.jpg)
Posted on 08/09/2005 10:24:44 AM PDT by Hi Heels
U.S. Appears Headed for a Peanut Surplus By ELLIOTT MINOR, Associated Press Writer Tue Aug 9, 5:35 AM ET
ALBANY, Ga. - Peanuts in storage plus peanuts in the field.
Right now, the United States has too many peanuts and that, experts say, could be bad news for the peanut commodity program unless something is done to whittle down the piles.
"We're afraid if we cost the government a lot of money, we'll get less in the next farm bill," said Tyron Spearman, executive director of the National Peanut Buying Points Association.
Some 215,000 tons of peanuts are still unsold from the 2004 crop and agricultural officials predict growers will produce another 2.3 million tons this year, Spearman said.
Despite recent growth in peanut consumption, Americans use only about 1.6 million tons a year and another 300,000 to 400,000 tons are exported.
That leaves a surplus of about 485,000 tons.
Farmers won't lose because their government crop program guarantees them $355 per ton. The losers could be federal taxpayers who pay the difference between the guaranteed price and the actual market value of the peanuts.
Low peanut prices increase government costs, while higher prices reduce government costs.
Last year's 2.1 million ton crop peanut crop has already cost the government $320 million, said Spearman, who spoke Friday at the Georgia Peanut Producers Association's annual buying point meeting. The 416 buying points stretching from New Mexico to Virginia buy peanuts from the farmer and grade them before shipping them to shelling plants or storage warehouses.
Georgia Sen. Saxby Chambliss (news, bio, voting record), chairman of the Senate Agriculture Committee, addressed legislative issues and the outlook for the new farm bill, which will be approved by Congress in 2007.
Costly commodity programs tend to be singled out in Congress, but Chambliss said the 2002 Farm Bill, which created the new peanut program, is successful and the peanut program has been a bargain most years.
"There's always somebody who wants to take a shot at the peanut program," said Chambliss, who challenged the industry to find new uses of peanuts.
Peanut acreage has increased after the elimination of the old Depression-era peanut program in 2002. That opened the door for peanut farming in new areas.
This year, more farmers opted to grow peanuts because it seemed to have the best economic potential when compared with cotton, corn and soybeans, Spearman said. As a result, peanut acreage increased 25 percent in Georgia and 15 percent nationwide.
Growers have been grumbling for several years that the U.S. Department of Agriculture's "posted price," the price U.S. peanuts can be sold on the world market, is too high and is pricing American peanuts out of the market. The current posted price is $337 per ton.
Stanley Fletcher, a University of Georgia agricultural economist who specializes in peanuts, said USDA officials could increase demand for American peanuts by lowering the posted price, but it would increase government costs.
"If we don't move the prices, we're going to have a lot sitting there," he said in a phone interview Thursday. "Prices have to move down to move them into the marketplace."
Spearman said U.S. shelled peanuts are currently selling for $850 per metric ton in Europe, compared with $695 per ton for peanuts from Argentina and $725 per ton for peanuts from China.
"Everybody is looking for an answer, but no one knows what the USDA is going to do," Spearman said.
Chambliss, noting that he'd been given a golf shirt made from corn the day before in Minnesota, urged the industry to "get creative" and increase peanut demand.
Then, reflecting on potential uses of peanuts, he said, "I don't know if we can make golf shirts out of it."
Blame the airlines for switching to pretzels. ;o)
Never mind all that. When will I see the price of my favorite peanut butter come down? :)
Not Bush's fault........this one falls on Carter!
Not shocking news really. The U.S. has always been full of lefty "GOOBERS".
May I have a few pounds, please...
EAT A SNICKERS FOR HEAVENS SAKE!!!!!!!!
Yeah, one Carter too many........
"When will I see the price of my favorite peanut butter come down? :)"
Never happen, the government's approach is to destroy the excess product rather than lower the price and get more customers.
I was going to say: "Insert Jimmah Caa Tah joke here"
Well it didn't work for buggy whips but I guess it works for peanuts. I bet Jimmy Carter gets some of my money.
"Oh, for the invention of the Goober Combustion Engine..."
We already have it; it's called a diesel. Make all them excess goobers into biodiesel?
Peanut oil can be refined.
Refined oil can be put into cars.
I'lll have the honey-roasted unsalted 94-octane, please.
I enjoy my share of Planters lightly salted.
I bet peanut oil would run one of those diesels.
Actually, the recent attention to "peanut allergies" is likely to blame... Our county school district will not allow any peanut products in to classrooms starting in the '05-'06... Peanuts are really starting to scare people for some reason...
If only there was a jelly surplus. *sigh*
I predict 20% price INCREASES.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.