman STABENOW. Thank you very much. 

Mr. Send. 

STATEMENT OF JEFF SEND, CHERRY FARMER, LEELANAU, 

MICHIGAN 

Mr. SEND. Thank you, Senator Stabenow, and members of the 

committee, for inviting me to testify today and for your concern 

about a very important issue. 

I am Jeff Send. I am a cherry farmer from Northern Michigan, 

and I grew up working my grandfather’s 40 acres. Now, my wife 

and I, Anita, farm 800 acres of sweet and tart cherries. Putting 

some of the land into the Federal Farm and Ranch Land Protection 

Program is one of the tools we use to expand our operation. Our 

31 

youngest daughter and her husband work with us and they someday hope to take over the farm. 

I also have managed a receiving station for 37 years. I have a 

working relationship with 35 growers who bring me cherries to be 

weighed, inspected, shipped to ten different processors in Michigan, 

Wisconsin, and the State of New York that I work with. 

I currently am serving as Vice Chair of the Cherry Marketing Institute Board. CMI is a national organization for tart cherry farmers. I am also a Vice Chair of the National Cherry Growers and Industries Foundation, which is a sweet cherry organization. 

Year in and year out, Michigan produces 75 percent of the 

United States tart cherries. However, that was not the case in 

2012. Last year was the most disastrous year I and the cherry industry have ever experienced. Our winter was much warmer than 

normal, with little snow and ice on the Great Lakes. In mid-March, 

there were seven days of 80-degrees temperatures, which is unheard of in Northern Michigan. Cherry trees began to come out of 

dormancy and began to grow. This left them completely vulnerable 

to the next 13 freezes in April. This extreme weather in Michigan 

was one of the worst disasters we had ever seen. Sweet cherries endured freezes slightly better than tart cherries. But to top things 

off, we were hit with a worst case bacterial canker I had ever seen. 

There is no treatment for this disease, which affects the fruit buds. 

In Michigan, we have the capacity to grow 275 million pounds of 

tart cherries. In 2012, our total was 11.6 million pounds. If this 

would have happen a year sooner, the SURE program would have 

been in place and we would have had some form of safety net. 

There is no tart cherry insurance available at all for our industry, 

so my fellow growers and I had no risk management tool to get 

through this very difficult year. 

NAP insurance is available, but the policy starts at 50 percent 

loss and then pays out only 50 percent of that number. Farmers 

are left with only about 25 percent of coverage, and there is a 

$100,000 cap. This does not come close to covering our expenses. 

My costs on my farm alone are between three-quarters and a million dollars. 

Tree fruits must be maintained whether there is a crop or not 

on them. You carry on with the same practices in order to keep 

them healthy. So expenses remain the same. Imagine working for 

a year-and-a-half with no paycheck and still having the same expenses. 

There is a pilot program for sweet cherries that is available in 

two counties. Fortunately, I live in one of the two counties. What 

it meant to me was 50 percent of my sweet cherries were covered. 

However, the farmers that I represent in neighboring counties did 

not have the option to purchase sweet cherry insurance. 

The Administrator of RMA visited last summer and we are working on a tart cherry program, which I hope will be up and running 

for the 2014 season. 

I worry about our young farmers, who haven’t built up any equity. No income with all the same expenses is formula for disaster. 

There needs to be something to help farmers stay in business when 

natural disaster hits. A few days that we have no control over can 

put us out of business. 

32 

In closing, I would like to thank you for being able to testify here 

today. I also would like to leave you with three points. 

Number one, disaster relief is very important to the tree crop industry. 

Number two, long-term crop insurance needs to be available to 

all farmers who grow food in the United States. 

Number three, where no crop insurance is available, we need to 

improve the NAP policies to provide farmers with better risk management tools. 

I am very worried about 2013 and what this year will bring. We 

must have a good crop so growers and the industry can get back 

on their feet. Another year with some form of safety net will put 

a lot of us out of business. 

Thank you for your time. 

[The prepared statement of Mr. Send can be found on page 98 

in the appendix.] 

Chairwoman STABENOW. Thank you very much. I know how serious this is. 

Mr. Steffen, welcome. 

STATEMENT OF BEN E. STEFFEN, FARMER, STEFFEN AG, INC., 

HUMBOLDT, NEBRASKA 

Mr. STEFFEN. Good morning, Chairwoman Stabenow, Ranking 

Member Cochran, and members of the committee. I want to thank 

Senator Johanns for his earlier introduction and I want to thank 

all of you for your leadership and hard work on behalf of our nation. I salute your commitment to public service. 

My family, our employees, and I produce milk, corn, soybeans, 

wheat, and hay on our farm at Humboldt in Southeast Nebraska. 

We milk 135 cows on 1,900 acres of non-irrigated dryland farm, 

and I have family members at home right now caring for and feeding animals so that I can be here today. 

This nation has benefited from a food supply that is plentiful, inexpensive, and of the highest quality, and securing that food supply 

for the future is clearly a responsible public policy. Facing a growing world population, it is a moral imperative. 

The impact of fire and drought has hit our farming operation and 

those of our neighbors. The price of high-quality dairy hay has gone 

up by 50 percent, and the price of lower-quality hay suitable for 

beef animals has more than doubled. While we appreciated last 

year’s release of Conservation Reserve Program acres for emergency haying and grazing, we would like to see efforts made for an 

earlier release date for those acres. This would dramatically improve the quality and the quantity of those forages. 

My neighbors in Western Nebraska have been dealt a particularly hard blow by wildfires, and nearly 400,00 acres, approximately half the State—equivalent to half the State of Rhode Island—were burned in 2012. On those ranches, feed supplies were 

wiped out, fences were destroyed, and cattle have been liquidated. 

I would urge you to consider some tax relief to help those ranchers 

regain their footing. Ladies and gentlemen, our nation’s cattle herd 

is at a 61-year low and consumers will feel this damage for years. 

I would also note that the farm bill which passed this body addressed the reauthorization and funding of a number of important 

33 

Livestock Disaster Assistance Programs which were not funded for 

2012 or in the recent farm bill extension, and the funding of those 

programs should be a top priority for this committee as we look toward passing a farm bill this year. 

Livestock contributed $10 billion to Nebraska’s economy in 2011 

and crop production contributed $11.7 billion. I have seen that in 

my own operation as well as in my community, where I sit on the 

Board of Directors of the Richardson County Bank, and that money 

moves through virtually every business and community in our 

State. 

In the crop production arena, we can all say with pride that the 

Federal Crop Insurance Program has worked well. For us, Federal 

crop insurance is not a fountain of free money. Until last year, our 

farming operation had an 11-year crop insurance purchasing history that showed us paying in more money in premiums than we 

received in indemnity payments. Last year, the insurance program 

appropriately covered a portion of our massive losses. We choose to 

participate and pay premiums every year to protect our operation 

from an event like the history losses of 2012, and producers across 

the nation have endorsed this program with their massive participation. I would urge you to consider changes that would allow the 

individual policies to be customized to more closely fit each farm, 

but maintaining the successful Federal Crop Insurance Program 

should be our highest priority. 

Risk management strategies that have contributed to our success 

include many tools, and the idea that Federal crop insurance alone 

guarantees a profit is simply not true. Other tools play a major role 

in controlling risk and increasing the chances of success. Education, hard work, and determination come to mind. My parents, 

Richard and Sue Steffen, both graduates of the University of Nebraska, ensured that their children would have a college education, 

as well. They set a high standard for education, for hard work, and 

determination. 

Another risk management tool that we employ is diversification. 

We include both livestock and crops in our business. In order to 

manage price risk, we constantly watch the changing world markets and the prices for the products we sell, and we accept the 

challenge of using futures and options contracts. But we, along 

with thousands of other producers and processors, were victimized 

by the genius of mismanagement at MF Global when our accounts 

were frozen in the subsequent bankruptcy. We continue to wait for 

the return of a slowly rising percentage of our funds. 

We work every day to find and apply the best management practices, and we have relied on the Land Grant University Research 

and Extension System established by the Morrill Act of 1862 to 

help us move our business forward. This has led us to nearly 40 

years of no-till farming, saving water, soil, and time. And thanks 

to Land Grant Research and Extension, we have dramatically improved the way we care for and feed our milk cows, leading to higher production, improved herd health, and better quality milk. 

To further protect our soil and water, we began using cover crops 

years ago. But participation in the Conservation Security Program 

gave us a push to go beyond the program requirements, and last 

year, we planted nearly 60 percent of our acres to cover crops. This 

34 

practice holds great promise for conserving our soil, saving water, 

building quality, and sequestering carbon, but we need more research in this area. I urge Congress and this committee to 

prioritize funding for both basic and applied agricultural research 

and our Land Grant system of universities created by the Morrill 

Act of 1862. This research and development is the engine of our nation’s food supply. 

I conclude as I began. This nation has benefited from a food supply that is plentiful and inexpensive and of the highest quality. Securing that food supply for the future is clearly responsible policy. 

Facing a growing world population, it is a moral obligation. 

Thank you. 

[The prepared statement of Mr. Steffen can be found on page 112 

in the appendix.] 

Chairwoman STABENOW. Thank you very much to each of you. 

You are all on the front lines of making sure we have a safe, abundant food supply in the riskiest business in the world, so we thank 

you very much. 

Mr. LaSalle, you talked about the livestock disasters and some 

changes you would like to see. I am very pleased to say that most 

of those, we put in the farm bill we passed in this committee and 

in the Senate, and we are going to continue to push for those. 

Mr. Send, as you know, we addressed disaster assistance in our 

farm bill. 

Mr. Steffen, I would just say, on MF Global, we are working. 

This committee also has oversight and we are laser focused on 

making sure you get every penny of your money back, so we are 

going to keep pushing on that. 

Mr. Send, talk a little bit more, if you could, about the difference 

in the coverage options for you—the limited coverage that you have 

under crop insurance right now with your sweet cherry insurance 

policy versus the current NAP program and how this all fits for you 

when you are trying to put it together with limited options. 

Mr. SEND. Thank you, Senator. I think I touched on it a little bit 

when I said $100,000. A hundred-thousand dollars does not cover 

much. If I could have crop insurance like the Sweet Cherry Insurance Pilot Program, you would pick your policy. Your policy runs 

all the way from 50 percent coverage to 75 percent coverage. This 

last year, I had 50 percent coverage. I was very, very happy. I was 

very fortunate I lived in one of the two counties. Since the episode, 

I increased my coverage for next year because my fear is this possibly could happen again. So there will be more monies coming 

there. 

The NAP program, you know, the $100,000 just does not get it. 

We need a policy that we, as growers, can buy and set some form 

of coverage up for ourselves so we have some form of tool that we 

can fall back onto, because I, too, feel our climates have changed. 

I fear that it could affect all of us sitting at this table. But we have 

no crop insurance, and if we do not get it, it is going to put many 

of us out of business. 

Chairwoman STABENOW. Could you speak, also, just for a moment, about the costs of maintaining the orchards and so on regardless of the situation. Your costs do not go down just because 

you do not have a crop. 

35 

Mr. SEND. Well, I think on the long version that I wrote, I 

touched a little bit. Our costs will be the same—I should not say 

that. Let me restate. Our costs are a touch cheaper because we did 

not have to harvest product this year. But if you look in the long 

version, I think I made a statement, spring came early, which 

meant we started five weeks sooner than normal. Your first sprays, 

your first fertilizer, everything, are the very, very most important 

things that you can do, and you have to do them. If you are going 

to stay in this long-run, I have a theory. You have to keep them 

happy and healthy. And if you do not do it, it is going to catch up 

to you later. 

So expenses pretty much this year were down a touch, but you 

have to fertilize, spray, do it all. I mean, we ended up with four 

extra sprays this year, and let me tell you, it is not cheap. 

Chairwoman STABENOW. Thank you. 

I would like to ask, Mr. LaSalle, Ms. Steinbarger, and Mr. Steffen, you all talked about additional risk management tools related 

to conservation practices, and I wonder if you might each just 

touch on, briefly, what conservation practices you use and how it 

makes it more resilient for you managing the drought and other 

disasters. Mr. LaSalle. 

Mr. LASALLE. Yes. Over the years, we have installed many, 

many miles of livestock water pipeline across fences so we could 

manage our grazing in a manner where we always—we leave some 

grass in our rotation that we never use in case we have a drought. 

And through some of the cost-share programs that are available, 

that has enabled us to put the—to drill wells, develop springs, pipe 

the water, install tanks. 

One of the other things that we have done is, also, we have installed the permanent livestock shelters. We have actually built 

them out there, so that when cattle are in a blizzard, they can actually get to a spot that hopefully keeps them from going to like 

what my neighbor experienced, those types of practices. 

Chairwoman STABENOW. Thank you. 

Ms. Steinbarger. 

Ms. STEINBARGER. Yes. Our conservation techniques, number one 

would be no-till farming. We are on thin, light soils. It does not 

hold moisture well. We found—started our farming operation using 

those no-till techniques where we do not disturb the soil, just plant 

into it, and that has worked very well for us. Also, we have used 

waterway projects, where we tried to make the best use of the 

water that we do have. And the other one would be filter strips, 

where you do farm near rivers and we find that—and we want to 

preserve all the soil that we can and those filter strips along the 

river not only allow us to maintain water quality, but also to maintain soil. 

Chairwoman STABENOW. Thank you. 

Mr. Steffen. 

Mr. STEFFEN. Thank you, Senator, for the question, and I would 

point—as I mentioned in my testimony, I would point again to the 

no-till techniques we have been using for 40 years on our operation, to save soil, conserve water, and improve our crops. I would 

also point out that we are making extensive use of cover crops, and 

those crops planted in conjunction with our traditional crops offer 

36 

us a way to catch more moisture and snowfall, to improve the way 

water and rainfall percolates into the soil and it is absorbed so that 

we are able to capture and store more water in that soil by using 

those cover crops. It is a way to increase the organic matter levels 

in the soil, and that makes the soil more productive and increases 

its ability to hold water. 

So those are all techniques that we use, and I would mention, 

again, the value of long-term planning and thinking and foresight, 

and it is imperative that producers continue to look forward and 

plan ahead to be able to weather periods of stress and drought, and 

that we raise awareness, as you are doing today in this hearing, 

of the necessity for planning ahead. 

Chairwoman STABENOW. Thank you very much. 

Senator Donnelly. 

Senator DONNELLY. Thank you, Madam Chair. 

Anngie, you had mentioned crop insurance allowed you to ensure 

that you had a budget for this year’s expenses. Can you talk about 

any important ideas you would like this committee to consider as 

we examine crop insurance and disaster assistance? 

Ms. STEINBARGER. Yes, I do have a couple items that are kind 

of on the forefront of my mind as we prepare for the 2013 year. As 

you consider a new farm bill, I am very concerned that we maintain subsidy for crop insurance. Maybe I should say direct payments that we have had in the past reward a farmer regardless of 

his ability or desire to participate in risk management. I feel with 

the Crop Insurance Program that if you want to play, you are going 

to pay, and that is just exactly what we have chosen to do, and I 

hope that you consider that same type of idea as we go forward. 

I think that would probably be the most important one as of right 

now. 

Senator DONNELLY. Thank you very much. And to all our panelists, I just want to tell you how much admiration we have for you. 

You are the people who feed our country, who have been an extraordinary positive part of our export program, who have been 

stewards of our land, and who have left our nation’s lands in the 

extraordinary condition that they are in. To all of you, you have 

put your heart and soul into family operations. It is the epitome 

of American entrepreneurial spirit, of American enterprise, what 

you do. And so to all of you, thank you. 

Mr. Send, I will tell you, I happen to live up near the Michigan 

border. I am a proud Hoosier, but will tell you that our area is inundated with your products every year. So I just wanted to let you 

know that, as well. 

Thank you. 

Chairwoman STABENOW. Great. 

Senator Baucus. 

Senator BAUCUS. Thank you, Madam Chairwoman. 

Leon, a couple things. Following on Senator Donnelly’s point, it 

has always struck me how farmers and ranchers have a better perspective on life. They are more philosophical, Why? Because they 

know they can’t control their fate as much as some people in cities 

think they can, erroneously. You can’t control the weather. You 

can’t control price. Cost, you can’t control. You take what you get, 

but you have got to manage it as well as you possibly can. It is 

37 

very, very difficult and it is kind of humbling. It gives you a sense 

of life and the importance of hard work and doing one’s best. 

Whereas on the other hand, I think a lot of people in the city get 

a little arrogant and they think they can control everything, and 

obviously, they can’t. 

I was struck—I do not know if you saw it, the Super Bowl ad, 

a Paul Harvey ode, basically, to farmers and ranchers. It was very 

powerful. Now, it was an ad for Dodge Truck, but that was the 

main point. 

[Laughter.] 

Senator BAUCUS. The main point, it was just a powerful ode, 

statement, respect for the nation’s farmers and ranchers. I urge all 

of us who haven’t seen it to—or who did see it, just take that to 

heart, because it is so important. 

In our State, Madam Chairwoman, agriculture is our number one 

industry. It is number one. One out of five Montanans’ income is 

dependent upon agriculture. It has been that way ever since I have 

been around, and I expect it is going to be that way for a long time. 

And I just think, therefore, it makes sense—not just Montana, but 

other States—to get a little more sanity in some of these programs. 

And, clearly, one is Livestock Disaster Assistance. I mean, it is just 

incredible to me how wrong-headed it has been that prior to 2008, 

about 30 years, we have had this on again, off again, ad hoc disaster program. Farmers, ranchers do not know if Congress is going 

to act. Are they going to act? Are they not going to act? How much 

will they provide for? What years will it apply to? You have got to 

choose. It is just nuts. 

In my State, Madam Chairwoman, as we discussed, a lot of them 

are very inefficient. Sometimes, the farmer or rancher gets the payment when he or she should not just because the county got it, or 

vice-versa. It is just very inefficient. 

In fact, in the 30 years preceding the 2008 farm bill, about $60 

billion was paid in disaster assistance. That obviously comes out to 

about $2 billion a year. In the four years from 2008 to 2011, I think 

about $8 billion. Excuse me. Four-point-six billion was spent. So, 

roughly, we are two times more efficient under the permanent program than we were under the ad hoc program, basically. So it is 

cost effective, permanent Livestock Disaster Assistance, and that is 

basically why, in 2008, I authored the provision to make it permanent. Regrettably, we did not have money to keep it going over the 

ten-year period, but it just goes to the point of permanence, so 

farmers and ranchers can count it and know that it is there. 

Madam Chairwoman, I would say, when I am home, a lot of 

farmers and ranchers come up to me and say, boy, that estate tax 

provision you put in, that is great. First of all, the numbers are 

good. Second, it is permanent. It is not on again, off again. It is 

not a one-year program. It is not five. It is not ten. It is permanent. 

It just makes it easier for people that farm and ranch to conduct 

their operations when they can’t control the weather. You can’t 

control price. You can’t control cost. At least we can make things 

a little more stable for people. 

So I wonder if, Leon, you can just give us a sense of just all the 

problems you have been going through—you already did in your 

opening statement—because we do not have a program now. We 

38 

did. It expired at the end of 2011. But currently, all these things 

you have to go through. You mentioned the FSA offices. You mentioned the 30-day wait and all that, just very good points that we 

have to address. But could you just kind of compare what life was 

like before 2008 compared with what life has been since and now 

afterwards when we do not have it? Just add some flavor, because 

this is your chance. Just tell it like it is. 

Mr. LASALLE. Great. 

Senator BAUCUS. Do not pull any punches. Let us know. 

[Laughter.] 

Mr. LASALLE. Okay. Yes. Well, I mean, I think you kind of alluded to it there. Before 2008, we were always at—we were at the 

mercy of Congress to enact legislation so we had a program, and 

a lot of times, you know, that might be six months, a year, two 

years down the road from when the actual disaster occurred and 

we were still bleeding at those times, so to say, and we were looking for some relief. Unfortunately, you know, some people did not 

get that and it set their operations back—— 

Senator BAUCUS. You might explain, too, we have had floods, we 

have had droughts, we have had it all. 

Mr. LASALLE. We have had it all, yes, and actually, yes. What 

I alluded to here, we actually had the blizzard of 2010–2011 where 

we lost numerous heads of livestock. Well, following that, the following spring, then, we had unprecedented 100-year rainfall events 

that actually completely changed the landscape of our ranch and 

neighboring ranches. So we went from one extreme to the other. 

And then last year, we were at the tail end of this nationwide 

drought, but we were starting to feel it in North Central Montana, 

also. 

But without permanency, we just do not have anything to really 

go to the bank with, so to speak, because bankers, they love it, too. 

They like to know that, yes, we have insurance on these or we have 

some way of knowing that when I go down there and ask for an 

operating loan of X-amount, that I can somehow back it up. 

There again, these droughts, a lot of times in the old program, 

we had a county-wide—we may have had a county-wide designation or contiguous counties, and there were cases when maybe people who did not really have a drought were able to participate and 

get these payments. Like you said, Senator Baucus, you were paying out maybe more to people who did not really necessarily fall 

into the same category. And we have—our Montana Stockgrowers’ 

policy, we have actually addressed that in a resolution, that we 

would like to see some changes made to how droughts are designated, also. 

Senator BAUCUS. Yes. Thanks for what you do. I mean, you 

speak well for an awful lot of people and we deeply appreciate it. 

Mr. LASALLE. Thank you. 

Chairwoman STABENOW. Well, thank you very much to each of 

you. And we have committed, and I will emphasize again, we did 

pass permanent Livestock Disaster Assistance as part of our farm 

bill, as Senator Baucus certainly was the leader in making sure 

that happened, and we are committed to having the right kind of 

farm bill again as we move forward. 

39 

Let me just say, in conclusion, that we have heard from economic 

and weather experts about not only the drought of 2012 that rivaled the Dust Bowl era, but unfortunately, it appears that we can 

expect conditions that could be even worse this year. So that is 

something that certainly is very sobering today. But we have also 

heard from each of you, from people on the front lines, farmers and 

ranchers who suffered through the weather disasters and are 

counting on us to put in place risk management tools going forward 

that will help you be able to be successful, whether that is strong 

crop insurance for every crop that is interested in crop insurance 

or whether it is Livestock Disaster Assistance or the permanency 

of a five-year farm bill. It is so important that we get that done. 

We are committed to doing that. 

I want to thank each of you for coming, particularly people who 

traveled a long way today to be with us, and for the committee, any 

additional questions for the record should be submitted to the Committee Clerk five business days from today. That is 5:00 p.m. on 

Friday the 21st. 

With that, the meeting is adjourned. 

[Whereupon, at 11:49 a.m., the committee was adjourned.] 

(41) 

A P P E N D I X 

FEBRUARY 14, 2013 

42 


87563.001
43 


87563.002
44 


87563.003
45 


87563.004
46 


87563.005
47 


87563.006
48 


87563.007
49 


87563.008
50 


87563.009
51 


87563.010
52 


87563.011
53 


87563.012
54 


87563.013
55 


87563.014
56 


87563.015
57 


87563.016
58 


87563.017
59 


87563.018
60 


87563.019
61 


87563.020
62 


87563.021
63 


87563.022
64 


87563.023
65 


87563.024
66 


87563.025
67 


87563.026
68 


87563.027
69 


87563.028
70 


87563.029
71 


87563.030
72 


87563.031
73 


87563.032
74 


87563.033
75 


87563.034
76 


87563.035
77 


87563.036
78 


87563.037
79 


87563.038
80 


87563.039
81 


87563.040
82 


87563.041
83 


87563.042
84 


87563.043
85 


87563.044
86 


87563.045
87 


87563.046
88 


87563.047
89 


87563.048
90 


87563.049
91 


87563.050
92 


87563.051
93 


87563.052
94 


87563.053
95 


87563.054
96 


87563.055
97 


87563.056
98 


87563.057
99 


87563.058
100 


87563.059
101 


87563.060
102 


87563.061
103 


87563.062
104 


87563.063
105 


87563.064
106 


87563.065
107 


87563.066
108 


87563.067
109 


87563.068
110 


87563.069
111 


87563.070
112 


87563.071
113 


87563.072
114 


87563.073
115 


87563.074
116 


87563.075
117 


87563.076
118 


87563.077
119 


87563.078
120 


87563.079
121 


87563.080
122 


87563.081
(123) 

DOCUMENTS SUBMITTED FOR THE RECORD 

FEBRUARY 14, 2013 

124 


87563.082
125 


87563.083
126 


87563.084
(127) 

QUESTIONS AND ANSWERS 

FEBRUARY 14, 2013 

128 


87563.085
129 


87563.086
130 


87563.087
131 


87563.088
132 


87563.089
133 


87563.090
134 


87563.091
135 


87563.092
136 


87563.093
137 


87563.094
138 


87563.095
139 


87563.096
140 


87563.097
141 


87563.098
142 


87563.099
143 


87563.100
144 


87563.101
145 


87563.102
146 


87563.103
147 


87563.104
148 


87563.105
149 


87563.106
150 


87563.107
151 


87563.108
152 


87563.109
153 


87563.110
154 


87563.111
155 


87563.112
156 


87563.113
157 


87563.114
158 


87563.115
159 


87563.116
160 


87563.117
161 


87563.118
162 


87563.119
163 


87563.120
164 


87563.121
165 


87563.122
166 


87563.123
167 


87563.124
168 


87563.125
169 


87563.126
170 


87563.127
171 


87563.128
172 


87563.129
173 


87563.130
174 


87563.131
175 


87563.132
176 


87563.133
177 


87563.134
178 


87563.135
179 


87563.136
180 


87563.137
181 


87563.138
182 


87563.139
183 


87563.140
184 


87563.141
185 


87563.142
186 


87563.143
187 


87563.144
188 


87563.145
189 


87563.146
190 


87563.147
191 


87563.148