Additional segregation 2 and additional segregation 3 - Each of these pools are loss pools. The additional price support is supposed to be set low enough as to ensure no losses to CCC even if the peanuts are crushed. These losses will be charged to CCC and not have to be covered by the profit pools. Losses not covered by individual compliance were covered by the additional segregation 1 pool. Now is when you really need to start paying attention to what I am writing.
Buybacks are nothing but additional peanuts bought for domestic use just like quota.
When you add the buybacks and quota purchased together, there were too many peanuts purchased for domestic use. Many of these will be carried over the 1999 crop year. While this is a problem with Virginias and our area, the problem pales in comparison to the magnitude of the problem with the Southeast and runner type. It is doubtful if the Southeastern quota, given close to an average crop, will be purchased in its entirety for commercial use in 1999. There are many in the industry who believe that 100,000 tons of quota will be forced under loan and be crushed in the southeast from the 1999 crop.