The INC attended both the Peanut Supply and demand Panels for The Americas and Asia, where the supply and demand state of affairs was discussed for each region. South and Central America.
Peanut Supply and Demand Panel – The Americas
Representatives of South, Central and North America peanut industry discussed on current production and expectations for the incoming season year-to-date, domestic and international demand for American origins as well as quality and regulations. The panel was moderated by Ryan Lepicier (Senior, Vice President & Chief Marketing Officer, National Peanut Board) and the speakers were:
- Edoardo Fracanzani (Executive Director of the Argentina Peanut Chamber, Argentina)
- Robson Fonseca (Foreign Trade Manager, Coplana, Brazil)
- Joaquin Zavala (General Manager, Comasa, Nicaragua)
- Bob Parker (President & CEO, National Peanut Board, USA)
Argentina most recent survey among producers estimates a 2020/2021 yield of 2.36 metric tons per hectare (kernel basis, around 3.37 in-shell basis), lower than last year, which was a particularly good season with a very high yield (2.78 MT/ha kernel basis), but still an average yield for Argentina. With 386,000 ha planted, and the harvesting operation just starting for the shorter cycle varieties, a production of around 1.3 million MT in-shell basis/910,000 MT kernel basis is anticipated. Quality is expected to be fairly good.
In Brazil, in spite of having started planting later –planting took place during November at December, while it usually starts in October– 2020/21 planted area planted area was increased by 5-6% from the previous season and it amounted to 240,000 ha. This trend is expected to continue in the next 3 years. Brazil has already harvested 95% of its peanut crop; and while weather was good during December and January, droughts from February onwards, have impacted big calibers and quality for the remaining harvest. However, 70% of the early harvest was of very good quality, meeting EU standards.
The next growing season in Nicaragua will start around mid-June and both planted area and production are expected to be similar to 2020. For the US, the National Peanut Board expects planted area this year to be at least the same as last year, or even slightly higher.
Growers’ decision regarding planting peanuts or other competing crops, such as cotton or corn in the US; sugar cane or soybean in Brazil, sugar cane in Nicaragua or grains in Argentina, are affected by different variables in each origin. While planting intentions in the US, Brazil and Nicaragua seem to be mostly related to competing crop prices, in Argentina, where planted areas are steady in general, planting intentions might be more affected by the taxes rates applied to agricultural commodity exports.
As for demand, Argentina, Brazil and Nicaragua are focused mainly on exports markets. Although production is three time bigger than local consumption, domestic demand in Brazil is growing year o year; 2020 has seen a big increase due to the pandemic-induced consumer behavior. Main markets for Nicaraguan edible peanuts are currently the EU and Mexico, Central America is a mature market and oil is mainly exported to China.
The year 2020 has also set a record for peanut consumption in the US. For the current marketing year, ending in July 31, there was already an increase of 2.9%, which is significant considering the US is a very mature market. Product innovation has surely been a huge driver for peanut local consumption. In terms of international demand, Canada and Mexico are strong markets, as there are no tariffs limitations and China is still a very solid buyer of US peanuts.
In Brazil, in spite of having started planting later –planting took place during November at December, while it usually starts in October– 2020/21 planted area planted area was increased by 5-6% from the previous season and it amounted to 240,000 ha. This trend is expected to continue in the next 3 years. Brazil has already harvested 95% of its peanut crop; and while weather was good during December and January, droughts from February onwards, have impacted big calibers and quality for the remaining harvest. However, 70% of the early harvest was of very good quality, meeting EU standards.
The next growing season in Nicaragua will start around mid-June and both planted area and production are expected to be similar to 2020. For the US, the National Peanut Board expects planted area this year to be at least the same as last year, or even slightly higher.
Growers’ decision regarding planting peanuts or other competing crops, such as cotton or corn in the US; sugar cane or soybean in Brazil, sugar cane in Nicaragua or grains in Argentina, are affected by different variables in each origin. While planting intentions in the US, Brazil and Nicaragua seem to be mostly related to competing crop prices, in Argentina, where planted areas are steady in general, planting intentions might be more affected by the taxes rates applied to agricultural commodity exports.
As for demand, Argentina, Brazil and Nicaragua are focused mainly on exports markets. Although production is three time bigger than local consumption, domestic demand in Brazil is growing year o year; 2020 has seen a big increase due to the pandemic-induced consumer behavior. Main markets for Nicaraguan edible peanuts are currently the EU and Mexico, Central America is a mature market and oil is mainly exported to China.
The year 2020 has also set a record for peanut consumption in the US. For the current marketing year, ending in July 31, there was already an increase of 2.9%, which is significant considering the US is a very mature market. Product innovation has surely been a huge driver for peanut local consumption. In terms of international demand, Canada and Mexico are strong markets, as there are no tariffs limitations and China is still a very solid buyer of US peanuts.
Peanut Supply and Demand Panel – Asia
Representatives of the Chinese and Indian peanut industry recapped on 2020 observed trends on supply, exports and demand, and discussed on expectations for 2021. The panel was moderated by Jason Chen (Senior Sourcing Manager, Asia Nuts Mars Wrigley, China) and the speakers were:
- Charlie Jia (Chairman, Qingdao Foodlink Co Ltd., China)
- Kobe He (Business Manager, Sinopharm Group, China)
- Kishore Tanna (Indian Oilseeds & Produce Export Promotion Council (IOPEPC), India)
- Khushwant Jain (Chairman, Indian Oilseeds & Produce Export Promotion Council (IOPEPC), India).
On the supply side, is still early to anticipate the planted area in China (planting starts in late April-early May). However, two approaches were discussed: i) considering that last year wheat and corn prices increased by over 40%, peanut planted area might be slightly reduced in favor of the cereal, as peanut is a commonly rotated with these two crops. ii) On the other hand, due to the increased domestic demand seen last year, high prices (the highest over the last 5 years), along with local policies supporting peanut planting, sowing area is expected to increased compared to last year. In India, this year’s planting is expected to be at least similar to the previous season, or even higher, as peanut production areas has recently expanded to two new provinces. Prices are good and the crop forecast is looking promising.
Regarding exports, Indian international shipments last year amounted to around 679,000 metric tons of raw peanuts, and a similar volume is expected to be reached this year. The biggest market remains oil, but peanut paste, blanched peanuts and domestic markets are also increasing. China expects the European market to remain stable throughout 2021.
Finally, domestic demand for peanut oil in China has increased significantly as a result of COVID19 restrictions, particularly in major cities. In India, however, the pandemic had a significant impact on the HORECA sector, with demand falling by 40% and not being offset by household demand.
Regarding exports, Indian international shipments last year amounted to around 679,000 metric tons of raw peanuts, and a similar volume is expected to be reached this year. The biggest market remains oil, but peanut paste, blanched peanuts and domestic markets are also increasing. China expects the European market to remain stable throughout 2021.
Finally, domestic demand for peanut oil in China has increased significantly as a result of COVID19 restrictions, particularly in major cities. In India, however, the pandemic had a significant impact on the HORECA sector, with demand falling by 40% and not being offset by household demand.