Tuesday, June 16, 2009

Budget Discussions

Budget discussions with my board have confirmed a lot of what I thought. Much of the 09 crop is either in trouble or non-existent.

The peanut industry is in for a real roller coaster ride. Acres are likely down more than the intentions suggested and the condition of the crop which is planted has a lot of problems. Drowned out low spots, skippy stands, and very late.

If you want to buy peanuts cheap in the Fall you better book now. We have a lot of potential to be hammered with TSWV in many areas. Also, the earliest planted peanuts started out with some weak seedlings and the roots stayed shallow for a while with all the rain.

Another complicating factor for the future is the increase in soybean acreage. The other day I was riding by a field on a country road and thought it was twin row peanuts in wheat until I was told different. The farmer told me he is doing soybeans that way and he is getting a yield response and his cost on soybeans is a lot less.

For peanuts in terms of rotation a Soybean is a peanut. So we cannot push acres up significantly in some areas because we need our other two rotation crop years at the least.

We are a long way from harvest and no crystal ball is perfect but I will say this year is starting out really in a bad place and it will take a miracle to come back totally from today's situation.

I guess USDA was right to hold the price high and they will look really smart at the end of the day if we have a disaster. They just have to hold them until Fall to capitalize on the disaster if it carries forward.

Oh well, prices should be a lot better next year at planting time.

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