News Release

More Acres to be Planted in the US this Year?

BLACKFOOT, ID — Current market conditions may be leading to a planting season that could return growers to the kind of year that drove prices to disastrously low levels in 2000.

After five years of sustained losses, growers are finally in the black. Historically, a good profit year is followed by increases in acreage. The need to gain back equity growers have been losing since 1996, seems to be creating a strong pressure to push acreage up. Adding to that pressure is the fact that last year’s power buy-back is over, and those acres are almost sure to go back into production. The Klamath Basin should also return to production, after its catastrophic year, and that will add to downward pressure on prices.

Finally, the water shortage that was on the horizon just last week, seems to be easing. Reservoirs remain low, but snowpack is nearing normal levels. Even the canals that were preparing letters to inform shareholders they might not have had enough water, are backing off the worst predictions. It appears now there will be enough to finish crops this year. As one grower put it, “Nobody ought to be planning on planting our acres, because, by damn, we’re going to.”

Analysts figure the market may be able to absorb a small increase in acreage, but indications are now that unless growers throughout the West exercise a lot of restraint, we could see significantly larger increases than the market may be able to absorb.