Peanut Growers Adapt to a New Reality

10/12/2013 7:00 AM
By Linda McNatt Va./N.C. Correspondent

SUFFOLK, Va. — For generations, peanuts have reigned as the cream of the crops in southeast Virginia and northeast North Carolina.

In fact, this is the area where Italian immigrant Amadeo Obici settled to build Planters Peanuts. The company eventually became an empire in the world of nuts and snack foods.

And peanuts provided an easy living for farmers in the area until the 2002 Farm Bill wiped out a lucrative government subsidy program that paid special bonuses for growing the legumes.

It was like a contract with the federal government, authorizing raising peanuts on a certain number of acres. It lasted for nearly 70 years and might have lasted forever if not for the Farm Bill intervention.

Owners of the contracts were paid monetary settlements over a five-year period.

Between 1995 and 2012, peanut subsidies in the United States amounted to $3.6 billion. North Carolina ranked fourth with almost $327 million. Virginia was ranked right behind North Carolina with about $212 million.

Since then, things have changed for peanut farmers.

Peanuts are now sold on contract directly to shelling companies, which in turn sell the nuts to manufacturers of everything from peanut butter to candy bars. Prices offered in the early days after the end of the peanut program were far less than what the farmers received before 2002 — $400 a ton compared with $610 a ton.

The price has increased somewhat, but that hasn’t stopped many farmers from selling their expensive equipment and abandoning a crop they loved to grow.

“Peanuts have been an honored crop around here,” said Greensville County farmer William Poarch. “We still honor them.”

Poarch, 77, is one of those who sold out. He no longer grows peanuts, he said, but can’t resist eating them. It’s still his favorite snack food. On Saturday, Sept. 28, Poarch was Grand Marshal of the 51st annual Virginia Peanut Festival parade in Emporia, Va. Poarch was honored because he’s the oldest still-active farmer in the county who grew peanuts, a festival organizer said.

“Peanuts are good for you,” said Poarch.

Billy Bain of Dinwiddie County, has been growing peanuts for nearly a half century, and he’s not giving up. Bain planted 160 acres of peanuts on his 3,500-acre Double B Farms this year, and he’s about to start digging in a week or so, he said. He’s holding off because of months of dry weather in his area. The soil needs to have a certain amount of moisture before the peanuts can be dug successfully.

Peanut harvesters pull the plants from the soil and the peanuts, attached beneath the soil’s surface to the plant by long fibers called pegs, come out with them. Farmers then hope for a few days of dry weather when the vines can stay on top of the ground to dry.

“We had a good peanut yield last year,” said Bain. “I don’t know what it’s going to be this year. Peanuts are just not the card they used to be.”

In Suffolk, Va., just a few miles from the headquarters of Planters Peanuts, farmer Tommy Rountree has had a fairly idol summer. Rountree, who has been a state and national leader of peanut associations, didn’t grow peanuts this year.

“I’ll get over it,” he said, chuckling, “but I wouldn’t want the word to get around.”

Peanuts cause a little more pressure than the other crops he grows, like cotton, soybeans and corn, Rountree said. They have to be planted on time and they have to be harvested on time. If the weather is too cold during harvest, frost or freeze can damage the nuts that have already been dug, and the crop won’t be good for anything but oil or peanut butter. It will bring far lower prices.

“Spring before last, I looked around the farm and realized I didn’t have any land I could rotate for peanuts,” he said. “Some people have made out better since the buyout. It was hard when we first got started.”

But last year, Rountree said, he had one of the best peanut crops in his farming career. He got good contract prices from the shelling companies. That was until he realized this past spring that he couldn’t plant peanuts after peanuts.

Peanuts are a picky crop said Dell Cotton, executive director of the Virginia Peanut Growers Association.

“Peanuts deplete the nutrients in the soil,” he said. “They give back, too. But they’ve got to be planted in rotation, behind cotton or corn. Tommy didn’t not plant peanuts because he’s lost interest in peanuts. He did it so he could improve his rotation.”

Before the demise of the peanut program, most farmers were planting peanuts on a three-year rotation. Since the end of the program, most have moved to a four-year crop rotation, said Cotton.

The result has been a significant increase in peanut yields, from a state average of about 3,000 pounds an acre to about 4,000 pounds an acre. If the end of the peanut program has done anything, it has improved the quantity and quality of peanuts, Cotton said.

Farming is all in response to market efficiency, he said.

“That’s the name of the game,” he said. “Each year, farmers have to sit down with their whole acreage. They know they can’t plant peanuts in the same field in consecutive years.”

Before the end of the peanut program, farmers planted about 75,000 acres of peanuts. This year, only 16,000 acres were planted. The yield is forecast to be 4,100 pounds per acre, according to the Virginia Department of Agriculture and Consumer Services. Production is expected to total 65.6 million pounds.

But prices have remained unstable.

Peanut contract prices last year were $700 a ton, said Cotton. This year, it looks like the price offered will be around $500 a ton.

Rountree said he had one of his best years ever in peanuts last year. That’s likely why he decided to go into a peanut hiatus, Cotton said.

“They’ve got to take a break, and this was probably a good year to do that,” he said.

Meanwhile, on a sunny late September afternoon in Suffolk, farmer David Bosselman and his son and farming partner, Hunter, were in the fields stirring up ripples of dust and picking peanuts.

Driving twin John Deere peanut diggers, working their way from one end of the fields to the other, the men could smell the sandy, rich Virginia soil their crop had been planted in, and they could gaze down into the piles of peanuts mounting on top of the soil.

With 355 acres of peanuts planted this year, Bosselman is one of the city’s biggest peanut producers. He’s planted peanuts year after year, he said. His father planted them before him.

But he may not plant them next year. He needs to take a break, he said. The soil needs a rest.

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