For some Virginia and North Carolina growers losing over 1,000 pounds per acre on peanuts contracted for less than $500 per ton is likely to be the breaking point for future production. 

There will always be a demand for the high quality, large kernel Virginia-type peanuts grown in North Carolina and Virginia. Without a consistent price structure that includes at least $500 per ton, more and more growers are likely to turn to other crops.

As recently as 1998, North Carolina produced up to 10 percent of the country’s peanuts. Now, acreage has dropped well below 100,000 acres. Even more dramatic cuts in acreage have taken place in Virginia.

Peanuts are an important crop, contributing more than $4 billion to the country’s economy each year, according to a USDA analysis. 

North Carolina and Virginia are among the top five states in the country in terms of amount of agricultural land lost each year. The sandier coastal soils of both states are ideal for peanut production, but have been prime targets for residential and resort developers.

If these states are to return to more traditional peanut acreage, it will likely have to come from non-traditional peanut areas and involve a new breed of peanut farmers — not to mention coming on fewer acres. 

In 2009, Virginia listed 175 peanut growers and had 12,000 acres planted, producing 43.8 million pounds. Prices at $500-$525 per ton created an interest among peanut growers in 2009. Subsequently, acreage went up slightly in 2010, even though prices stabilized at about $500 per ton.

The hope was that another good year, building on the 3,650 pounds per acre in 2009, would lead even more Virginia growers to get back into production. Instead, they got a near disaster, as growers pushed hard to harvest 2,000 pounds per acre.

In North Carolina, which for many years had the second or third largest peanut acreage in the country, 1,500 farmers were listed as peanut growers. Acreage was down to 66,000 acres, which is roughly the acreage expected in South Carolina in the next few years. 

As recently as a decade ago, South Carolina had virtually no peanut acreage. Through outstanding leadership, South Carolina growers have put together successively good seasons and optimism is high the industry will continue to grow in the Palmetto state.

Though a majority of South Carolina growers got into the peanut business in the mid-2000s, a result of changes in the peanut program, the state does have a long history of peanut production. This past August, the city of Pelion celebrated its 29th annual Peanut Party and area growers like father and son team Delano and Ricky Kneese have been winning yield contests nearly as long.

Average yields in South Carolina will likely top 3,200 pounds per acre, putting this crop a little ahead of the 2009 crop, but not near the record crop of 2008. The outlook for peanut production in South Carolina is good. If the South Carolina Peanut Board is able to attract a sheller or shellers to the state, the outlook for peanut production looks even better.

As growers move into the planning season for the 2011 crop, many are likely to be hard-pressed to include peanuts. Uncertainty over price in the past few years and remembering devastating losses from last year’s crop will simply take some growers out of the game — at least for the 2011 production year.