What challenge did american farmers face in the late 1920s?
a. a drought
b. a seed shortage
c. a lower demand for crops
d. an insect plague

I would go with Drought, because if a big farm is supposed to be watered, there should be a lot of water to do that. 
and if that farmer does not have a lot of it, he is a bad farmer.
He needs water.
But he does not have it, that is called a drought.
Hope that this helps you! =)