Peanut Market News – October 24, 2016

PEANUT INDUSTRY LOSES GREAT LEADER

We are saddened to report the death of Bob White of Clarendon, TX after battling cancer for the past few years.  Bob was President of the Panhandle Peanut Growers Association in Texas and chairman of the National Peanut Board. The obituary can be viewed at the following link:  http://www.robertsonfuneral.com/obituaries/  Family request memorials be sent to Harrington Cancer Center in Amarillo, TX Kindred Hospice, or Advo Companies. Condolences may be sent to his wife Pat at:  4100 County Road 16, Clarendon, TX 79226.

HURRICANE MATTHEW DEVASTATES NC PEANUT FIELDS 

Eastern North Carolina was spared the full force of Hurricane Mathew because of an abrupt turn away into the Atlantic. But what at first was a sigh of relief has turned into a massive disaster because of unprecedented amounts of rain. Thousands of acres of cropland have been flooded and it may be days before the waters recede. Good clear weather is forecast for the next week to ten days, which is the only positive that can be found. If drying continues, digging on many farms could start the later part of this week. Most of the fields were ready to dig last week and are starting to shed peanuts. Many producers were looking at a 5,000 pound crop this year but are now hoping for at least 3,000 pounds per acre. Cotton has been severely affected not only by Mathew but also Tropical Storm Julia. Yields will be reduced dramatically and many will not harvest at all.  This is the second year in a row producers will face large losses. Let’s hope that clear skies prevail and the harvest goes well. (Reported by Bob Sutter)

SOUTH CAROLINA GETS HIT AGAIN 

Monty Rast, peanut farmer in Cameron, S.C. said his farm received 12 inches of rain, but wind damage was minimal  He stated he had harvested his Virginia crop, but a portion of the runner crop remained in the fields. SOUTHEAST FARM PRESS reports that early estimates indicate a significant loss of the cotton crop and moderate loss of soybeans in South Carolina. Many farmers were able to harvest peanuts before the storm hit, but seven of twelve peanut buying points were without power so storage could soon become an issue.  “Farmers are facing very similar challenges to last October’s flooding and this natural disaster will be another significant setback to our state’s No. 1 industry,” said South Carolina Agriculture Commissioner Hugh Weathers. “We are working diligently to ensure the needs of the farming community are heard in the aftermath of Hurricane Matthew.”

U.S. PEANUT EXPORTS

China and Vietnam continue to buy American peanuts when available.  Through August, the two countries have purchased 46.9 percent of the U.S. peanut exports (Jan-Aug).  Canada has moved back to the # 2 spot buying 15.9% of the exports including peanut butter, processed, raw kernels and inshell.  U.S. exports to the Netherlands is down 34% indicating that shellers are having trouble shelling EU specs which is required to ship into the EU (4 ppb aflatoxin).

Most of the U.S. export customers were increasing purchases of peanuts, especially after Argentina experienced harvesting problems.  One broker says that the differential for EU SPECS over USDA NON-EU-SPECS is $.08 to $.10 per pound, equivalent to between $176 & $220 per shelled metric ton.  U.S. shellers started shelling last week on the 2016 crop as the crop is suspect for aflatoxin especially since the crop experienced stress and hot weather during June/July & August and in some areas, the drought problems continue.  That means less peanuts available to the EU and higher prices for both domestic and export markets.  It is early to predict crop quality, but farmers have been advised to keep irrigated and non-irrigated peanuts separate.

SEG 2 REVISION NOT APPROVED FOR 2016 CROP

The Georgia Peanut Commission and the Georgia Farm Bureau have applauded efforts of the Peanut Standards Board which voted to raise the grading score used to classify farmer stock peanuts as SEG 2’s from 2.49 percent to 3.49 percent. However, this is a recommendation for next year and not in affect on the 2016 crop.  FSIS is reporting an increase in SEG 2’s and many farmers disappointed that the recommendation is not approved for this year.

ARGENTINA CROP  UPDATE

The 2016 peanut crop in Argentina ended with no good news, officials said, as excessive rains, and adverse weather generated an estimated loss of  at least 47,000 hectares plus deterioration of peanut quality, which is reportedly worse than expected. 

Despite all the problems, producers and peanut companies, especially in Cordoba are planning to continue growing and plan to focus on the foreign market, especially the European Union.  Javier Martinetto of AGD told the attendees at the China International Peanut Congress that Argentina has the possibility of providing more High Oleic peanuts.

With the U.S. sold out of the 2015 crop and reluctant to price 2016 until more of the crop is harvested, buyers will be concentrating on the upcoming new crops like India and China, plus the U.S.  Argentina is having trouble delivering EU quality required peanuts as some are being re-milled and that causes delays.  Argentina is getting ready to start new plantings and one official said that land rent per hectare has almost doubled, from $525 to $900 per hectare increasing the cost of delivering farmer stock to the warehouses.  Officials are expecting more acres, but planting peanuts depends on prices of corn and soybeans. 

via Peanut Farm Market News, a peanut hotline service of The Spearman Agency, Tyron Spearman, editor