1. Weekly News

Bolivia

Bolivia Expands Peanut Exports to Chile Through New Trade Agreement and Economic Cooperation

Bolivia and Chile have taken steps to expand Bolivian exports to Chile, including products like peanuts, almonds, milk, beef, oregano, avocado, llama meat, Amazonian fruits, almonds, honey, and eggs. In a meeting held in Santa Cruz, Bolivia, officials signed a Memorandum of Understanding (MoU) on Trade Promotion and established a Roadmap for implementing the Electronic Certificate of Origin (CO).

Part of the XIII Meeting of the Administrative Commission of the Economic Complementation Agreement No. 22 (ACE-22), this initiative also addressed market access, sanitary measures, and updated tourism and trade promotion agreements. The agreement outlines tariff preferences and further actions to support Bolivian exports in the Chilean market, aiming to strengthen economic ties and facilitate trade. This meeting marks a significant step toward deeper bilateral cooperation following a 14-year hiatus.

India

India's Peanut Production Expected to Reach Record 10 MMT in 2024/25 Kharif Season

India's peanut production is set to reach a record 10 million metric tons (mmt) for the 2024/25 Kharif season, an increase from 8.2 mmt last year, driven by a strong monsoon. The robust rainfall, 8% above average, has boosted summer-sown crops, with the total foodgrain production projected at 164.7 mmt, a 6% rise from last season. This substantial output increase is expected to help stabilize food prices. Enhanced crop assessment methods, including digital and satellite technology, have contributed to more accurate yield forecasts, aiding market preparedness and reducing price volatility risks.

Pakistan

Pakistan Advances Biopesticide Regulations to Enhance Food Safety in Peanuts and Key Crops

At the 2024 Annual Biological Control Industry Conference (ABIM) in Basel, Switzerland, Pakistan highlighted efforts to regulate biopesticides to address excessive aflatoxins and pesticide residues in crops like peanuts, corn, and peppers. Supported by the Centre for Agricultural Bioscience International (CABI) and funded by PlantwisePlus, the initiative focuses on biopesticide registration guidelines and Integrated Pest Management (IPM) to promote sustainable agriculture. With agriculture representing 24% of Pakistan's' gross domestic product (GDP), these guidelines are expected to reduce dependency on chemical pesticides and boost food safety. Recently approved by Pakistan's Cabinet Committee on Legislation, the guidelines aim to improve crop protection and align with international food safety standards.

2. Weekly Pricing

Weekly Peanut Pricing Important Exporters (USD/kg)

Yearly Change in Peanut Pricing Important Exporters (W45 2023 to W45 2024)

India

India's peanut prices have seen a notable rise, with wholesale prices reaching USD 0.69 per kilogram (kg) in W45, reflecting a 7.81% increase both on a week-on-week (WoW) and month-on-month (MoM) basis. Despite the price increase, India is set to produce a record 10 mmt of peanuts for the 2024/25 Kharif season, up from 8.2 mmt the previous year, driven by a robust monsoon season. This rise in output is forecasted to help stabilize peanut prices.

United States

United States (US) peanut prices dropped to USD 0.58/kg in W45, marking a slight decrease of 1.69% WoW and a significant 25.64% year-on-year (YoY) decline compared to USD 0.78/kg. Mississippi, a key peanut-producing state, is nearing the completion of its 2024 harvest, with 91% of the crop dug and 76% harvested as of late Oct-24. This season saw a 30% increase in planted acreage, reaching 25,500 acres, expected to yield approximately 4,000 pounds (lbs) per acre, similar to last year. While weather conditions have been variable, with some areas facing drought stress, favorable precipitation and irrigation in other regions have supported stable production. The expanded acreage and efficient harvest will likely sustain downward pressure on prices in the short term, mainly if domestic demand does not increase or export opportunities remain limited.

Brazil

Brazil's peanut prices have decreased slightly to USD 3.15/kg in W45, reflecting a 0.32% decrease WoW but showing a 9% increase YoY compared to USD 2.89/kg. Despite the recent price decline, Brazil is on track to achieve a record peanut production for the 2024/25 season, with output expected to reach 832,300 metric tons (mt), a 40.6% increase from the previous harvest. The increased production could exert downward pressure on peanut prices in the medium to long term, primarily if the higher yields result in a supply surplus.

3. Actionable Recommendations

Leverage Trade Agreements for Export Growth

Businesses in the peanut industry should take advantage of the recent MoU between Bolivia and Chile to expand Bolivian peanut exports to the Chilean market. This agreement, which includes tariff preferences and streamlined market access, presents an opportunity for Bolivian peanut producers to strengthen their market presence in Chile. By aligning with the roadmap for electronic CO, companies can reduce trade barriers and improve export efficiency. Exporters should consider building partnerships with Chilean distributors to capitalize on this growing trade relationship.

Mitigate Price Volatility through Diversified Sourcing

In light of India's expected record peanut production and Brazil's increasing peanut output, businesses should diversify their sourcing strategies to stabilize costs and ensure supply continuity. With India's production poised to rise by 1.8 mmt and Brazil expecting a 40.6% increase in production, companies can balance supply from these key markets to manage fluctuations in peanut prices. Additionally, investing in long-term contracts with diverse suppliers can help reduce risks associated with market price volatility and ensure more stable pricing.

Invest in Sustainable Agricultural Practices

Given Pakistan's efforts to regulate biopesticides and improve food safety standards for peanuts, companies involved in the peanut supply chain should invest in sustainable farming practices. Supporting initiatives that reduce pesticide dependency, such as IPM, will align with international safety standards and enhance the quality of peanuts. Businesses can collaborate with producers to promote adopting these practices, ensuring higher-quality crops, reduced aflatoxins, and improved long-term sustainability in the peanut market.

Sources: Tridge, Portal del Campo, News Foodmate