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Lack of alternate crops may see most growers sticking with peanuts

This may not be the easiest year for Southwest farmers to make cropping decisions, especially those with significant investments in peanut and cotton equipment or water reserves inadequate for corn.

“I've heard that farmers in the northern growing area of Texas have cut back on peanut acreage this year,” says Roger Neitsch, Gaines County peanut and cotton producer. “We all grew a lot of peanuts for cheap prices last year.”

Staying with peanuts

Prices aren't significantly better as farmers prepare to seed the 2007 crop, but Neitsch expects most growers in his area to stay with peanuts.

“I'll plant about the same acreage unless the price goes up,” he says. “But I'll grow them un-contracted. A lot can happen during the season to move the price.”

Most pre-plant contract offerings were around $415 a tonm and Neitsch says the potential that the price could improve next fall is better than locking in a low price early. ‘“We have to make some money out of it; break-even is not where we want to be. We have to try and make it work.”

Neighbor Shelby Elam expects to make few changes as well, but will venture out a bit with forage and cattle operations. They'll both plant cotton and peanuts. Neither is excited about cotton prices.

Few choices

“But we don't have a lot of choices,” Elam says.

Neitsch says, “Cotton is less expensive to grow than peanuts. Peanuts didn't look good early last year, but we survived. I may increase cotton acreage, since I've trimmed it a bit the last two or three years. I have some land that has not been in cotton for four or five years. I don't plan on planting grain sorghum.”

He typically plants wheat and can graze it, cut it for grain, cut it for hay, or use it as a cover crop for minimum till cotton or peanuts.

Elam plans “more hay and cattle.”

Neither anticipates wholesale changes in production programs.

“I'll sidedress nitrogen instead of applying it through the irrigation system,” Elam says. “We've already cut tillage ‘way back and double-crop cotton and peanuts with wheat. I'll graze the wheat and then plant in the stubble.”

Neitsch says, “I'll do more no-till instead of minimum till.”

Another option

Both say cutting hay offers another market option, since last summer's drought created a shortfall.

“The hay market is good,” Elam says. “The horse market is particularly promising — that's a huge market.”

He likes hay and forage production because of flexibility; he can make large bales for cattle or small, square bales for horse owners.

Neitsch says grain acreage in the Gaines County area may not increase as much as folks initially thought.

Gaines County Integrated Pest Management Specialist Clyde Crumley says, “Farmers will live with cotton and peanuts. We may have a little more grain sorghum, but peanut farmers who have their own equipment and adequate water will stay with peanuts and a good rotation. Some with marginal water and without a good rotation may have got out after last year or cut back on acreage.”

He says with limited sales options growers have had little incentive to book peanuts early. “With $415 contracts, not many have signed, and shellers seem to be waiting on the buyers. Energy costs are playing a role.”

Difficult decisions

Elam and Neitsch say fuel and fertilizer are up again this spring and that their suppliers are passing costs along to them, making acreage and production decisions even more difficult.

Available irrigation water may be a determining factor.

“We're looking at a diminishing groundwater resource,” Crumley says. “We're working with Shelby to quantify performance of varieties with limited moisture. Last year we saw some significant differences in cotton.” He says the ultimate goal is to identify varieties that perform best with limited moisture.

Neither Neitsch nor Elam will revert to conventional cotton varieties to save money. They agree that improved varieties helped push yields up the past few years.

The newer varieties with “technology are good investments,” Elam says. “Even on dryland or semi-irrigated acres, we don't plant conventional cotton varieties.”

They say success of the boll weevil eradication program has also added pounds to their cotton yields.

“We are not quite to the quarantine stage yet,” Crumley says, “but with a good year, we should be close to paying off our debt. And we're not using nearly as much pesticide as we used to. It has been a sound, economical program for farmers.”

“We've done a good job of cutting back on chemical use,” Neitsch says.

Crumley says pink bollworm infestation has become “a huge issue here and technology has made a big difference in control strategy. Bt cotton is death on pinkies. We've had some grant money to help monitor pink bollworm populations.”

He says some flares popped up last year. “I think they came from non-Bt cotton acres and were mostly in dryland fields.”

Neitsch says peanuts and cotton, with wheat in between or in the same year for a cover crop, make a good rotation.

“The best wheat I ever made was behind haygrazer that I kept for cover instead of cutting for hay. I shredded it and left it fallow all summer, then listed it and planted minimum-till wheat. I didn't fertilize the wheat, and it was the best I've seen.”

He rarely expects a yield advantage from a cover crop, but says reduced erosion from water and wind make the cover a good investment.

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