ROBERT SIEGEL, HOST:
Even though a huge section of the country has been hit by drought, there is some good news. A lot of what we eat will not get more expensive. That includes most fruits and vegetables we would find in a grocery store. They are grown in irrigated fields, but as we just heard, we are likely to see the drought's impact in the meat, dairy and egg section.
More on that from NPR's Dan Charles.
DAN CHARLES, BYLINE: The crops that are getting hammered these days are the ones we feed to animals. Across the Western Plains, it's the grasslands, where cattle graze. In Illinois or Indiana, it's the soybeans and above all, it's the corn. David Hardin steps into a field of sad-looking corn plants on his farm near Danville, Indiana, and pulls off one ear. This one looks like baby corn, it's so tiny. There are no real kernels on this cob.
DAVID HARDIN: This looks like one of those ornamental ears that you might see on a fancy salad.
CHARLES: Still, for the most part, it's not the farmers who just grown corn and soybeans who are most worried right now. About three-quarters of them bought government-subsidized crop insurance and that will cover much of their loss this year. Some of those farmers, in fact, will earn more money this year than they would have had there been no drought.
But there's no such insurance for the farmers who need that corn to feed their animals. David Hardin and his father, John, for instance. They raise pigs, thousands of them. And for the first time that David Hardin can remember, their own farm won't grow enough to feed those pigs.
HARDIN: We've started to go out and have to buy corn on the open market at the market price.
CHARLES: Last week, they paid $8.30 a bushel, twice what corn cost two years ago. It may go still higher. When corn is that expensive, you're almost guaranteed to lose money feeding it to pigs. It costs more to feed the animals than you'll ever get paid for their meat. The same goes for chickens or cattle. If a farm was a factory, you'd just shut it down for a while, and start up again when prices were better.
But you can't just flip a switch with animals. In one barn on the Hardin's farm, there are three-week-old piglets swarming over their mothers.
HARDIN: Wednesday, this week, we'll be weaning them from their mothers and taking the piglets back to one of our nurseries.
CHARLES: Now, these are the piglets that are going to be consuming corn that's worth more than their meat is worth.
HARDIN: That's right, but the animals are on the ground, as we say.
CHARLES: And we just have to get them up to market weight as efficiently as we can, he says. And they have to keep the sows, too, at least some of them. If you want to have those mother pigs popping out piglets, say, 18 months from now when raising pigs might be profitable again, you have to keep feeding them now. John Hardin says the goal is just ride out the storm.
JOHN HARDIN: There is no doubt that for the next several months we're going to be in a position of loss to be managed around.
CHARLES: A lot of that management involves cutting down the number of animals that they have to feed. Hogs, dairy cows, beef cattle and chickens all are getting slaughtered in greater than normal numbers right now. Herds are shrinking. Some farmers are getting out of the business entirely. That's actually increasing the amount of meat for sale right now. Down the road, though, certainly by next year, there will be less pork, beef and chicken for sale.
That will drive up prices for meat in the supermarket.
CHRISTOPHER HURT: So in the end, consumers will pay.
CHARLES: Christopher Hurt is an agricultural economist at Purdue University.
HURT: But the problem for the livestock industry is, for the next year, even year and a half, there can be some very large losses till they can get to the better returns that we think will come in the second half of 2013 and on into 2014.
CHARLES: They'll really be able to cash in if there's normal rain and a better corn harvest next year so feed prices drop. Still, that's if there's rain. And the uncertainty haunts Mark Legan, a farmer in Coatesville, Indiana, with a herd of 3,000 sows. He says, I think we're going to survive this, but I've never seen anything like it.
MARK LEGAN: It's really uncharted waters for me, since I've been farming. And it, you know, really starts to play on your mind, too. My wife wants to know what's wrong with me at the end of the day when I come in.
CHARLES: And it's not just the financial situation, he says. It's hard just watching the crops wither in the fields. Dan Charles, NPR News.
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