Worst Harvest in 30 Years Spikes Peanut Butter Prices

Peanut Leaves and Pods
Photo credit: Wikipedia

Stacey mentioned in class that the price of peanut butter has skyrocketed following the worst peanut harvest in 30 years. According to this article by the Wall Street Journal (via the Pocono Record):

Another hot, dry summer has devastated this year's peanut crop, sending prices for the legume skyrocketing and forcing peanut butter brands including J.M. Smucker Co.'s Jif, Unilever NV's Skippy and ConAgra Foods Inc.'s Peter Pan into startling price increases...

Weather is the ultimate nemesis of any farmer. That's why the cotton farmers in Travels of a T-Shirt use technologies to protect cotton from, and to "control," the weather. It's also one of the reasons why the US government subsidizes farmers--to prevent bad years from sinking farmers so that they can profit from the good ones. According to Huffington Post, peanut butter's not the only product that's increasing in price owing to a poor harvest.

French wine and Italian pasta are some other endangered national exports impacted by climate change. Last week, a report claimed chocolate could become a luxury item if farmers in West Africa didn't adapt to the warming climate.

Even with a bumper crop, however, the price of peanuts will likely climb regardless. As the government continues to subsidize cotton and corn, farmers will devote more acreage to those crops and less to others, including peanuts. This will decrease the supply--and increase the price--of peanuts.

Peanuts are an important part of the American agricultural economy. They put nitrogen back into the soil, as opposed to most crops that deplete nitrogen. Peanuts allow planters to rotate crops to maintain soil integrity, use fewer artificial fertilizers, and yet still produce a crop that can earn them some money on the market.