1. Weekly News

Ghana

Drought in Northern Ghana Threatens Peanut Production and Food Security

The recent drought in Northern Ghana has significantly impacted peanut production, raising concerns about crop failure and food security in the region, which relies on a single rainy season from April to October. Farmers, particularly in the Savannah, Northern, and Upper East Regions, report drastic yield reductions, with some experiencing a drop from 20 bags (50-kilogram bags) to just one or two bags due to the lack of rainfall.

Local farmers are struggling, with crops failing to germinate or yielding poorly after limited rain since early Jun-24. The government is urged to implement immediate emergency food aid to prevent hunger and to distribute seeds and fertilizers to support replanting efforts.

In the medium term, promoting drought-tolerant crops and implementing soil conservation techniques are recommended. Additionally, to enhance resilience against future droughts, irrigation support, and climate-smart agricultural practices should be adopted. An agrarian insurance scheme is also suggested to protect farmers from crop failures. These measures are essential to ensure food security and support the recovery of the agricultural sector in northern Ghana.

United States

Florida's Peanut Farmers Endure Growing Hurricane Damage and Costs

Peanut farmers in Florida face unprecedented challenges this harvest season due to increasingly severe hurricanes and rising operational costs. In Sep-24, Hurricane Helene hit North Florida with 6 to 10 inches of rain, marking the third major storm to impact the region in just over a year, following Hurricanes Idalia (Aug-23) and Debby (Aug-24). These storms have inflicted between USD 113 million and USD 147 million in agricultural losses statewide, severely affecting peanut crops.

The hurricanes' strong winds and rains are particularly damaging to peanuts, which require careful harvest timing to prevent spoilage. Flooded soils trap peanuts underground, leading to rot, fungal growth, and aflatoxin contamination, rendering crops unmarketable. Farmers reported extensive delays, yield losses, and infrastructure damage, compounded by costly transport needs to processing facilities as local storage points were damaged.

As peanuts are Florida's third-largest crop, their future remains uncertain. Though government assistance programs exist, delays in accessing these funds further strain farmers' resilience, which is stretched by low market rates, high input costs, and ongoing climate pressures. Experts express concern that without timely support, the region's agricultural viability and the mental health of its farming communities may be severely jeopardized.

Drought and Heat Challenge Expanded Peanut Acreage in Texas and Oklahoma

Texas and Oklahoma peanut farmers increased their 2024 plantings, with Texas adding 14 thousand acres for a total of 236 thousand acres and Oklahoma adding 1.10 thousand acres, a total of 17.10 thousand acres. Despite a promising early season, extreme heat and drought have severely impacted yields as irrigation struggles to meet water demand. Oklahoma faces its third consecutive drought year, while Texas reports increased acreage abandonment due to water shortages, rising from 1.8 thousand to 3.8 thousand failed acres by Sep-24.

Though hot, dry conditions helped limit disease pressure, weed control varied due to inconsistent rain. To address ongoing water challenges, Texas producers are shifting towards drought-tolerant Spanish peanut varieties, now comprising nearly half the state's peanut acreage.

Texas Panhandle Peanut Farmers Try Calcium in Irrigation to Conserve Ogallala Aquifer Amid Drought

Peanut growers in the Texas Panhandle are testing a calcium product in irrigation pivots to reduce water use, aiming to conserve the Ogallala Aquifer amid ongoing drought. The calcium addition enhances water efficiency during the peanut pegging phase, allowing farmers to irrigate less frequently. The region, where peanut cultivation has a 50-year history, finds peanuts beneficial as a rotation crop with cotton due to their soil-enriching properties. With 14 thousand additional peanut acres planted in Texas this year, the focus remains on sustainable water practices as harvest gets underway in Armstrong and Donley counties.

2. Weekly Pricing

Weekly Peanut Pricing Important Exporters (USD/kg)

Yearly Change in Peanut Pricing Important Exporters (W40 2023 to W40 2024)

India

India's peanut prices decreased to USD 0.60/kg in W40, marking a 1.59% week-on-week (WoW) decrease from USD 0.63/kg in W39 and a further drop of 21.52% year-on-year (YoY) from USD 0.79/kg in W40 2023. As of W40, India's peanut harvest is underway, with expectations of peak arrivals past mid-Oct-24. However, recent rainfall may downgrade early harvest materials to crushing quality, impacting overall quality and market dynamics. Daily arrivals of over 200 thousand bags of in-shell peanuts are anticipated in Gujarat. However, initial yield forecasts of 3.5 million metric tons (mmt) are being revised down to approximately 2.5 mmt due to unfavorable weather conditions. Nationally, while production was expected to reach around 5 mmt, current estimates suggest a more realistic figure of 3.4 to 3.6 mmt.

As the harvest progresses, peanut prices are projected to decline in the short term due to increased supply. However, several factors could influence future pricing dynamics. First, the demand for peanut oil in China is forecasted to remain subdued, which may limit upward pressure on prices. Second, the Indian government's procurement strategy will play a significant role. Last year, government purchases were made at below-market prices of USD 10 to 12 per metric ton (mt). However, procurement is anticipated to commence at higher prices this year after the Diwali festival in Nov-24.

United States

In W40, US peanut prices declined to USD 0.53/kg, marking a 10.17% WoW drop and a 3.75% MoM increase from USD 3.20/kg. This decrease reflects worsening crop prospects in Texas due to prolonged drought conditions, with record-high temperatures and limited rain severely impacting yields. Producers in the Texas Rolling Plains report that high temperatures, especially in Aug-24, have led to poor pod development, particularly in non-irrigated areas. Despite early-season rainfall, extreme heat, and drought stress in late summer reduced moisture levels, limiting pod formation and causing crop losses in both irrigated and dryland peanuts. Although the drought has minimized insect and weed pressure, irrigation challenges due to low aquifer levels have further constrained peanut output. This climate-driven reduction in yields may exert upward pressure on prices in the long term if supply remains low, although recent price decreases suggest recent oversupply in certain markets.

Brazil

Brazil's average peanut prices decreased to USD 3.32/kg in W40, an 8.54% WoW drop from USD 3.63/kg in W39. As of W40, Brazil's peanut market has an oversupply of peanuts that don't meet European Union (EU) standards, while the availability of peanuts that meet EU quality standards is limited. This disparity creates downward pressure on prices, particularly as the 2024 crop is forecasted to be substantial. Given the considerable size of this crop, a decline in peanut prices is forecasted for the latter half of 2025. However, ongoing drought conditions affecting Brazil and Argentina during the planting of the 2025 crop introduce uncertainty regarding this price decline, which, if it occurs, is expected to be gradual. Moreover, the export demand for peanut oil remains weak, further complicating the pricing outlook. The lack of additional supply from the 2024 crop for the EU market contributes to the uncertainty. EU buyers may seek alternative sources or adjust their purchasing strategies based on quality and availability.

3. Actionable Recommendations

Adopt Sustainable Sourcing Practices

Consumers increasingly prioritize sustainability, prompting importers to seek peanuts from producers that adhere to environmentally friendly practices. Engaging with suppliers in Brazil and India who are committed to sustainable farming can enhance brand reputation and meet growing consumer demand for ethically sourced products. Certifications, such as those from sustainability standards, can provide transparency and credibility to sourcing practices.

Invest in Market Intelligence and Forecasting

Stakeholders, including exporters and importers, should invest in market intelligence and forecasting to navigate the complexities of the peanut market. By collaborating with agricultural cooperatives and market research firms, they can gain insights into production forecasts, weather patterns, and pricing trends, allowing for informed decision-making and timely adjustments to procurement strategies.

Engage in Value-Added Processing

Peanut processors and exporters should explore opportunities for value-added processing, such as producing peanut oil and specialty products. This approach can help stabilize revenue streams amid fluctuating peanut prices while catering to diverse consumer preferences. By expanding product lines, stakeholders can tap into new markets and enhance profitability.

Sources: WUFT, Farm Progress, ABC 7 News, Joy Online