Presented by: James W. Monahan

Deputy Administrator, Commodity Operations Farm Service Agency

June 25, 2013 Amelia Island, Florida

Topics for Discussion

DACO Organization Procurements for Domestic Feeding Programs 2012 Crop Production and Exports Loan Activity Options for Potential Peanut Forfeitures

2

AN EQUAL OPPORTUNITY EMPLOYER AND PROVIDER3

Farm Bill Updates Food, Conservation, and Energy Act of 2008 Expired

in 2012 The American Taxpayer Relief Act of 2012 Extended

the 2008 Farm Bill for One Year

Senate Passed a New Farm Bill

Voted Down in the House of Representatives 4

Procurements for Domestic Feeding Programs

FSA Purchases Peanut Products for Domestic Feeding Programs

FY 2013 Year-to-Date Peanut Product Purchases Total 19,212,480 Pounds of Product Valued at Over $21.3 Million

FY 2012, Peanut Product Purchases Totaled 29,740,960 Pounds, Valued at Over $43.1 million

5

44%

19% 3%

33% TEFAP

CSFP

NSLP

Peanut Product Procurements by Program FY 2013 Year to Date

FDPIR

6

Crop Year Production (Tons)

2006 1,732,125

2007 1,836,125

2008 2,581,200

2009 1,845,825

2010 2,078,420

2011 1,829,295

2012 3,370,700

Peanut Production 2006 – 2012 Crop Years

7

Peanut Exports for 2011 and 2012 Seasons (Farmer Stock Basis)

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

Aug Sep Oct Nov Dec Jan Feb Mar Apr

‘000

sho

rt to

ns

2011 2012

U.S. peanut exports year-to-date up 141 percent in 2012

2012 versus 2013 2012 Crop Year 2013 Crop Year

Estimated

Planted Acres 1,638,000 Acres 1,191,000 Acres

Yield 4,192 pounds per acre 3,800 pounds per acre

Production 6,741 million pounds 4,435 million pounds

Beginning Stocks 1,003 million pounds 2,442 million pounds

Total Supply 7,815 million pounds 6,942 million pounds

9

Peanut Marketing Assistance Loans and Loan Deficiency Payments

Provide producers with short term financing at the time of harvest.

Support the orderly marketing and distribution of peanuts throughout the year.

Provide income support when market prices are below statutory levels.

10

2012-Crop Loan Maturity, Selected Dates (in thousand short tons)

0

100

200

300

400

500

600

700

Jun '13 Jul '13 Aug '13 Sep '13 Oct '13

13-May-13 20-Jun-13

2012 Redemptions are Lagging

* Cumulative

0

10

20

30

40

50

60

70

80

90

100

Oct

. 5

Oct

. 19

Nov

. 2

Nov

. 16

Nov

. 30

Dec

. 14

Dec

. 28

Jan.

11

Jan.

25

Feb.

8

Feb.

22

Mar

. 8

Mar

. 22

Apr.

5

Apr.

19

May

. 3

May

. 17

May

. 31

13-J

un

Jun.

28

Jul.

12

Jul.

26

Aug.

9

23-A

ug

6-Se

p

20-S

ep

4-O

ct

18-O

ct

Perc

ent o

f pla

cem

ents

2009-11 crop avg. 2012 crop

Crop Year 2006 2007 2008 2009 2010 2011 2012

Loans Made (Million $)

581.3

473.9

730.9

599.1

630.2

490.0

791.1

Quantity Forfeited (tons)

455.51

436.23

5,905.87

2,955.60

0

0

TBD

Value Forfeited ($)

152,618

138,279

2,066,318

1,062,982

0

0

TBD

Peanut Loan Placements and Forfeitures

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What Happens When Peanuts are Forfeited?

CCC pays storage during the loan period.

Producer responsible for storage before the loan period.

CCC refunds to producer the storage paid from date all loan documents are received through the storage paid through date

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What Happens When Peanuts are Forfeited? Continued…

If the “Storage Paid Through” date is blank, CCC will begin paying storage to the warehouse on “Storage Start Date” and the producer will be billed for storage that accrues before loan documents are received.

CCC will not require a refund of load-in/handling charges.

15

Commodity Credit Corporation Disposition Policy

When commodities come into CCC inventory, our general policy is to dispose of commodities as rapidly

and orderly as possible, either through third party bartering or other

direct methods such as sales or exchanges.

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Options for CCC-Owned Peanuts

Hold and Store Sell back into the market – Restricted or

Unrestricted Use Barter Ourselves or Through a Third Party Barter for Peanut Products Barter for Products Requested by the

Food and Nutrition Service and the Foreign Agricultural Service

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Barters Crop Year 2006 Through 2009 Peanut Forfeitures

Totaled 9,753 tons

Of this Quantity, 9,328 Tons were Transferred to a Third Party for Barter

The Remaining 425 Tons were Bartered Internally in Exchange for 194 tons of Peanut Butter for Use in the Domestic Feeding Programs

18

Peanut Products Received in Barters

Since CCC Began Bartering Through a Third Party in September 2007, We Have Received Over 1.2 Million Cases of Peanut Butter for Use in Domestic Feeding Programs

This Peanut Butter was Valued at $18.4 Million

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Any questions? 20