W5 Peanut Update: Production Decline in India Raises Supply Chain Concerns

Heavy Rains and Reduced Cultivation Area Threaten India's Peanut Production

India's peanut production is under threat due to heavy rainfall and a reduced cultivation area. The production decline in Tamil Nadu, Andhra Pradesh, and Karnataka has raised concerns about the nationwide peanut supply chain. The Tamil Nadu Agriculture's Center for Agricultural and Rural Development (TN-IAM) predicts peanut prices will range from USD 0.96 to USD 1.02 per kilogram (kg). The peanut inflow from Telangana, Andhra Pradesh, and Karnataka is limited due to the relentless rains in the producing states. The reduction in cultivation and rain-induced damages may result in a rise in peanut prices. Consequently, exporters must closely monitor potential fluctuations in peanut prices.

India Plans to Boost Local Oilseed Production to Reduce Reliance on Imported Vegetable Oil

India plans to reduce its reliance on imported vegetable oil by boosting local oilseed production, including peanuts, rapeseed, sesame, soybean, and sunflower. In 2023, the country imported edible oil worth USD 20.8 billion. The Finance Minister of India has announced a comprehensive strategy to improve local production, including research into high-yield varieties, modern farming techniques, market linkages, guaranteed procurement, value addition, and crop insurance.