The remains of a cow lay near a watering point in a pasture July 28, 2011 near Tulia, Texas.
The remains of a cow lay near a watering point in a pasture July 28, 2011 near Tulia, Texas. - 

Jeremy Hobson: Well here in this country, one of the biggest natural disasters of the year still hasn't come to an end. That would be the drought in Texas, which has devastated the state's farmers.

But the fallout from that drought extends far beyond the borders of the Lone Star State. From the Marketplace Sustainability Desk, Eve Troeh reports on how the rest of the country could feel the Texas heat.


Eve Troeh: If you take the 500-mile drive from Austin to Amarillo, every other tree is dead, and every farmer's lake is bone-dry.

Jack Plunkett runs a market research firm in Houston.

Jack Plunkett: I think you really can't appreciate how bad this has been until you get out there and see it.

Ranchers have lost at least 600,000 cows so far. They slaughtered older cows when the drought hit. Now they've cut into breeding stock.

And Texas is so big, it's not like other states can just pick up the slack.

Plunkett: This business isn't going to move to Nebraska just because it's dry in Texas. It's just not going to work that way.

Plunkett says it'll take years for Texas grass to grow back enough to feed cattle. He expects steak prices to beef up by the end of 2012. And as for the other pillar of Texas agriculture:

Mike Stevens: The largest contiguous cotton patch in the entire world.

Cotton analyst Mike Stevens says half the farmers abandoned their crops last summer. Most got paid, thanks to crop insurance. And, frankly, the world hasn't missed Texas cotton.

Stevens: You had China, you had Pakistan, you had India and everyone else with bumper crops.

Such good crops that cotton prices sank. Texas farmers are now deciding whether to bother with cotton next year. The Texas state climatologist expects this drought to go into 2012, and higher risk for drought overall due to rising temperatures.

I'm Eve Troeh for Marketplace.

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Follow Eve Troeh at @evetroeh