Cotton and Peanut Crops suffer because of drought

By Shomial Ahmad

Atlanta, GA – The commodity prices for both cotton and peanuts has shot up in the past year. With most of the state in exteme drought, WABE reports that the yield from this season's crop could lead to higher prices later.

Cotton is a one billion dollar industry in the state, according to the Georgia Cotton Commission. The commission's Executive director Richey Seaton, says with high commodity prices, cotton growers were expecting a good year this year. But the drought changed that.

"We haven't had any rain in probably two, three weeks. And we're beginning to see it suffer again. Basically, we use overhead irrigation, and it's a supplemental watering system."

Seaton says that it's too soon to tell what losses are for cotton. But Georgia peanut growers are hard hit. The Georgia Peanut Commission estimates about a 20 percent loss to their half a billion dollar industry. Executive director Don Koehler says because of better markets for cotton and corn, more of those crops were irrigated.

"Our peanuts were put on dry land, or non-irrigated acres, to a larger extent where only about 35 percent [were] irrigated this year."

One result, one of the largest peanut butter manufacturers is expected to raise prices in November. The Wall Street Journal reports that Jif peanut butter products will go up by 30 percent. Gene Roney grows cotton and peanuts in South Georgia. He's hoping the high commodity prices will offset some of his losses.

"You can say most of the commodities are anywhere from 50 to 60 percent above their normal level. So that's again going to offset some of this disastrous weather we have had."

Back during the 2002 drought, Roney applied and received a low-interest $180,000 federal loan for his losses then. The government's making those loans available again this year, but Roney doesn't plan on applying.

"It's loaded down with such regulations, it's any wonder that anybody gets these loans at all. Now, if you only apply for five or ten thousand dollars, it's fairly easy."

Roney expects about 45 percent in losses this year. He hopes to recoup some of his losses through his federal crop insurance. And then he can borrow money next year and start again.