We in Congress have the responsibility for the formulation of farm policy that serves the interests of both farmers and consumers.
In my opinion, a very strong case can be made that the peanut program does a better job of balancing those interests than any other farm program.Put simply, what the peanut program does is allow American peanut farmers to provide a continuous supply of reasonably priced peanuts to the market while maintaining reasonable returns to producers.
The program has provided stability for farmer income and stable prices for the manufacturers of peanut butter, peanut candies and other peanut products. This stability has worked to everyone's advantage.
The supply of quota peanuts to the domestic market is strictly controlled by decisions made each year by the secretary of Agriculture, although traditional peanut farmers do enjoy some quota and price protection. However, any farmer in the United States may choose to grow as many non-quota peanuts as he likes, with these so-called "additional" peanuts being available to the export market at competitive prices.
Not only does the production of additional peanuts help us in the expansion of our export markets but it provides a backup in cases of drought, such as was suffered in certain parts of the peanut belt, particularly in Georgia, in 1990.
Changes made in the 1985 farm bill now allow farmers who were not quota holders to enter into the quota system by permitting such farmers who qualify to share in increases in the national poundage quota and in quota poundage reduced from farms for non-production.
These changes and improvements in the system have allowed for an orderly expansion of production to the point that peanuts are now grown in 71 congressional districts in 16 states, including Georgia, Alabama, Virginia, North Carolina, Texas, Florida, Oklahoma, New Mexico, South Carolina, Mississippi, Arkansas, Tennessee, Louisiana, California, Arizona and Missouri.
Because of the 1990 drought, peanut supplies are tight, but there is no shortage. We have demonstrated conclusively that, in spite of the drought, American farmers produced fully adequate supplies of peanuts to meet all domestic needs.
With 1991 crop peanuts ready for harvest soon, there are still more than 6,000 tons of 1990 crop year peanuts held in farmer-owned area pool stocks, and several times that amount readily available from industry sources in all three major production areas.
Further, the U.S. Department of Agriculture estimates that the total 1990 crop year carry forward was more than 250,000 farmer stock tons. To allow the importation of 300 million pounds of foreign-grown shelled peanuts into a market that is adequately supplied would be the equivalent of throwing gasoline onto a fire that was already burning brightly.
The argument that such imports would have neither effect nor cost for the domestic peanut program is ridiculous.
Any imports would interfere with the 1991 price support program and would create Commodity Credit Corporation losses based on each ton of imports replacing a ton of 1991 crop domestic peanuts.
The costs to the government of crushing a domestic ton of farmer stock peanuts would be approximately $400 to $450 a ton. Allowing imports could result in total government costs of $75 million to $85 million.
Most important of all, allowing such imports would have little or no effect on the shelf price of peanut butter and peanut candy to American consumers and would increase the possibility of introducing foreign plant diseases into the United States.
(Rep. Hatcher, D-Ga., is a member of the House Agriculture subcommittee on tobacco and peanuts.)