Impacts of the Farm Bill on Peanut Production in Southwest Alabama Steve Brown Extension Economist Alabama Cooperative Extension System

Peanut Enterprise Analysis Prior to New Farm Bill for Southwest Alabama Yield (3679 lbs. / Acre) Gross Farm Sales Government Payments and Crop Insurance Total Gross Farm Returns 4 Year Average / Acre $ $54.41 $1,013.56

Peanut Enterprise Analysis Prior to New Farm Bill for Southwest Alabama Total Gross Farm Returns Cash Expenses Amortized Quota Purchases Returns Above Operating Expenses 4 Year Average / Acre $1, $ $81.69 $278.78

Expected Effects on Peanut Profitability in Southwest Alabama Total Operating Expenses Cash Rent Prior to 2002 Total Operating Expenses Less Cash Rent 4 Year Average / Acre $ $ $475.66

Expected Effects on Peanut Profitability in Southwest Alabama Operating Expenses Except Cash Rent Projected Cash Rent for Expected Total Operating Expenses $ / Acre $ $70.00 $545.66

Expected Effects on Peanut Profitability in Southwest Alabama Expected Total Operating Expenses Breakeven Yield Based on $355/ ton Loan Rate Prior 4 Year Average Yield for Southwest Alabama Peanuts (tons/acre) Per Acre $ tons 1.84 tons

Projected Peanut Profitability in Southwest Alabama With-Out Base Peanut Sales (4 Year Avg. Yield x Loan Rate) (1.84 tons x $355) Minus Total Operating Expenses Returns Above Operating Expenses With-Out Government Payments $ / Acre $ $ $107.54

Projected Peanut Profitability in Southwest Alabama on Base Acres Returns Above Operating Expenses With-Out Government Payments Direct Payment (1.84 tons x $36 x 85%) Counter Cyclical Payment ($495-($355+$36) x 85% x 1.84 tons) Returns Above Operating Expenses With Government Payments $ / Acre $ $56.30 $ $326.50

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