1. Weekly News

India

Higher Yields and Expanded Area Boost Gujarat's Peanut Production by 26% YoY in 2024

According to the Solvent Extractors Association (SEA) Groundnut Promotion Council of India, Gujarat's peanut production increased by 26% year-on-year (YoY) in 2024, rising from 3.34 million metric tons (mmt) last year to 4.21 mmt, despite challenging weather conditions. The key contributing districts were in the Saurashtra region, with Dwarka and Rajkot leading in yield. The increase is due to higher productivity, with yields rising to 2,210 kilograms (kg) per hectare (ha) from 2,045 kg/ha, along with an expansion in cultivation area by 275 thousand ha, totaling 19.09 million ha.

Peanut Seed Shortage Threatens Livelihoods of Farmers in Kendrapara and Jajpur Districts Ahead of Sowing Season

Farmers in Kendrapara and Jajpur districts face a critical shortage of peanut seeds ahead of the sowing season, jeopardizing their livelihoods. The agricultural department plans to distribute certified and subsidized seeds at USD 77.29 per quintal (INR 6,500 /quintal), sourced from the Seed Corporation of Odisha (SCO). However, delays in receiving the seeds are causing concern. Farmers struggle to afford seeds from the open market, where prices have risen to USD 83.23 to 95.12/quintal (INR 7,000 to 8,000/quintal), forcing many to buy substandard seeds, potentially harming crop yields. Around 50 thousand farmers cultivating 80 thousand acres of riverside land are affected.

United States

Texas Peanut Acreage Expands in 2024 Following Market Price Surge and Weather Challenges

Texas peanut producers increased their planted acreage in 2024 to 236 thousand acres, up from 222 thousand acres in 2023, following two consecutive drought years. This increase was driven by higher market prices, especially for Spanish peanuts, which now account for 46% of the state's peanut acreage. The second-largest peanut-producing state, Texas saw mixed growing conditions, with drought and hot weather potentially limiting yields despite early moisture.

Hurricane damage in key peanut-producing regions along the United States (US) East Coast could reduce national supplies, leading to higher peanut prices in 2025. The United States Department of Agriculture (USDA) forecasts for the 2023/24 season estimate average prices at USD 538 per metric ton (mt), potentially increasing next season depending on final yields and demand.

2. Weekly Pricing

Weekly Peanut Pricing Important Exporters (USD/kg)

Yearly Change in Peanut Pricing Important Exporters (W42 2023 to W42 2024)

India

India's peanut prices increased to USD 0.64/kg in W42, reflecting a 1.59% week-on-week (WoW) increase but a 20.99% YoY decline from USD 0.81/kg. The price rise follows a 26% increase in Gujarat's peanut production for 2024, reaching 4.21 mmt due to improved yields and expanded cultivation. If supply continues to outpace demand, this could stabilize or lower prices. However, farmers in Kendrapara and Jajpur districts face a critical seed shortage before the sowing season. This situation may adversely affect future crop yields, complicating market dynamics.

United States

In W42, US peanut prices rose to USD 0.59/kg, a 1.72% increase from the previous week and a 6.35% YoY rise, primarily driven by crop damage from recent hurricanes. Hurricanes Helene and Milton devastated key peanut-growing regions, particularly in Georgia, where 30% of the peanut crop was destroyed. Hurricane Helene, a Category 4 storm, impacted multiple states with severe flooding and high winds, causing extensive losses to peanut, cotton, and pecan crops. Hurricane Milton, a Category 3 storm, compounded the damage, leaving Florida still assessing crop and property impacts. With widespread agricultural losses, US peanut prices may continue to face upward pressure as recovery efforts unfold.

Brazil

In W42, Brazil's peanut prices slightly decreased to USD 3.32/kg, reflecting a 0.90% WoW decline and an 8.54% month-on-month (MoM) decrease compared to USD 3.63/kg in W39. This decline is influenced by the Brazilian real (BRL) devaluation, which affects local pricing dynamics. In addition, projected extreme weather events in 2024, such as severe drought and rising temperatures, may further disrupt agricultural activities, including peanut planting. These factors could lead to potential fluctuations in peanut supply and prices in the upcoming months, impacting market stability.

3. Actionable Recommendations

Enhance Seed Distribution Mechanisms

To address the critical seed shortage faced by farmers in Kendrapara and Jajpur districts, stakeholders should streamline seed distribution channels. The agricultural department should establish timely communication with SCO to ensure prompt delivery of certified and subsidized peanut seeds. Developing partnerships with local cooperatives could facilitate more efficient distribution and support farmers in accessing quality seeds. Implementing a direct-to-farmer model could also reduce reliance on open market purchases, ensuring farmers receive the necessary inputs at a fair price.

Support Farmers with Financial Assistance Programs

Given the rising costs of peanut seeds in the open market, stakeholders should advocate for financial assistance programs to support farmers' purchasing power. These could include low-interest loans or subsidies specifically targeted at acquiring quality seeds and other essential inputs. Providing farmers access to financial literacy resources can also empower them to make informed decisions and manage their budgets effectively, reducing their dependence on substandard seeds and improving overall crop yields.

Sources: Tridge, AgriLife Today, India Express, Times of India, Oils & Fats International Magazine (OFI)