New Peanut Title Will Protect the Industry

HOUSE PASSES NEW PEANUT PROGRAM AS PART OF TEN-YEAR FEDERAL FARM BILL

The US House of Representatives voted 291 to 120 Friday to enact the Farm Security Act of 2001 (HR 2646) which includes a new federal peanut title vital to protecting the peanut industry, Congressman Terry Everett, R-Enterprise, announced.

Everett, chairman of the House Agriculture Subcommittee on Specialty Crops and Foreign Agriculture Programs, oversaw the drafting of the new peanut title earlier this summer. He credits the efforts of all sectors of the peanut industry to reach a historic concensus on a peanut title with its passage in the House today.

"In the face of certain elimination of the peanut program by political opponents coupled with the negative effects of reduced tariffs on foreign peanut imports, the peanut industry came together like never before to forge a new program which continues to provide a viable safety net for producers," Everett said.

"The new peanut title protects growers and eliminates the political opposition to the peanut program," Everett added. "The new title protects the peanut program by making it operate more like other commodity programs while providing compensation to quota holders who would see a phase-out of the current quota system.

Specifically, the new peanut title, included in the 2001 Farm Bill, phases out the quota system over five years while providing quota holders a ten-cent-a-pound per year buy-out for their quota peanuts over the five-year period. Furthermore, the program would be transformed into a market loan structure whereby the federal government guarantees growers a $350-a-ton market loan payment, while setting the domestic peanut target price at $480-a-ton. Peanut growers would also receive a $36-a-ton fixed decoupled (AMTA) payment.

"Absent these changes, our peanut industry would certainly not be able to survive the mounting political opposition it has garnered on Capitol Hill because of the unique nature of its current quota system," Everett noted. "In addition, tariffs on Mexican peanuts are decreasing every year and will vanish in 2008, thus undermining the current quota system."

"The passage of a new peanut title means a more stable future for our peanut industry which is so vital for the Southeast Alabama economy," Everett added.

On Friday, the US House passed the Farm Security Act. This ten-year Farm Bill sets federal farm policy for the next decade, including funding for commodity programs. The Farm Bill was shaped with the input of hundreds of farmers and industry experts during a series 47 hearings since March 2000, including a full House Agriculture Committee field hearing in Auburn, Alabama last year.