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Planting Intentions Yield Few Surprises
MISSISSIPPI STATE -- Planting intentions announced Wednesday show Mississippi farmers reacting to low prices across the board by planting more cotton than last year.
Cotton saw the biggest gain in acreage, with 1.1 million acres projected for 1999 in Mississippi. Rice acreage also should be up, but not as high as originally intended. Both corn and soybeans acreage intentions are down for the year.
Dr. O.A. Cleveland, marketing specialist with Mississippi State University's Extension Service, said cotton acreage is up even though forecasts predict prices at harvest to be less than the cost of production.
"The price ratio of cotton to soybeans and cotton to corn favors cotton," Cleveland said. "Cotton prices relatively are better than corn and soybeans, but all three budget out to be a losing proposition."
Cotton prices are forecast to net farmers between 52 and 62 cents a pound at harvest. Cost for production for most growers will be 62 to 72 cents a pound.
"This is probably the worst price outlook I have seen in 25 years for cotton growers," Cleveland said. "One of the principal reasons we have such depressed prices is the significant decline in demand because of the world economic crisis. Our goods are not selling abroad, and the United States is the best market for foreign goods."
Despite this, Mississippi farmers intend to break their two-year trend of planting less than 1 million acres of cotton by planting 170,000 more acres than they did in 1998.
"Cotton is still the principal agriculture crop in Mississippi," Cleveland said. "It still employs more people, utilizes more inputs and requires more capital than the next three crops combined."
Of soybeans, rice and corn -- the next three major row crops -- rice is the only other crop that state farmers intend to plant more acreage.
Dr. Joe Street, rice specialist at MSU's Delta Research and Extension Center in Stoneville, said farmers earlier this year intended to plant 320,000 rice acres. That figure dropped to about 300,000 acres after a special crop insurance option was canceled.
"Rice is not as attractive as it was before the insurance change," Street said. "Rice prices right now are poor and I don't see any real favorable price increase coming soon."
Even with the lower price projections, rice acreage is up about 30,000 acres from 1998, continuing a three-year acreage increase.
Corn is the biggest acreage loser this year, with an expected 320,000 acres to be planted. Dr. Tom Jones, Extension agricultural economist, said this 42 percent decrease from 1998 will be coupled with very low prices.
"Farmers are planting fewer acres because they are wary of a repeat of last year's aflatoxin and very low prices," Jones said. "With prices this year down 50 cents a bushel, last year's prices will look wonderful in comparison."
Soybeans are also expected to take an acreage hit, with Mississippi farmers planting 1.85 million acres, down from 2.05 million in 1998. Soybean prices also are very low, having fallen below $5 a bushel.
"We're raising another 800,000 acres of soybeans in the United States," Jones said. "Demand is increasing, but not as much as supply and we're growing more than we can use."