Peanuts: Argentina struggles with logistical hurdles
September 27, 2021 at 4:16 PM ,
Der AUDITOR
South America
Argentina is currently reporting very high demand, especially from the EU. According to Driesens, about 50,000 mt would have to be shipped monthly to meet the demand. Problem is the transport situation; many shipments have to be partly cancelled or transferred because there are too few containers or no space on the ships. Added to this are the massive freight costs, which have risen by up to 250%. Decreases are not to be expected here for the time being; on the contrary, sea freight rates for October shipments have risen again for many shipping companies. New offers from Argentina and in some cases also from Brazil now contain a freight clause, which means that the contract price potentially increases or, although unlikely, decreases according to the freight rate.
Another problem is the decline in new plantings in Argentina. According to Driesens and cornhouse.nl, it is expected that these could decrease by 5-20%. The reasons for this are the high rental prices, which were still at USD 900-950/ha last season and have now climbed to USD 1,350/ha, lower profit margins and the fact that better prices can be achieved with alternative crops such as soybeans or corn. In Brazil, however, acreage is expected to remain the same or even increase slightly.
USA
Market players in the USA are very satisfied with the outlook so far. The weather has been very favourable in recent weeks, so good yields and high quality are expected. Demand is also persistently good, which will lead to shortages for some varieties, keeping prices at a high level. Especially the popular Runner peanuts should be able to compete well with the goods from South America this season.
China and India
In China, the crop initially developed well, but adverse weather conditions have meant that yields are likely to be lower than expected and quality could also suffer. This is also reported by cornhouse.nl, referring to a colleague of Driesen's from the Rotterdam Commodity Exchange. A major difficulty is that the peanuts in China are mostly still sun-dried and the sun appeared felt less often than average. The harvesting process, which begins in October in parts of China, could also be delayed by the rain. Frost damage often occurs during harvest time, which affects quality and yield.
In India, the new crop is already arriving on the markets, although here too there are some delays. With the arrival of the new crop, there have been price declines here and market players expect prices to fall further when the steady rains subside. Traders report that demand for peanuts for sowing is currently very low.
|
Peanuts |
|
|
Type, origin |
EUR/kg |
|
Runner, blanched, 38/42, Argentina/Brazil, FCA Spain |
1.45 |
|
Bold, 40/50, non-EU quality, FOB India |
1.32 |
|
Java, 50/60, non-EU quality, FOB India |
1.43 |
|
Trade sources |
|
View more
- price chart, peanuts, with skin, 40/50, Bold, India
- price chart peanuts, with skin, 50/60, Java, India
- more price charts
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