Peanut prices have soared in the past couple of months, driven by concerns over the quality of the US peanut crop. The USDA estimates the US peanut production unchanged y-o-y in 2019/20, at 2.49m tonnes, down 7% on the five-year average but up 2% on the ten-year average, so relatively an average crop. Yields are estimated at 4.43 tonnes per hectare, a decline of 1% compared to last season.
However, the volume of peanuts available for edible markets is currently tight due to problems with aflatoxin, following adverse growing conditions in the Southeastern Peanut Belt. In Georgia, the largest US peanut producing state, temperatures last year soared above 32°C for extended periods during the growing season between May and September, with September and October being extremely dry prior to the harvest. Similar conditions were observed in Virginia and Carolina.
“The US crop has an aflatoxin issue and plantings in Argentina are lower than last year”, according to a European peanut buyer. He also added “When that became apparent, there was a rush to cover and prices have jumped quickly.”
The Mintec Reference Price for US 40/50 peanuts delivered to Rotterdam stood at $1516 per tonne at the beginning of February, up 6% m-o-m and 20% q-o-q. Similarly, the Mintec price for Argentina’s peanuts has been moving higher, currently at $1561 per tonne, up 2% w-o-w and 6% m-o-m.