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USDA to pay sugar beet growers to destroy crops
By Jeff Zent, The Forum
September 5, 2001
 
The idea of plowing up fields of thriving sugar beets goes against Craig Halfmanns instincts.

Still, thats what the Stephen, Minn., farmer and hundreds of other sugar beet growers in the Red River Valley are likely to do this harvest season.

The U.S. Department of Agriculture is going to pay the nations sugar beet and cane farmers to destroy some of their crops.

The Agriculture Department has again approved the Payment-in-Kind program to reduce the nations surplus sugar inventory and its storage costs, said Jim Jost a program specialist with the state Farm Service Agency office in Fargo.

The government is paying $1.35 million a month to store its 741,000 tons of sugar, a USDA news release says.

The program should also help shore up the nations faltering sugar industry and ease the threat of loan forfeitures, said Mark Weber, executive director of the Red River Valley Sugarbeet Growers Association.

In exchange for destroying some of their crops, farmers will receive PIK certificates which represent government-owned sugar in storage.

Area farmers will turn in the certificates for cash and their cooperatives will take possession of the surplus sugar.

The USDA will divert 200,000 tons of government-owned sugar. Farmers will be paid up to $20,000 to destroy a portion of their 2001 beet and cane crops, Jost said.

Sign-up for the program will be held Sept. 1021.

The government offered sugar beet growers a similar PIK program last year, but the bidding process will be more competitive this year, said David Berg, Moorhead-based American Crystal Sugar Cooperatives vice president of agriculture.

More farmers will be bidding to divert fewer acres of production this year, Berg said.

Last year, only sugar beet growers qualified for the program and the USDA accepted acreage bids to offset about 300,000 tons of government-owned sugar, Berg said.

This year, the Red River Valleys beet growers may have pledge to destroy more beet acres for the same maximum payment of $20,000, he said.

On average, producers in the Red River Valley will pledge to destroy about 25 acres of sugar beets to collect the full payment.

Reducing the inventory by 200,000 tons is not going to have a hugely bullish impact on the market, but we still think its a step in the right direction. Berg said.

Weber called the program a good step toward restoring sugars supply and demand.

American Crystal Sugar shareholders plowed under about 33,000 acres in last years program. Members of the Wapheton-based Minn-Dak Farmers Cooperative destroyed about 8,700 acres of sugar beets.

Readers can reach Forum reporter Jeff Zent at (701) 241-5526