Dr. Nathan Smith had this to say about the market situation for peanuts.
The large crop projected on the August 10 could actually be larger. USDA projects a 2.65 million ton crop but if total of 1.6 million acres is figured with the record yield projection of 3,562 lb per then the total peanut production is closer to 2.78 million tons adjusting for a normal abandonment rate. Below are scenarios accounting for the FSA reported acreage and different yields.
|USDA||3562 lb Yield||3600 lb Yield||3500 lb Yield||3400 lb Yield|
|2010/11||2011/12||2012/13||1.6 mil acres||1.6 mil Acres||1.6 mil Acres||1.6 mil Acres|
Supplies will be up 70% to 80% over last year depending on the size of the crop. This doesn’t bode well for prices. Asking price for shelled peanuts is around 55 cents/lb. Farmer stock prices when shelled prices are in the 50s have ranged between $390 and $500 per ton, typically closer to $400 per ton.