Peanut Market News – Feb. 22, 2016

U.S. Rep. Trent Kelly Believes in Agriculture

At the Memphis National Peanut Buying Points Association Convention, Congressman Trent Kelly told the attendees that there are two things to keep America Great, STRONG MILITARY and FARMERS which gives the country the ability to sustain.  He said, “American has always been an agricultural nation and that will continue.”  A member of the House Ag Committee, Rep. Kelly praised Chairman Conaway from Texas for his leadership and a strong positive relationship with the members of the committee.  Kelly confirmed that Rep. Conaway is already working on the 2018 Farm Bill.

Redding Talks Priority for Agriculture

Bob Redding of the Redding Firm in Washington told buying point managers that the challenge next year is to protect the Farm Bill, protect crop insurance which has suffered budget cuts, and protect that peanut provisions.  He said there will be effects to ‘eliminate all of it’ with the attitude of  “ALL OR NOTHING.” He noted that Pro-Ag votes continue to decline.

Preparation for the next Farm Bill is already underway and regional session will soon be set, a hearing is set on cotton and the field hearings will follow seeking suggested changes.  Bob noted that the Senate is key, “The Senate saved the peanut program before!”  He noted that 34 Senators (10 Republicans and 10 Democrats) are up for re-election

He pointed out that the House Ag Committee has strong leadership for agriculture including Rep. David Scott of Georgia as a Committee Chair, Rep. Rick Crawford is a sub-committee chair, Rep. Conaway of Texas is a strong leader…noting that for agriculture, “This is a good team, none likely to roll…we are positioned well!”

Redding confirmed that a Washington Lobbyist had been hired by an ag group from Nicaragua to monitor the peanut program and others to determine if ag policies hurt their farmers.   Redding said the challenge this year is to identify ag advocates and provide them information in favor of agriculture.  He challenged the peanut industry to support the Political Action Committees, especially farmers who have benefited from government support

Bergman Talks Peanut Storage

Ned Bergman, Chief of the Examination Branch of the Warehouse License and Examination Division told attendees at the Buying Point s Convention that the peanut industry has 32 licenses with 334 warehouse locations approved for storing peanuts. 

The capacity approved is over 3.8 million tons, but for farmers, the warehouse location may not be near the farm or shelling plant.   This compares to 29 licenses covering 308 warehouses and 3.45 million tons last season.

Bergman said that the exchange invitation wanted to barter bulk peanuts for up to 1,200 tons of snack sized commercially packaged dry roasted unsalted peanuts for use in the Foreign Food Program with a destination to Haiti.

Peanut loans this year have totaled 2,225,000 tons with forfeitures unknown.  From the 2014 peanut crop, loans totaled 2,122,183 tons with 113,167 tons forfeited.  The 2013 crop had 1,452,216 tons with only 20,797 tons forfeited. 

Bergman reviewed the Texoma Peanut Company project that resulted in a company filing bankruptcy, 16 warehouse locations in 4 states, equity contracts not assumed and multiple owners of stored peanuts.  He said this problem started in November, 2014 and final payments about finished.

Anupam Jindel Discusses World Peanut marketBergman Talks Peanut Storage

At the NPBPA Convention, Anupaw Jindel, President and head of Peanuts Division of Olam International Limited, showed that the world peanut market is assured of a plentiful supply of peanuts, over 40m MT.  India declined due to poor weather but substantial increase in runners in U.S. and Argentina. Argentina had a record crop in 2014-15 and 2015-16 will be one of the largest crops. 

Ending stocks of world market is over 2,004m MT is significantly impacting global prices. Price fall was led by U.S. due to its Cost Leadership position.  Chinese peanut prices delinked itself from world price trend, due to short crop in 2014.  Argentina followed suit with a lag but maintained a small premium.  His conclusion was that “Barring extreme weather events in multiple geographies, low prices are here to stay.”  More later.

 

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