No relief in sight for drought-stricken Texas. The current drought has ravaged crops and pastures, and is contributing to devastating wildfires in West Texas. Three-fourths of Texas is now baking in exceptional drought, the worst level, according to the U.S. Drought Monitor.

Texas Grain & Feed Association (TGFA) Members in the Panhandle are faced with having to choose if they want to water crops and if so, how much of the crop. Some have indicated that the excessive heat is causing irrigated water to evaporate before it hits the ground.

Association members in South and Central Texas have been blessed with rain, but the rain fell untimely, wreaking havoc on this year's cotton crop. Situations are dire and water is the culprit.

Three months ago, only 15% of the state was experiencing exceptional drought. One year ago, nearly 83% of the state was drought-free. October through June was the state's driest nine-month period on record, though the drought is still ranked No. 3 in state history, according to state climatologist John Nielsen-Gammon. If current conditions continue through August, the drought could surpass 1918 for second place; if they continue through September, it could approach the record-setter of 1956, he said. Official weather record-keeping began in 1895 in Texas.

Impact on Agriculture

The drought is hammering the Texas agricultural industry, says Travis Miller, a Texas A&M professor and drought spokesman for the Texas AgriLife Extension Service.

"It's hard to find any dryland crops alive from San Angelo to Oklahoma," he says. "For irrigated crops, a lot of farmers are abandoning half of their fields because it's evaporating faster than the wells can pump it out."

The drought is forcing cattle raisers to thin their herds. "There's no grass, no hay, and they are flat running out of water," Miller reports, noting that a San Angelo auction barn ran through 5,000 cows and 5,000 calves this week, three to four times its normal volume.

Ranchers are also being forced to haul in water, but that's a "losing game," Miller notes. By May 15, agricultural losses were estimated at $1.2 billion for livestock and $250 million for wheat.

Consumer Impact

Consumers eventually will see the cost of the drought passed on to them, although it's hard to say by how much since processing, marketing, transportation and other costs also play a big role in retail prices, Miller says.

The drought in cattle country could actually bring a short-term benefit to consumers. Beef prices have been running at near record highs, but with so many ranchers now forced to sell off their herds, the price of beef is expected to drop.

Already auction prices in Texas have fallen 15 cents from 80 to 65 cents/pound and could continue down through summer. But with the U.S. cattle population already at a 50-year low — lower prices won't last.

"We'll be certainly looking at higher beef prices in the future just simply because fewer cows, fewer calves less beef production, so there's going to be less beef in the market for consumers to buy," says Dr. David Anderson, an economist at Texas A&M University.

Analysts believe beef production will continue at or above last year in the near-term as we keep pushing cattle into feed yards as a result of the drought. But at some point beef production will decline and that decline will further lower per-capita consumption and drive consumers toward alternative protein sources like pork and poultry. As that scenario plays out it will become evident that this year’s unprecedented drought will affect our industry for years to come

Declining Groundwater

The ferocious Texas drought is clobbering crops, thinning out cattle herds, decimating wildlife, and drying up streams and reservoirs, but it's also causing problems deep underground, where the state's aquifers are dropping at a precipitous rate, experts say.

After nearly a year of scant rainfall, 100% of Texas is withering under abnormally dry conditions, according to the latest U.S. Drought Monitor, and 75% is in an exceptional drought — the worst level.