What is in this article?:
- Peanut growers face major price pressure
- Exports helping with surplus
• Call it a major league problem, or the world series of carryovers — massive peanut supplies have the pipeline clogged for months to come.
Some farmers are hoping the new baseball season has every fan waving to the peanut vender.
But it will take a lot more than a 162-game schedule to get rid of about 1 million tons of surplus peanuts still in storage. Call it a major league problem, or the world series of carryovers — massive peanut supplies have the peanut pipeline clogged for months to come, said Tyron Spearman, Tifton, Ga., peanut prognosticator.
Spearman, editor of The Peanut Market News, spoke recently at the Oklahoma Peanut Expo in Lone Wolf, Okla. He cited the explosive 2012 U.S. production as reason behind the glut of peanuts that is likely to keep prices down for farmers.
"Farmers (setting on peanuts in storage) will face about a $385 per ton price if none has been contracted," Spearman said, after reviewing reasons behind huge peanut supplies. "We had one fantastic production year," he said.
"All the stars lined up and we produced the finest crop of peanuts the world has ever seen in America. While we normally produce about 1.8 million tons, we produced 3.37 million tons, about 85 percent more.
“The major problem is how to get rid of those peanuts."
A peanut shortage leading up to the 2012 crop had prices high, with some markets approaching $1,000 per ton, Spearman said. Others hit $650 and more settled at $600.
As often happens, with high prices came increased planted acres. They surged to 1.6 million, about 44 percent over normal. Increased acres, plus excellent seed varieties and a perfect growing season, caused the production surge and sent prices tumbling.
"The average yield was 4,192 pounds per acre, a 26 percent increase," Spearman said, adding that Oklahoma production increased more than 30 percent per acre.
Total domestic and world peanut use is projected at about 2.6 million tons this year. But with about 3.87 million tons worldwide, that leaves about 1 million tons that must be worked through.