News SPRING IN STEP: Uncertain Times Leave Farmers Wondering, ‘What To Plant?’

SPRING IN STEP: Uncertain Times Leave Farmers Wondering, ‘What To Plant?’

SPRING IN STEP: Uncertain Times Leave Farmers Wondering, ‘What To Plant?’
April 23, 2009 |

Ask Stanley Usery Jr., what he’s most optimistic about this spring planting season, and there’s a long pause before he answers: “The chicken business.”With the stock markets in disarray, the economy tanking, an uncertain political climate and record-high input costs, he’s only half joking. Nine 400-foot broiler houses that produce about six million pounds of chicken are easily top priority at the Usery family’s Limestone County farm.Fact is, 2009 could shape up as a year when farmers faced more uncertainty than they have in decades. That much was obvious from the USDA’s Prospective Plantings Report that projected farmers would play it “safe” by planting soybeans, a crop known for low input costs.Oh, there were indications of what might happen. Even before the report was issued March 31, it appeared corn and soybeans were running neck-to-neck, wheat was gaining ground and cotton was losing it. Peanuts, on the other hand, were still reeling from the salmonella scare at a Blakely, Ga., processing plant, and were a pretty safe bet to lose acreage.When the official report did come, it showed soybean acreage in Alabama would rise by 11 percent to 400,000 acres, 40,000 more than 2008. Fertilizer costs were expected to cause a slight, 1 percent decrease in corn acreage nationally, but in Alabama, would remain unchanged at 260,000 acres. The Prospective Plantings Report’s wheat forecast was a surprise — down by 4 percent statewide to 230,000 acres, but there were no surprises for the peanut industry, which will see the largest loss of all Alabama crops — down 25,000 acres (13 percent) to 170,000. Even so, that’s less than half of a 27 percent decline nationally to 1.12 million acres. The state’s hay and oat crops are expected to remain unchanged at 900,000 and 50,000 acres respectively. But another state specialty — the sweet potato — is projected to increase 4 percent to 2,700 acres.But throw in the undulations (more downs than ups) of the stock exchange, unpredictable weather and the globalization of agriculture, and even the best forecast gets murky. Yet, one thing is fairly certain — farm income will likely decline in ’09.That’s the opinion of the Food and Agricultural Policy Research Institute (FAPRI) which sent its own projections to Congress the first week in March. Patrick Westhoff, co-director of FAPRI, told the Farm Press that farmers should expect a “significant drop in net farm income this year.”
“The large run-up in prices last year caused a very high level of receipts for the crop and livestock sectors in the country,” Westhoff was quoted as saying. “But that was accompanied by very high costs of production, as well. The costs for fuel, fertilizer and other inputs also increased.”That’s hardly news to those in the field. In mid-March, farmers and retailers were still locked in a standoff over fertilizer costs, further delaying planting decisions for many torn between pricey corn, low-cost beans or risky cotton. Of course, for some caught in this credit crisis, the bank would make the decision for them.”This is probably one of the most indecisive years that we’ve ever had as far as being prepared on what to plant,” says Steve Dunn, secretary-treasurer of the Alabama Farmers Federation and president of the Conecuh County Farmers Federation. “Usually, by the first of the year, everybody knows what they’re going to plant, but this year that decision has been harder than I’ve ever seen it.””What do I plant? That’s the question. Right now, nobody knows,” Usery Jr., said in mid-March. “Some say corn acres will be down 5.8 million acres, others say it’ll be down 500,000 acres — that’s a big difference! Take out a bushel or two yield one way or another, and that’s a HUGE difference in what you may or may not have.””It’s just like the wheat market,” said Stanley Usery Sr., president of the Limestone County Farmers Federation. “Last year, they said we couldn’t produce enough wheat. This year, we’ve got wheat everywhere. In one year’s time, you can have a big deficit and now it’s oversupply. (Forecasters) can say all they want right now, but what’s going to be really interesting to watch is the market at the end of May and first of June. That’s when they can really start sorting out some real data and see what’s really going to happen.”Jerry Byrd, president of the Dale County Farmers Federation, says potash prices are forcing him to cut back on cotton acreage in favor of corn. “Cotton prices are at the bottom, and it’s like buying gold to buy potash,” he said. “We usually plant between 700 and 800 acres of cotton, but we’re going to put that in corn this year.”
Most of that corn, Byrd said, will be under irrigation, thanks to the addition of five center pivots last year and the rental of some more irrigated land. Almost 200 acres that were once cotton and dryland corn will be converted to grain sorghum for a buyer he found in Florida. Sorghum acreage was expected to decline 16 percent nationally over last year.Surprisingly, one thing he’s not changing is his peanut acreage. Although many long-time producers are cutting back due to a large surplus and the absence of a contract price, Byrd says he’ll still plant about the same as always — 300-400 acres. “There’s been some talk about cutting back pretty drastically on peanuts,” he said, “but I don’t know how it’ll shake out.”Randy Griggs, executive director of the Alabama Peanut Producers, expected to see about 25 percent fewer acres in peanuts this year than last year when farmers saw their largest average yield in history.”Our normal carryout should be about 500,000 tons as an industry, and we currently have about a million tons of carryout — about twice what we’d normally have,” said Griggs. “We’d probably be a little bit less had not the situation in Blakely, Ga., occurred. But, short term, I don’t think that will impact growers; long term, it could make the surplus last longer than we thought.”Alabama’s 350,000 acres of soybeans last year averaged 35 bushels per acre, but good rainfall in north Alabama pushed that up to 60 to 70 bushels for some farmers — enough to prompt some farmers into planting soybeans for the first time ever, but maybe not enough for those burned by the big soybean bust of the 1970s.Corn projections, however, vary widely, largely because it is inextricably linked to oil and, in turn, livestock feed prices. Too, the yields are more risky unless irrigation is available, and the input costs run higher because of the fertilizer.That’s not a problem for the Usery father-and-son team in Limestone County, however. The litter from the Userys’ poultry houses serves as their hedge against high fertilizer prices. They’ll plant 350 acres of corn and as many acres in beans. They’ll come back behind the beans with wheat, but they’ll skip cotton for the first time in almost a decade.”The chicken business has helped our farm operation grow because of the chicken business complementing the row crop as a source of cheap, abundant fertilizer,” said Stan Jr. “I know there’s a dip in prices right now, but it’s not like we haven’t been through this before. But we’re optimistic anyway; that’s why we’re in farming. I’m not going to sit here and say, ‘Oh, I feel so bad.’ I love what I do. We’re not getting rich, but we’re making a living.”

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