Things you should know Things you should know about crop production in about crop production in

Alabama Alabama

Bob Goodman, Extension Bob Goodman, Extension EconomistEconomist

Crops in AlabamaCrops in Alabama

Cotton 3.8 M acCotton 3.8 M ac Peanuts ½ M acPeanuts ½ M ac Corn 3.8 M acCorn 3.8 M ac Soybeans 2.1 M acSoybeans 2.1 M ac Wheat .725 M acWheat .725 M ac

Sweet PotatoesSweet Potatoes Sweet CornSweet Corn TomatoesTomatoes WatermelonsWatermelons PotatoesPotatoes

Crops in AlabamaCrops in Alabama

Cotton Cotton - 409 lb/ac to 766 lb/ac- 409 lb/ac to 766 lb/ac PeanutsPeanuts - 1490 lb/ac to 2675 lb/ac- 1490 lb/ac to 2675 lb/ac CornCorn - 55 bu/ac to 107 bu/ac - 55 bu/ac to 107 bu/ac Soybeans Soybeans - 16 bu/ac to 35 bu/ac- 16 bu/ac to 35 bu/ac Wheat Wheat - 34 bu/ac to 54 bu/ac- 34 bu/ac to 54 bu/ac

Yield Variability

Recent Cropping History Recent Cropping History

Cotton: stable at 5-600,000 acres. Cotton: stable at 5-600,000 acres. Soybeans: losing gulf acreage, stable at around Soybeans: losing gulf acreage, stable at around

180-200,000 acres in NW.180-200,000 acres in NW. Corn: susceptible to drought and heat, usually Corn: susceptible to drought and heat, usually

plant about 200,000 acresplant about 200,000 acres Wheat: Planted acres increased for no-till, Wheat: Planted acres increased for no-till,

harvested acres decreasingharvested acres decreasing Peanuts: Loss of program is moving peanuts Peanuts: Loss of program is moving peanuts

into new areas of state. Acreage constant at into new areas of state. Acreage constant at 190-200,000.190-200,000.

Cropping History Cropping History

Many areas in Alabama are marginal crop Many areas in Alabama are marginal crop production areas:production areas:

““Poor” soils? – Piedmont, black-belt, coastal Poor” soils? – Piedmont, black-belt, coastal plains plains

““Never more than a week away from a drought” Never more than a week away from a drought” – Summer rainfall pattern– Summer rainfall pattern

Lack of irrigation potentialLack of irrigation potential Small, irregular fieldsSmall, irregular fields Rolling topographyRolling topography History of under-capitalization, low productionHistory of under-capitalization, low production

Cropping History Cropping History

Some areas are prime crop production Some areas are prime crop production areas: same areas TN valley, Wiregrass, areas: same areas TN valley, Wiregrass, Coastal PlainCoastal Plain

Would continue to produce without Would continue to produce without government commodity paymentsgovernment commodity payments

Greater capitalization, better management, Greater capitalization, better management, more production inputs, increased use of more production inputs, increased use of new technology, larger farms new technology, larger farms

Recent Cotton DevelopmentsRecent Cotton Developments

Boll Weevil Eradication – early ’90’sBoll Weevil Eradication – early ’90’s Budworm resistance and Bt - 1995Budworm resistance and Bt - 1995 Roundup-Ready cotton - 1998 Roundup-Ready cotton - 1998 Crop Rotation with corn or peanuts Crop Rotation with corn or peanuts Export trade and the domestic textile Export trade and the domestic textile

industryindustry

CottonCotton

About 80% transgenicAbout 80% transgenic Roundup-readyRoundup-ready BtBt StackedStacked

About 80% Conservation TillageAbout 80% Conservation Tillage Cover CropsCover Crops Stubble CroppingStubble Cropping Spindle pickedSpindle picked

Most cotton in Alabama does not receive an Most cotton in Alabama does not receive an over-the-top insecticide treatment.over-the-top insecticide treatment.

PeanutsPeanuts

Now a commodity program cropNow a commodity program crop Loan price is $355 per ton, old price Loan price is $355 per ton, old price

support was about $600 per tonsupport was about $600 per ton Twin row, No-till adoptionTwin row, No-till adoption Peanut acreage shiftingPeanut acreage shifting

SoybeansSoybeans

2 Million acres in 1979 down to 200,000 2 Million acres in 1979 down to 200,000 Roundup-Ready and conservation tillageRoundup-Ready and conservation tillage 1994 Plant Variety Protection Act1994 Plant Variety Protection Act

Emergence of private patented varietiesEmergence of private patented varieties

CornCorn

Emerging as important rotational crop for Emerging as important rotational crop for cotton in North Alabamacotton in North Alabama

Amenable to new technology:Amenable to new technology: BtBt Twin-Row plantingTwin-Row planting High plant populationHigh plant population Precision AgPrecision Ag

WheatWheat

Planted for grain, forage, coverPlanted for grain, forage, cover Weed control, disease control is an issue if Weed control, disease control is an issue if

planted for grainplanted for grain

  Variable Fixed Total

  Expenses Expenses Cost

Upland cotton 366 86 452

Peanuts 496 108 604

Corn for grain 155 68 223

Soybeans 125 69 194

Wheat for grain 120 70 190

Crop Expense SummaryCrop Expense Summary

  Total Expected Total

  CostGross Return Profit

Upland cotton 452 490 38

Peanuts 604 700 96

Corn for grain 223 280 57

Soybeans 194 240 46

Wheat for grain 190 210 20

Crop Costs and ReturnsCrop Costs and Returns

Crop InsuranceCrop Insurance

MPCI – Multi Peril Crop InsuranceMPCI – Multi Peril Crop Insurance Based on 50-75% APH x 55-100% RMA crop Based on 50-75% APH x 55-100% RMA crop

priceprice

CRC – provides revenue protection based CRC – provides revenue protection based on price and yield expectations by paying on price and yield expectations by paying for losses below the guarantee at the for losses below the guarantee at the higher of an early-season price or the higher of an early-season price or the harvest price. harvest price.

Commodity ProgramsCommodity Programs

Fixed PaymentsFixed Payments Countercyclical PaymentsCountercyclical Payments Loan Deficiency PaymentsLoan Deficiency Payments Emergency Program PaymentsEmergency Program Payments

Commodity ProgramsCommodity Programs

55

80

105

Fixed Payment

CountercyclicalPayment

Loan DeficiencyPayment

Target Price

Market Price

Loan Rate

Fixed and countercyclical payments are “decoupled” fromproduction and are made on 85% of a farm’s “base” crop acreage. Peanuts are a commodity crop in this program.

Promote Market StabilityPromote Market Stability Assist Conservation of Natural ResourcesAssist Conservation of Natural Resources Insure Self-SufficiencyInsure Self-Sufficiency Preserve the rural economy and communityPreserve the rural economy and community Help all agricultural sectorsHelp all agricultural sectors Allow alternative uses for commoditiesAllow alternative uses for commodities Have a history of successHave a history of success Are relatively inexpensiveAre relatively inexpensive

Commodity ProgramsCommodity Programs

A Pictorial History of Alabama Agriculture:

From Cotton Fields to Catfish

Photos compiled f rom textbooks, A.U. Archives, and private collections.

Charles Mitchell

Extension Agronomist-Soils & Professor

Issues for the futureIssues for the future

Role of Public Sector and NGO’s in Role of Public Sector and NGO’s in technology development and ownership of technology development and ownership of genetic material.genetic material.

The importance of our agricultural identity The importance of our agricultural identity and heritage in the face of an increasingly and heritage in the face of an increasingly urban society.urban society.

Adoption of new technologyAdoption of new technology GeneticsGenetics Precision agriculturePrecision agriculture