The global market badly needs peanuts, one market expert pleaded to more than 400 growers at the annual South Carolina Peanut Growers Meeting organized by the Clemson University Cooperative Extension Service.
Nationally, peanut warehouses are expanding and shelling companies are upgrading to increase output as market demand has exceeded supply, said Tyron Spearman, editor of the Peanut Farm Market News and executive director of the National Peanut Buying Points Association.
“That is a grower’s market. We need more peanuts,” Spearman told a standing-room-only crowd. “You are fixing to see a miracle year for peanuts, I think.”
Peanut usage jumped 27 percent last year on strong demand for peanut butter and candy, according to U.S. Department of Agriculture figures. Record-high exports of U.S. peanuts are expected to continue and U.S. supply should decline 7 percent to around 3.8 million tons, said Clemson Extension agricultural economist Nathan Smith. A tighter supply will help prices improve to $425 to $500 per ton depending on type.
The quality of the 2016 crop is a concern in the Southeast, which could lead to some price improvement by the end of the marketing season. The continuation of exports to Asia, in addition to Europe and other destinations, will be key for 2017 prices, Smith said.
U.S. peanuts have found opportunities in global markets as crop quality was poor for competing growers in countries like Argentina, said Dell Cotton, manager of the Peanut Growers Cooperative Marketing Association.
Cotton stressed the importance of global trade to the nation’s agricultural industry. Nearly 75 percent of the nation’s cotton crop is exported, and China is a major importer of U.S. peanuts, he said. From January through October, nearly 41 percent of U.S. peanut exports were shipped to China.
“We cannot afford to lose any of these markets,” Cotton told the packed room. “China is a very important market to us. Make sure you tell our leaders how important trade is to our profession.”
In the United States, overall peanut consumption is up 3.3 percent.
“Peanut consumption is growing faster than overall population, so people are eating more peanuts,” said Keegan Treadaway, marketing specialist with the National Peanut Board.