•Producers with peanut base get $9.20 per ton payment.
•Obama’s proposed cuts and many other legislative items should be of concern to producers.
•Sen. Lincoln increases nutrition spending but with funds from EQIP.
•NPB celebrates 10 years with event in Washington, D.C.
•GPC says UGA cuts unfairly target agriculture school and programs.
•Donations to PB For Haiti continued through the end of March.
Counter-Cyclical Payment Made
USDA issued in March approximately $121 million in partial 2009-crop counter-cyclical payments to producers with upland cotton and peanut base acres enrolled in USDA’s direct and counter-cyclical payment program.
For all commodities other than upland cotton and peanuts, the market price projections exceed levels that would trigger these payments. Thus, no partial 2009-crop counter-cyclical payments will be issued for wheat, barley, oats, long grain rice, short and medium grain rice, pulse crops, corn, grain sorghum, soybeans and other oilseeds.
The partial 2009-crop peanut counter-cyclical payment rate is $9.20 per ton, equal to 40 percent of the difference between the target price of $495 per ton and an effective price of $472 per ton. The effective price is equal to the projected average market price of $436 per ton plus the direct payment rate of $36 per ton.
The partial 2009-crop upland cotton counter-cyclical payment rate is 1.03 cents per pound, equal to 40 percent of the difference between the target price of 71.25 cents per pound and an effective price of 68.67 cents per pound. The effective price is equal to the projected average market price of 62 cents per pound plus the direct payment of 6.67 cents per pound.
The 2008 Farm Bill provides that one partial counter-cyclical payment, in an amount up to 40 percent of the projected counter-cyclical rate, may be issued after 180 days of the marketing year. The projected counter-cyclical payment is the amount by which the target price, specified by the 2008 Farm Bill, exceeds its effective price.
The effective price equals the direct payment rate plus the higher of either the projected national average market price received by producers during the marketing year or the national average loan rate for the commodity.
For each commodity, the counter-cyclical payment for each crop year equals 85 percent of the farm’s base acreage multiplied by the farm’s counter-cyclical payment yield multiplied by the counter-cyclical payment rate.
Concern About Farm Bill Changes
Bob Redding, of the Redding Firm in Washington, D.C., recently outlined a number of concerns producers should have, beginning with President Obama’s proposed cuts in agriculture. Those cuts include the elimination of peanut and cotton storage payments, a more restrictive payment limitation structure and additional cuts for the Market Access Program (MAP).
Redding said that the cuts for storage payments and proposed changes in the payment limitations are being offered by the administration despite the agreements made in the 2008 Farm Bill. Although agriculture exports have been a bright spot historically for the American economy, the administration has proposed cutting the MAP program, which has been one of the most effective federal agricultural programs.
Redding said that Senate Agriculture Committee Chairman Blanche Lincoln (D-AR) has made child nutrition programs a priority. The potential impact on peanut butter usage can be demonstrated in the Fiscal Year 2010 spending projections: the school breakfast program is approximately $3 billion and school lunch and afterschool snack programs approach $10 billion.
Redding also said that the House and Senate committees have completed work on food safety legislation. The Senate bill contains an allergy education program for schools that will be conducted by the U.S. Department of Health and Human Services (HHS). The University of Georgia’s College of Agriculture and Environmental Sciences has proposed that this be done through the Extension service.
He added that disaster legislation for 2009 failed to attach to Fiscal Year 2010 appropriations legislation and has been removed from the Senate’s jobs legislation. Key farm state members are still pushing for this legislation.
Redding said that the House Agriculture Committee will begin new Farm Bill hearings in the spring, first in Washington, D.C., then field hearings around the country. The Senate Agriculture Committee has suggested delaying any hearings until some of the issues in Washington, D.C., are settled.
NASS 2009 Price Comparison
USDA’s National Agricultural Statistics Service says the price of peanuts in 2009 averaged 23 cents per pound, the same as 2008.
The value of the 2009 peanut crop at farm-gate level is $835,172,000, a 30 percent decrease from 2008. The highest average price was paid in New Mexico followed by North Carolina, and the lowest average price was paid in Mississippi followed by Oklahoma.
Lincoln Ups Nutrition Program Funds
U.S. Senator Blanche Lincoln, (D-AR) chairman of the Senate Committee on Agriculture, Nutrition and Forestry recently unveiled the Healthy, Hunger-Free Kids Act of 2010, a bipartisan, fiscally responsible bill making the largest investment in federal child nutrition programs to date.
Lincoln’s bill provides $4.5 billion in new child nutrition program funding over 10 years, a significant increase over previous efforts. The highest previous increase was $500 million over 10 years.
“We are poised for a truly historic moment in the Senate Agriculture Committee today with the unveiling of a bill that makes the largest investment in our child nutrition programs to date,” said Lincoln. “This proposal is a monumental step forward as we work to end childhood hunger and address the epidemic of childhood obesity in the United States. It invests roughly $4.5 billion in new funding in child nutrition programs over the next 10 years – more new money than we have provided for child nutrition programs since their inception.
“This legislation will also mark the first time since the inception of the National School Lunch Program that Congress has dedicated this level of resources to increasing the program’s reimbursement rate.
“It also invests heavily in new initiatives designed to automatically enroll more eligible low-income children with our National School Lunch and School Breakfast Programs and includes a major expansion of afterschool feeding programs,” said Lincoln.
The legislation aims to ensure that all children eligible for nutrition programs are actually participating, improve the quality of meal benefits and modernize and improve the integrity of the programs.
Sen. Lincoln also says the legislation is fully paid for.
However, conservation promotion groups have expressed disappointment that the Senator’s bill will be paid for by cuts to conservation program increases made in the 2008 Farm Bill.
Paid For With Reductions To EQIP
A statement issued by the Environmental Defense Fund (EDF) said, “Senate Agriculture Committee Chairwoman Blanche Lincoln yesterday introduced a child nutrition bill that would cut more than $2 billion dollars from the largest of USDA’s working lands conservation programs, the Environmental Quality Incentives Program (EQIP), according to a leading conservation group.
“As a result of EQIP’s nationwide popularity, Congress increased funding for EQIP in the 2008 Farm Bill by $3.4 billion over 10 years.”
The EDF says Sen. Lincoln’s proposed EQIP cuts would wipe out more than two-thirds of that increase.
“The EQIP program, which is greatly supported by environmental groups, allows agricultural producers to share with USDA the cost of implementing practices on working agricultural and forest lands that deliver a broad array of environmental benefits, including improved water quality, soil quality, air quality, forest health and wildlife habitat.”
The statement went on to say, “We are disappointed to see Senator Lincoln propose cutting conservation funding so soon after taking over the chairmanship of the Agriculture Committee. We hope she and other members of the committee will consider alternative ways to pay for child nutrition legislation as this bill moves forward.”
The federal child nutrition programs include the National School Lunch Program, School Breakfast Program, Special Supplemental Program for Women, Infants and Children (WIC) and the Child and Adult Care Food Program.
GPC Upset Over Proposed UGA Cuts
The Georgia Peanut Commission issued a statement in which they said that the peanut growers of Georgia were disappointed in the proposed budget cuts at the University of Georgia.
Armond Morris, GPC chairman, said, “For the university to suggest that the College of Agriculture and Environmental Sciences bear the brunt, disproportionately, of cuts clearly indicates that the university has lost focus of the mission of its land grant charter.”
The board said that it seems painfully obvious the cuts were targeted toward Georgia’s leading industry, agriculture.
The GPC statement said that agricultural research and Extension programs have helped to make agriculture strong in this state, and they have asked the governor and the legislature to work with the agriculture community to assure the continuation of these and all critical programs impacting the future and profitability of Georgia agriculture.
The Georgia General Assembly has not issued a final budget for FY 2010.
NPB Celebrates 10 Years
The National Peanut Board recently celebrated 10 years with a sponsored event at the famous Eastern Market in Washington, D.C. More than 150 guests, including members of Congress, USDA Deputy Undersecretary Ann Wright and other personnel from USDA, industry members, producers and culinary experts attended the event.
Famed D.C.-area chefs, R.J. Cooper, Brian Voltaggio and Katsuya Fukushima created outstanding peanut dishes for the luncheon, using in their ingredients: peanuts, peanut butter, peanut oil and peanut flour. All of the chefs shared their professional and personal appreciation for peanuts during the program.
Also part of the event, more than 100 different retail peanut or peanut butter products were showcased, many of which NPB assisted in bringing to market over the years.
NPB Chairman, Jeffrey Pope, spoke about the significance of the 10th anniversary. “Through it all, the board has found a common language and united under the common purpose of working on behalf of all USA peanut farmers in the areas of research and promotion to support and expand existing markets, develop new markets and facilitate the economical production of high-quality USA peanuts for consumers worldwide.”
NPB premiered its Energizing for Great Causes Award and presented it to the nonprofit organization Brainfood, which utilizes culinary-related activities to promote active learning, self-reliance and healthy living to empower youth.
NPB President and Managing Director Marie Fenn, in presenting the award, said that it honors individuals and organizations that have found the energy to make a difference and used that energy to contribute to a higher quality of life for those you support.
In the last referendum, peanut producers overwhelmingly voted to continue the national check-off program that generates about $6.5 million annually to promote USA peanuts.
APC Helping To Protect The Industry
Bob Parker, Chairman of the American Peanut Council (APC) recently told buying point managers that the job of the APC is to serve as a spokesperson for the industry and serve in issues management. The group has a crisis management team and a plan ready should an industry crisis arise as it did last year.
An APC task force is working to increase government purchases of peanut butter. The APC serves as a forum for issues such as mapping the peanut genome and biotechnologies to improve yield and other characteristics, is approved by the Foreign Agricultural Service to increase peanut exports and assists in Peanut Foundation operations.
More Donations To PB For Haiti
The Georgia Farm Bureau and county offices joined to help the victims of the earthquake in Haiti by donating more than $16,000, which purchased 17,777 pounds of peanut butter, to the Peanut Butter for Haiti project.
Georgia Farm Bureau contributed $5,090 of the total donation and asked its 158 county offices to join it in supporting the cause. The county Farm Bureau offices responded by donating a total of $10,910.
In Texas, students at Dublin Middle School, which is located in central Texas, held a small change fundraiser to benefit the Peanut Butter For Haiti project.
The school’s sixth, seventh and the eighth grade classes held a contest to see who could raise the most money. The three classes combined raised $863 for peanut butter. A local peanut producer matched the donation made by the winning class.
With the matching check of $357 and the $863 raised by the Dublin Middle School, a total of $1,220 was raised for the purchase of peanut butter to ship to the Haiti earthquake victims.
After hearing about the industry’s efforts, Jackie Warren, co-owner of Caprock Peanut Co., in the West Texas town of Lamesa, and Sharon Cox, co-owner of The Fertilizer Place, donated and challenged their community to do the same.
Cox collected a total of $9,350, of which $3,500 was donated in just five hours the day after she learned of the Early County 2055’s fundraiser.
Golden Peanut Company, Birdsong Peanuts (who both have locations in Texas), the Texas Peanut Producers Board, and many other Texas agriculture businesses and residents have also stepped forward with donations.
Donations to the Peanut Butter for Haiti project through Early County 2055 in Blakely, Ga., were accepted through the end of March.