PEANUT MARKET HAS LOTS OF UNCERTAINTY

            BROKER VIEW (AI) The international market has seen a lot more activity than the US domestic market has seen. (AI & TS)

            The international market is faced with a dwindling supply from all origins with the only help coming possibly from the US and China. Nevertheless, China continues to face struggle with its exchange rate, now at 6.71, and its high freight rates. The US should be able to help some, at least on the raw peanuts. There is still some current crop that is available at competitive levels although those levels continue to increase, and its supply continues to go down. As to the US new crop, it is unclear at this time what the quality of the crop will be. Moreover, prices are already much higher than current crop.

            It looks almost certain that international prices will continue to increase, no matter if for Western Europe or other markets.

            Argentina planted 25/26% less. Despite projecting higher yields, heavy delays in harvesting 20/25% of the crop will result in much lower availability for traditional markets. Argentina is looking to plant at best a similar crop than this past year.

            Brazil had a reduction of 30% with their previous crop and their new crop plantings could be reduced by a similar number.

            India had similar plantings to last year, but rainfall issues could result in a lower output for this coming new crop. Any major disruptions to their new crop yields would have dramatic effect on the supply to Asian markets and consequently to the international market.

            To make matters worse, competing commodities are at multi-year highs, meaning that shellers will most probably have to pay higher prices to have peanuts planted in the short/mid future. Obviously, that can change. Inflation continues to be extremely high meaning that costs for farmers and shellers are increasing, further complicating things. Manufacturers’ costs are increasing in an environment where peanut consumption is struggling.  

            The US domestic market, despite its more than adequate supply for the 2025 crop, has seen its prices firm up the past month to the higher 50’s, not to the level of the 2026 crop, but getting closer. All signs point to those prices getting close to 2026 crop by year end. 2026 crop on the other end is staying firm in the low to mid 60’s. The crop is developing relatively well despite high temperatures (which have now subsided) and needing a little more rain.

            Despite the smaller 2026 crop, the total supply for this coming season should be adequate considering the record 2025 crop carryover. Soon, our focus will switch to the 2027 crop where plantings will need to be increased to ensure an adequate supply. As previously mentioned, the cotton market is key not only to the 2027 crop but also to the 2026 crop.

USA MARKET – Broker View

            Despite a smaller 2026 crop, the total supply for this season should be adequate considering the record 2025 crop carryover. The unknown factor is the quality of that carryover which could potentially impact supply. But considering that so far we have only had 22,842 fst forfeited (13,848 fst of Virginias related to the Golden Grove issue, 5,728 fst of mostly Spanish peanuts in TX and 3,265 fst in VA probably Virginia peanuts), there doesn’t seem to be too much of a quality problem, at least not enough of a problem to warrant forfeitures (most probably driven by price differential). There still is roughly 389,000 fst in the loan (127,000 fst for September, 238,000 fst in October and 23,000 fst in November) with the majority being in GA.  

            Despite the lack of demand, the current crop market has seen its prices firm up to the high mid to high 50’s depending on shellers and cuts. Even no.1 that were so weak for so long have moved up to the low 50’s. EU quality is commanding a premium, premium depends on cuts and shellers. For 2026 crop, prices continue to be firm in the low to mid 60’s. It is unclear what premium shellers will demand for EU quality not knowing at this time what quality this crop will be. I do not expect much movement in those prices until such time 1/the crop gets harvested and that shellers have had the time to figure out the size and quality of the crop 2/the shellers understand what price they will pay for the uncontracted farmer stock 3/the shellers try to figure out December 2027 cotton price direction and its impact on 2027 crop plantings.

            On the demand side, we are not seeing much interest through the end of the year with the exception of renewed interest coming from the EU. Current crop prices are more competitive than Argentine prices on raw product. New crop prices on the other hand are somewhat competitive on jumbos, but slightly higher than Argentine on mediums.

            There are rumors that US farmer stock imports could be banned in China. The US is the only origin that export farmer stock to China.

            On the positive side, the US/China trade deal recently agreed by Trump/Xi includes US peanuts (both shelled and farmer stock). This should normally mean that the additional 10% tax when importing US peanuts will be cancelled. No word on the date of implementation but could be October 1^st.

            Some news from the shelling industry: “Jonesboro Right Now” has published that Delta Peanut would be ceasing operation in October. If this were to happen, it is unclear how many lbs were sold for the 2025 crop and 2026 crop, but if and once Delta peanut closes, most of those customers who bought from Delta will have to come back into the market to cover those lbs. This would be an unexpected demand.

             As to the Arkansas farmers, the AK governor provided a $5 million loan which should enable farmers to bring their peanuts to the buying points. As to what happens to those tons is unclear. Farmers were released from their obligations, thus famers could sell their peanuts to any suitor. The problem though is that Delta Peanut is the only sheller in AK and that famers would have to find shellers either in TX or the Southeast to buy their peanuts or alternatively leave their peanuts in the loan.

NATIONAL POSTED PRICE          SHELLED MKT PRICE                      MARKET LOAN                WEEKLY PRICES

  USDA each Tuesday at 3 PM                                                              USDA - 9 - Mo. Loan               Average prices

PEANUT STOCKS & PROCESSING – Summary of August - 

Aug 25 vs. Aug 24: Peanut candy down 7.52%, Peanut Snacks down 9.18%, Peanut butter down 2.14%, Other products down 8.57%, Total edible down 4.52%, In-shell up 41.85% 

PEANUT EXPORTS - Jul 2026 vs. Jul 2025: the US exported 49,179 mt,  an increase of 66% vs. the same period last year but much lower than last month. Exports to China are continuing but at a much lower pace than the previous several months. Exports to China were up 788% with 14,377 mt exported.

            Mexico was up 17%, Canada up 28% and the EU27 was surprisingly up 51%. Otherwise, Japan was down 18% and the UK down 61%..

WHAT THE NUMBERS ARE SAYING – FROM USDA

            The early peanut contract prices being offered, the increase in the cost of production, and a poor domestic demand caused farmers to plant fewer acres of peanuts and if cotton had made a run on price, the peanut acreage cutback would have been more.  The planted acres are down 27.6% and harvested acreage will be down 28.8%.  The reduction should spark a increase in price, however the carry forward of 1,600,000 tons meant that buyers were comfortable with inventory and could buy peanuts as needed.

            Amazingly with all the farmer cutbacks, the total supply of 4,234,000 tons is about average. (See Total Column)

Demand is better than markets indicate (based on the numbers) as domestic food is predicted to increase 3% and exports are also positive, up 1%.  When checking with brokers, the response was “Silence from buyers!”

            Meanwhile, evidence is not in the charts about what shellers are having to pay farmers for the 2026 crop. Some report farmers placing peanuts in a sheller pool at minimum of $400 per ton (runner type) with loan payment hoping prices will improve to redeem the peanuts from the loan and pool pay-out will be higher. Other farmers have signed $500 per ton on limited tons and some farmers signed $550 per ton with tons limited. Some farmers have optioned to place peanuts in the loan for $390 per ton sit and will follow the market for 9 months as loan must be repaid to the loan.