Despite price competition from corn and soybeans, U.S. growers appear to be increasing their peanut plantings this year, by an estimated 16 percent, according to USDA's 2008 planting intentions report.
U.S. peanut producers intend to plant 1.43 million acres of peanuts in 2008, up considerably from last year's crop. A higher price received for the 2007 crop, compared to the previous five years, is seen as the primary reason for the expected increase in planted acreage.
Southeast growers — Alabama, Florida, Georgia, Mississippi and South Carolina — intend to plant 1.04 million acres in 2008, compared with the 898,000 acres planted in 2007. Georgia, the largest peanut-producing state, expects to see an increase of 23 percent in planted acreage from the previous year.
Growers in the Southwest (New Mexico, Oklahoma and Texas) intend to plant 279,000 acres, up 28 percent from the previous year.
Plantings in the Virginia-North Carolina region are expected to total 108,000 acres, down 5 percent from 2007.
Whether or not this peanut acreage increase is realized is still up for debate. An increase in the price of peanut seed along with higher prices for some peanut chemicals could make other crops appear more competitive. Still, it's expected the crop this year will be larger than the one in 2007.
“According to informal conversations with the shellers, it looks as though we'll probably meet the expected acreage increase in Georgia this year,” says Lamb.
The first planting intentions report for this year has Georgia's acreage pegged at 650,000, an increase from the 530,000 planted in 2007.
“I think a 15 to 16 percent increase in acreage with average yields is about what we need to have a normal carryover going into next year,” says Lamb. “We did need that increase. The big question, of course, is if we'll get average yields this year. Hopefully, we'll get a little bit above average.”
Farmers, he adds, certainly will be spending more money planting and growing the 2008 peanut crop.
The higher peanut acreage this year can be attributed to several factors, says Lamb. “One is the higher contract prices available to growers. Shellers came out early with the contract prices they had, and farmers responded to that. But even more than that, it's the better rotation we have going into this season because of the reduced acres from last year. Farmers, I believe, have an improved situation going into this year because of the reduction in acres we've seen for the past couple of years. Better rotations are directly related to better yields,” says Lamb.
Going into the 2008 production year, peanut growers already should have a portion of their crop forward contracted. “Contract offers are competitive if you look at peanuts versus cotton, corn or soybeans. Contract offers are in line with those other crops, and growers already should have a portion of their crop covered. But, they probably should leave a small portion un-contracted and see what happens in the market. Even though we have an acreage increase this year, if we have a yield problem in any other region, prices could improve even more,” he says.