The recent scare from salmonella-tainted peanut products could not have come at a worse time for peanut farmers. They were already facing a bleak year before 500 hundred people got sick and at least eight people died from eating peanut products that originated at a plant in South Georgia.
"Last year brought a bumper crop with record prices," reports Russell Grantham of The Atlanta Journal-Constitution. "This year, companies that buy peanuts —- brokers, shellers and food and snack manufacturers such as Mars and J.M. Smucker Co. —- already have warehouses full of last year’s crop." Farmers got top dollar last year because of a peanut shortage. This year, however, prices have dropped nearly 50 percent in some cases, and peanut contracts are practically nonexistent.
The latest salmonella outbreak "seems to have sharpened a looming recession for Georgia’s agricultural industry," writes Grantham. "While prices for this year’s expected crop were already plunging because of the oversupply of peanuts, the salmonella scare threatens to drive down demand for an extended period." Georgia is the largest peanut producer of peanuts, accounting for nearly half of last year's crop. Estimates suggest that the income loss to Georgia farmers could be as much as $2.5 billion. (Read more)
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