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Agriculture marked by volatility

Mississippi farmers held on tight in 2008 as agriculture indicators fluctuated as wildly as gasoline prices.

The year began with high commodity prices and ended with interesting trends geared toward 2009 growth.

“This has been a significant year in agriculture for Mississippi,” said P.J. Waldrop, a legislative aide in Sen. Thad Cochran’s office who served as a staff assistant for the Senate Agriculture Committee. “We’ve seen many producers that were able to gain from this year’s high commodity prices. However, many others were affected by bad weather and the high cost of inputs.”

The 2008 farm bill provided an adequate safety net for Mississippi’s farmers, pointed out Waldrop.

“It also contained strong nutrition, conservation and rural development programs that are so important to rural economies,” he said.

Even though the total numbers aren’t in yet, farm gate income should be approximately $6 billion statewide, said Mississippi Agriculture Commissioner Lester Spell.

“That’s very good, considering the economy and other factors we experienced this year, such as escalating costs in diesel fuel and fertilizers, particularly nitrogen, which is tied directly to the cost of natural gas,” he said. “However, because of these factors, Mississippi farmers saw their profit margin decrease dramatically in 2008.”

Overall, definite trends continued to take shape. Over the last couple of years, production of cotton — traditionally a king crop in Mississippi — dropped from approximately 1.2 million acres to 365,000 acres, representing an approximate 45 percent reduction per year as a result of high input costs and competition worldwide.

“I wouldn’t be surprised at all to see cotton crops decrease to 250,000 acres in 2009, which would be an all-time low for the state,” said Spell.

Mississippi farmers are replacing some cotton crops with soybeans and corn, particularly soybeans, which are a good source of protein used in livestock feeds. Also beneficial: soybeans, which actually produce nitrogen, have lower input costs.

“The catfish industry has been extremely vulnerable to fluctuating prices,” noted Spell. “A conservative estimate is that we’ve lost 20% to 25% production over the last two years, partly due to catfish feed costs almost doubling. Farmers just can’t stay competitive between that and foreign competition. Mississippi consumers understand the difference between homegrown catfish being superior to foreign-raised catfish. Now we have to get the rest of the world to understand why.”

A bright spot in Mississippi agriculture: peanut production, which climbed to 21,000 acres in 2008, up from 14,000 to 15,000 acres two years ago. One reason for the jump is the new Birdsong Peanuts processing plant in Aberdeen, with five acres under roof and two warehouses.

“Traditionally, Georgia and Alabama have been big peanut-producing states, but disease caused by not rotating crops often enough brought business to Northeast Mississippi, where the sandy soil is good for peanut growing, unlike clay, which peanuts stick to,” explained Spell. “The Birdsong facility doesn’t shell the peanuts, but rather cleans them and removes empty hulls. Then they’re shipped to processing plants in Georgia.”

Timber has been greatly impacted by the housing market slowdown, which has resulted in a tremendous ripple effect, said Spell.

“Loggers have had to shut down some equipment, which is expensive to acquire and maintain,” he said. “Workers have been laid off; fuel suppliers have seen the effects. The whole chain has slowed down. Some mills have shut down temporarily, while others have reduced production. From what we’ve heard from industry experts, the next 18 months will be tough.”

Regionally, Delta farmers have reported good cash crops, with the new Sweet Corn production plant in Indianola aiding in the growth of corn crops.

“Looking forward, the Mississippi farmers who adapt to the changing world marketplace are the ones who will continue to be successful,” said Spell. “Crops that provide food and protein to humans and livestock will continue to prosper. Cotton for clothing: not so much.”

Contact MBJ contributing writer Lynne W. Jeter at Lynne.Jeter@gmail.com.

About Lynne W. Jeter

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