Peanut Market News – Jan. 28, 2016

ABUNDANCE OF PEANUTS IN 2016

After a 22% increase in acreage last year and a good growing season, the peanut industry has an abundance of cheap peanuts with a carry-forward of over 1,429,000 tons going into 2016. Farmers forfeited over 172,000 tons of peanuts in 2014 to the government last year which forces Commodity Credit Corporation to sell to an already flooded market.  Over 20,000 tons of 2014 peanuts remain in inventory today. 

Government costs continue to rise, some charging that the reference price is set high, others believe the cut in the cotton program that switched cotton base to generic and later peanut base (that must be planted) is increasing the program costs.  The Congressional Research Department estimated a $446 million cost for 2015, not counting additional costs associated with marketing loan sales, including storage and handling costs. 

 

CONTRACTS

Contracts for growing runner type peanuts are only $375 per ton this season.  No early mention about Virginias or Spanish.  Farmers have been warned that agreements with buying points/shellers providing USDA approved peanut storage is required to receive a $355 per ton marketing loan.  Some farmers are asking about avoiding market gains if USDA lowers the repayment rate to move peanuts out of surplus.  Many farmers are asking about commodity certificates for peanuts and how the new idea will be handled by USDA.  Seed prices are expected to be slightly higher than last year due to some weather damage at harvest. Some shellers are offering a $25 per ton seed premium to add to the contract offers.

 

JOE CAMPBELL ANNOUNCES RETIREMENT

After more than 35 years in the peanut business, Joe Campbell, Golden Peanut vice president of procurement, is retiring.  Joe began his peanut career with Camilla Cotton Oil in 1975.  In 1981, Joe’s employer was purchased by Alimenta, where Joe went on to help dramatically expand the company’s footprint in peanut procurement.  Joe became an employee of Golden Peanut in 1989, when Alimenta became a partner-owner of Golden. 

For the next twenty-six years, Joe progressively gained additional responsibility over all aspect of Golden’s commercial procurement efforts.  After initially serving as director of procurement for the southeast, Joe’s role grew to also include the Virginia-Carolina region.  Eventually, as national director of procurement, Joe had responsibility for all regions including the southwest.  In 2011 Joe was promoted to vice president of procurement, where he has managed all aspects of commercial procurement and seed.

Among Joe’s most notable accomplishments has been the creation and development of Golden Peanut’s extensive buying network, which consists of company-owned and commissioned buying points.  Joe has also overseen Golden’s efforts in developing effective farmer-stock contracting methods, as well as helping the Company achieve repeated success through its seed business.  Joe’s official retirement date was January 15th, 2016; however, he will continue to serve as an advisor to Golden Peanut in the days ahead.    

 

 

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