Washington, D.C. – Georgia Peanut Commission (GPC) board members met in Washington, D.C. with top U.S. Department of Agriculture (USDA) officials to discuss the loan repayment rate as part of the marketing loan program for peanuts. The commission has met on numerous occasions with the USDA on the loan repayment rate issue. However, this is the first time GPC has met with the USDA, since the May 2 Senate Agriculture Committee hearing on a review of the peanut program.

The commission has advocated since the 2002 Farm Bill was signed into law that USDA sets the loan repayment rate for peanuts too high. The GPC believes USDA has relied far too much on data unrelated to the price other export nations are marketing peanuts for in the world marketplace. U.S. peanut producers have lost a significant portion of their export market. The present export situation is directly related to the high loan repayment rate set by USDA. Although peanut state members of Congress have tried to assist producers in meetings with USDA, letters and inquiries in formal hearings since the 2002 Farm Bill, the rate has remained artificially high. The 2002 Farm Bill directed the Secretary of Agriculture to establish a loan repayment rate that the secretary determines will:

• Minimize potential loan forfeitures
• Minimize the accumulation of stocks of peanuts by the Federal Government
• Minimize the cost by the Federal Government in storing peanuts
• Allow peanuts produced in the United States to be marketed freely and competitively, both domestically and internationally.

It is this last point that is most problematic. The commission believes that USDA is not sufficiently considering the competition in the world marketplace.

The purpose of the USDA meeting was to address issues discussed in the Senate hearing held May 2, and how Georgia’s peanut producers could work with USDA to improve the current loan repayment rate problem.

“ We were very pleased with our USDA discussions. The USDA is interested in any new data that reflects a more accurate posted price,” says Armond Morris, GPC chairman. The commission will continue to provide information to USDA that better reflects the prices our export competitors are selling peanuts in the marketplace. To have a successful marketing loan program, Georgia growers must reclaim our export market and the only way this will occur is through a lower posted price.”

The commission also discussed the next farm bill and how they can work closely with USDA as the peanut program continues to improve for peanut producers.

Georgia’s Saxby Chambliss, chairman of the Senate Agriculture Committee has scheduled a Senate Agriculture Committee hearing on June 23, 2006 in Albany, Ga. To obtain more information about the hearing, visit www.americanpeanuts.com.