Peanut Prices Seen Sliding on Record Crop in Argentina
(Corrects to prices from output in headline.)
Peanut prices are forecast to fall in the second half of the year as a record crop in Argentina eases a supply shortage, Oil World said.
Prices for peanuts, or groundnuts, in Rotterdam may fall to about $1,800 a metric ton on the basis of cost, insurance and freight from $2,800 now, the Hamburg-based oilseed researcher said today in a report.
U.S. prices for peanuts, used in Unilever’s Skippy peanut butter and Mars Inc.’s Snickers bars, gained 54 percent in the past 12 months to 34.6 cents per pound in the week ended April 27, government data show. Drought reduced the crop in the U.S. and Senegal, an exporter of groundnuts.
“The groundnut market will soon be in transition from a severe shortage to relatively comfortable new-crop supplies,” Oil World wrote. “Support still comes from the shortage of high-quality groundnuts on the U.S. market.”
U.S. creamy peanut butter retail prices fell less than 1 percent to $2.738 a pound in March from a record $2.754 in February, the first drop in nine months, according to the U.S. Bureau of Labor Statistics. The cost of peanut butter was up 37 percent from a year earlier.
“In April, groundnut prices received by U.S. farmers rallied to an all-time high of 35 cents per pound,” Oil World wrote. That is “providing incentive for a pronounced expansion of plantings this year,” the researcher said.
U.S. farmers may boost planting by 25 percent to 575,000 hectares (1.42 million acres), Oil World said.
Argentina’s peanut production in the year through March 2013 is forecast to jump to 870,000 tons from 736,000 tons in 2011-12, as plantings climb to 340,000 hectares from 283,000 hectares, Oil World forecast.
“Prices of groundnuts are likely to ease and fall below the highs seen in recent months once marketing of this year’s large Argentine crop gains momentum,” Oil World said.
World peanut stocks are forecast to slip to 1.06 million tons at the end of 2011-12 from 1.29 million tons 12 months earlier, as use outpaces production for a third year.
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