Peanut Farmers Wrap Up Harvest as Global Oversupply Continues
Peanut farmers across the U.S. are finishing harvest, working to get the last of the peanuts in before cold weather arrives. Domestic demand remains steady, but all eyes are on the global export market, where oversupply continues to shape prices and future planting decisions.
As one broker explained, “the peanut oversupply… seems to be here to stay for a few more months.” This lingering imbalance is rooted in strong production across the northern hemisphere. The broker added, “The crops in the northern hemisphere are progressing well, that’s mainly the U.S. area, and they may end up with quality issues, but they seem to promise plenty in terms of volume. It’s a big crop.”
Argentina and Brazil Plan Sharp Reductions in Planted Acres
While the U.S. deals with heavy supplies, peanut-producing competitors in the southern hemisphere are preparing for corrective action. The broker noted, “Down south in our competitors Argentina and Brazil seem to have taken notice that a sharp reduction in planting this year is needed to balance the table as a 20 to 25 percent decrease they propose in both countries.”
This move, if realized, could help rebalance the global market. “That’s a move that will be helpful in reducing that oversupply and will also help in the pricing as well,” the broker said.
Despite the planned acreage cuts, shipments from South American exporters remain brisk. “On a daily basis, Argentina and Brazil are seeing shipments of their kernels moving at a high speed right now, showing that we do not have a demand shortage as we have talked about in the U.S.”
Prices Under Heavy Pressure as Oversupply Persists
Large supplies combined with financial and logistical challenges have pressured prices significantly: “The oversupply, combined with logical and also financial bottlenecks, has pushed prices down even below the cost of production.”
For U.S. growers, this environment adds stress heading into the new marketing year.
China’s Influence Expected to Grow
China remains a key global buyer and may help absorb some of the excess supply. As the broker summarized, “China is playing a key role here in the implementing some excellent lower quality grades and they hope they’ll buy more.”
With international demand still active and production adjustments underway abroad, the coming months will be critical in determining whether the peanut market can regain balance.
Audio Reporting by Tyron Spearman for Southeast AgNet.