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Mississippi: Ag income drops 15 percent

Agricultural economists are forecasting increases in government payments and in the value of only one of Mississippi’s 2009 crops — hay.

Disastrous rainfall, acreage or production decreases, and some lower commodity prices contributed to a 19 percent value of production decline for an estimated commodity total of almost $5 billion. Government payments are predicted at about $500,000, bringing the state’s grand total to $5.5 billion, a 15 percent decline from 2008.

While rain’s impact on agronomic crops got most of the attention, other crops, such as poultry, forestry, livestock and catfish, also are expected to post value losses. Hay, Mississippi’s No. 7 crop, is predicted to increase in value by 11 percent to $143 million.

John Michael Riley, agricultural economist with the Mississippi State University Extension Service, said the 50 percent increase in government payments is more a reflection of how low they were in 2008 than how high they were in 2009.

“Commodity prices for the 2007-2008 marketing year were higher — above the target prices — and did not trigger extra payments,” he said. “2009 is more in line with the payments in the previous years, making 2008 more of an anomaly.”

Riley said the biggest crop value declines from 2008 are expected to be in grain sorghum (89 percent), wheat (80 percent), sweet potatoes (64 percent) and cotton (61 percent).

“For most of the agronomic crops, prices were stable or higher than in 2008. The problem was growers could not take advantage of those prices because of yield or quality losses,” Riley said. “Wheat, with an estimated value of $33 million, is an example of a crop with significantly fewer planted acres.”

Wheat acreage decreased to 180,000 acres from 520,000 the previous year. Other notable acreage declines included grain sorghum, which dropped from 85,000 to 13,000 acres; and cotton, which declined from 365,000 to 295,000 acres.

Extension grain crops specialist Erick Larson said higher nitrogen prices pushed farmers away from wheat in the fall of 2008. Then in April and May, which are the most critical times for wheat grain productivity, wet weather reduced the crop’s grain yield potential and hurt the grain quality at harvest. Average yields dropped to 50 bushels per acre in 2009, down from 62 bushels per acre the previous year.

“The spring was about as difficult as you could imagine for wheat,” Larson said.

Poultry remained Mississippi’s No. 1 agricultural commodity with an estimated $2.3 billion value, down 3 percent from 2008. Poultry has held the top spot since 1994 when it leaped into the billion-dollar club and surpassed forestry. 2009 marks the first year forestry is expected to drop below the $1 billion mark since 1992.

“Forestry’s dramatic drop occurred mainly because of the downturn in the housing market, and it translated into a decline in lumber production. There are a lot of landowners waiting for prices to improve, and they are not harvesting,” said James Henderson, Extension forestry specialist.

Soybeans remain in third place with an estimated $432 million value, despite an expected 37 percent decline in value. Corn was not far behind at $380 million, a 16 percent decline.

Larson said corn faced difficult conditions all year but did tolerate the wet harvest conditions better than most crops.

“Corn is a larger, more robust kernel with a waxy seed coat and a husk that covers the ear to provide some protection from the rain,” Larson said. “Most of the crop was harvested before Sept. 10, which was also before the rains became particularly recurrent. The later harvested corn crop had losses of up to 25 percent.”

Larson said he expects another drop in wheat acreage this winter because rains delayed fall plantings. He said some predictions of 100,000 to 150,000 acres might be optimistic.

“In 2010, corn acreage should stay about the same, but growers need to remember the importance of crop rotation. It’s not only beneficial by improving productivity, but rotating also diversifies risks and generally reduces pest issues, including insects, weeds and diseases, and the input expenses associated with these limitations,” he said.

“Growers should not look solely at the commodity market price when making their planting decisions but also include these other factors in their cropping budgets.”

Catfish, which ranked sixth among the state’s crops, decreased 12 percent in estimated value to about $182 million, reflecting a similar acreage decline.

Extension aquaculture professor Jimmy Avery said Mississippi had 84,000 acres of catfish ponds in 2008, but only 70,000 acres in 2009.

“Producers are retiring acreage because they have not been able to realize a profit due to increased foreign competition, high feed costs and a generally poor economy,” Avery said. “While prices were about the same as in recent years — around 77 cents per pound — feed costs remain 75 percent to 125 percent higher than 2007 prices. Producers cannot pass on those costs to consumers because of the availability of lower-priced foreign products.”

Finishing out the state’s top 10 agricultural commodities is rice, which landed the No. 5 spot with a value of $214 million, down 17 percent; and cattle/calves at $138 million, down 12 percent. Cotton dropped one position to No. 9 with a value of $98 million, and horticultural/other crops are close behind with a value of $93 million, down almost 6 percent.

Mississippi’s remaining crops also are expected to decline in value in 2009. Those estimates include hogs at $68 million, down 9 percent; milk at $36 million, down 41 percent; sweet potatoes at $25 million, down 64 percent; peanuts at $11 million, down 41 percent; and grain sorghum at $2 million, down 64 percent.

Bill Burdine, area agent based in Chickasaw County, Miss., said sweet potato growers started and ended the year battling wet conditions.

“Growers planted about 2,000 fewer acres because of the rains at planting time, but the situation improved and we were looking at above-average yield and quality as harvest approached. We were about 24 percent harvested when the rains hit, and very little was harvested after that,” Burdine said.

“I predict that Mississippi will lose 10 to 15 sweet potato growers because of the 2009 disaster and the tightening of farm credit,” he said.

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