Peanut farmers will take a significant income hit if proposed changes in base acreage remain intact and become part of the next farm law.
Ted Higginbottom, President of Western Peanut Growers Association and a Gaines County, Texas peanut farmer, says the proposal from the Specialty Crops Subcommittee of the House Agriculture Committee “will badly hurt thousands of peanut farmers and landowners in all peanut growing regions.”
He says the proposal is a response to some growers’ request for a $20 per ton increase in the loan rate. But that increase comes at a cost.
“Now all farmers with base acreage will receive payments on only 74 percent of their base, rather than the 85 percent they are currently paid on. They will lose 25 percent of their payments.”
The increased loan rate, up from $355 per ton to $375 per ton is of no value to any farmer, he says, since the market price is already above $400 per ton. “Thus, farmers will be forced to give up real money, one fourth of their government payments, for no benefit.”
Higginbottom says the recommendation results from “the unfortunate (but) determined efforts of some peanut leadership to push for a $450 loan rate that is totally unrealistic. There was never enough money in the budget to pay for this, even if all the government payments to base holders had been wiped out,” he says. “Throughout this year, we have been told by Congress that any amendment that increased the cost of the peanut program would have to be offset by a cut in another area of the peanut program.”
He says most farmers were unaware of the ramifications of the increased loan rate. “We don’t believe farmers were ever informed of this budget reality. They were promised an increase in their loan without being told the stiff price they would have to pay. We can only hope that once farmers realize what has been done to them, they will demand this legislation be changed by the full agriculture committee.”
Farmers who had been growing peanuts for the four years prior to 2002 received a base acreage in the 2002 farm legislation. “The base did not go to the landlords, but to the growers. To deny growers this base now would be bad faith,” Higginbottom says. “We appreciate (the support of) those members of the Committee who spoke in favor of addressing the problems in this legislation when it is considered in the full House Agriculture Committee.”
Higginbottom urges peanut farmers and industry leaders to contact legislators to reverse the decision. “We need the help of grower members of the Alliance to change this legislation,” he says.
The legislation is scheduled to be marked up in the full House Agriculture committee June 25.