Chinese will have to Buy Lots of US Peanuts to Make Dent in Supply
There’s been some information floating around the past couple of days that the Chinese are importing American peanuts as fast as they can unload the boats, giving growers hope that a significant dent will be made in peanut stock piles, resulting in good prices for 2013. NC Peanut Growers Association CEO Bob Sutter says not so fast:
“We had a huge crop in 2012. The southeast had a monster of a crop on 20-25% increased acres, so they produced a huge amount of peanuts. We have about 70% of the peanuts that will be needed in 2013 already made. So we have to get rid of a lot of peanuts and it will take a lot of slow boats to China to unload all of them. But it is a wonderful development for peanuts to be being exported in to China. It is a good development but I don’t think it will cause a huge upward pressure on contract prices in the next two months.”
Speaking of contracts, Sutter says there’s at least one offer out there already that he knows of:
“One company is out with at $545 contract for 2013. Those acres will be somewhat limited based on what you planted last year, but that one contract is out there.”
Exporting product aside, Sutter explains what needs to happen to bring peanut production back in line with prices that will make producers happy:
“We need to get production in line with supply, that’s the same with any commodity, cotton, corn or soybeans. You need to have your production in line with what the market will take.”
Bob Sutter, CEO of North Carolina Peanut Growers Association.