Wheat and peanut acreage is expected to increase by about 20 percent in North Carolina’s 2012 crop season and cotton is projected to be the big loser, with projected plantings down to 700,000 acres this season.

Peanut acreage has been on a steady downward trend over the past decade or so, but high prices and concerns over the volatility of cotton prices is apparently encouraging farmers to increase peanut acreage to fill the gap in the loss of cotton acreage.

The cotton industry is still reeling from the giddy prices of $2 a pound and higher just a couple of years back. As the industry struggles to regain loss of market share, based on the historic high prices, the price of 2012 cotton has some built-in instability that is encouraging North Carolina growers to cut back on cotton acreage.

North Carolina is a leader in swine and poultry production, and the state struggles to produce enough grain to feed its booming livestock industry. Like other Southeastern states, North Carolina is still listed as a grain-deficit state, despite big increases in grain crop production over the past few years.

In 2012 North Carolina growers are expected to increase production of soybeans, wheat and corn — all major components of feeding rations for the state’s livestock industry.

According the recently released planting intention survey by the North Carolina Department of Agriculture and Industry, corn acreage is expected to increase by about three percent to 900,000 acres, soybeans by about 4 percent to 1.43 million acres, and wheat by about 19 percent and as much as 150,000 acres more than the 2011 crop.

Peanuts are expected to have the single largest acreage increase in North Carolina this year, and the Tar Heel state isn’t alone in peanut increases for 2012.

In South Carolina, growers are projected to produce nearly 95,000 acres of peanuts, and Virginia estimates of acreage increase range from 10-15 percent.

Peanut contracts in the Virginia-Carolina region are ranging from $600 to $750 per ton and growers appear to be taking advantage of the price increase.

In North Carolina projections are for about 100,000 acres of peanuts in 2012, a jump of 22 percent over the 2011 crop.

Corn was rotation choice

Corn was the long-time rotation crop of choice for peanuts, before cotton acreage jumped in the Southeast over the past decade or so. Now, much of the irrigated land that once went to peanuts is planted to corn because of the consistent high yields produced under irrigation and the ongoing high prices being offered for the crop.

The increase in peanut acreage isn’t likely to come on the most productive land, leading some to speculate that higher acreage may not correlate to a corresponding increase in total peanut production for 2012.

Acreage increases in North Carolina appear to be tracking with projected acreage increases across the country.

The demand for grain as an export crop and the stability of prices projected well into 2013 appear to be driving planting intentions in the Southeast and across the country.

Nationwide corn production is expected to increase from about 92 million acres to nearly 96 million acres.

Soybean production is expected to decline nationally by about a million acres, down to 74 million acres.

Wheat production nationwide is expected to jump from 54.5 million acres to near 56 million acres for the 2012-2013 crop.

North Carolina and Georgia are the leading agricultural production states in the Southeast and trends in those two states tend to mirror what happens in the rest of the region. If that trend continues expect the percentage of total crop to change significantly from 2011 to 2012.

In North Carolina, in 2011 soybeans made up 41 percent of the state’s total planted row crop acreage. Corn was second with 26 percent and cotton a close third with 24 percent. Peanuts comprised 2 percent of the total acreage as did sweet potatoes, while tobacco had 5 percent.

In 2012, soybeans will up its leading acreage to 43 percent and corn will increase to 27 percent. Cotton will lose 3 percent, down to 21 percent of the state’s spring-planted row crop acreage. Peanuts will gain one percent, sweet potatoes will remain the same and tobacco will lose one percent.

Nationwide, Steve Maliszewski, with the National Agricultural Statistics Service in Washington D.C. says cotton acreage in the U.S. is expected to be down by about 11 percent.

Of the larger acreage producers in the Southeast, North Carolina will have the biggest percentage drop, though Georgia is expected to drop from 1.6 million acres to 1.4 million acres in 2012.

South Carolina and Virginia are both expecting a 10 percent or so reduction in acreage in 2012, and Alabama and Florida will remain close to 2011 acreage levels.

What happens over the next few weeks with weather and markets will likely cause some significant shifts in final acreage.