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Peanut market report Crop Season 2020/2021 by Koffi Hippolyte (Raw Commodities trader @ Bush King Commodities - www.bush-king.com).

West Africa's peanut market at a glance

Peanut market in Benin

In Benin, the peanut market is gradually opening up again. The old stocks of 2020 are less available while the new production of 2021 starts to be available. With the installation of the rains in early March in southern Benin and in May in the center and north of the country, the new harvest of fresh peanuts in pods is already noticed on the various markets. More available in the south than in the north, its price remains relatively high. The "Togolo", measure usually used in Benin for purchases from wholesalers (around a kg), is estimated to cost between 250 and 350 FCFA/kg. On the other hand, wholesalers source between 175 and 225 FCFA/Kg from producers for these same fresh peanut pods. As for old stocks of shelled peanuts, the price per kg remains high durin

g the lean season. This old stocks price varies between 700 and 800 FCFA/kg in the south including the political capital "Porto-Novo" and the economic capital "Cotonou". However, in the central and northern regions, the old stock price varies between 650 and 800 FCFA/kg. The lowest prices of these ranges are observed in the peri-urban markets and the high prices in the urban markets of these three regions. In the producing villages, the shelled peanuts are still available and cost between 500 and 550 FCFA/kg and the dried inshell peanut still available cost between 250 and 350 FCFA/kg. The agricultural campaign which has really started at all the agricultural development poles in Benin will look more productive if the forecasts of abundant rains come true.

Peanut market in Côte d’Ivoire

In Côte d'Ivoire, the dry season peanut market in the past season is generally shy as stocks are severely depleted and are in the hands of wholesale stockists in the city. For preparations in the kitchen as a sauce, the old stocks are always used. As for the fresh peanut available and consumed raw in urban areas, it currently comes from the lowlands and should make way for the highland peanuts by mid-July according

to the producers. The rainfall seems normal for the moment even if it is not yet regular in the northern areas while in the South, there is some flooding.With the increase of sowed acreage in peanut and the rains that are starting normal, production is expected to increase compared to the previous season. Prices are stable and sometimes with a decreasing trend in certain areas compared to the previous month. Wholesale prices for shelled peanuts are between 500 and 950 FCFA/kg. The prices of shelled peanuts on the retail markets fluctuate between 600 and 1000 FCFA/kg. The prices of fresh peanuts in shell, which are slowly arriving on urban markets, are between 550 and 650 FCFA/kg depending on the market. The stocks of the past season are becoming scarce and the prices on the markets which were already very high start to decrease due to not only the COVID-19 situation which slowed the exchanges between the zones of production and the big zones of consumption but also to the arrival of the new peanut harvest on the markets. We expect prices to begin falling until full production by July. Therefore, we recommend that wholesalers with large stocks r

elease 75% of these stocks now.

Peanut market in Senegal In Senegal, we attended to a timid start of the rainy season with some light rains in the peanut basin (Kaolack, Kaffrine, Diourbel, Fatick). This is why the vast majority of producers have not yet sown; they wait for the first useful rain to sow their peanuts. The peanut plots are already ready for sowing after good soil preparation. On the other hand, in Casamance, planting of peanuts has started in the three regions (Ziguinchor, Sédhiou and Kolda) following the rains recorded in recent weeks. The level of sowing is good. Regarding the distribution of seeds, the State has already started the subsidized seeds in the main input distribution commissions. The transfer is done without problem.

To date, the majority of producers already have access to subsidized seeds.The prices of subsidized seeds to seed retailers are 325 FCFA/kg with a State subsidy of 175 FCFA/kg, i.e. a producer price of 150 FCFA/kg. The producers' organisations also invested a lot to facilitate access to seeds for their members. In retail markets, the price of shelled peanuts varies between 500 and 600 FCFA/kg. Supply on the markets is fluid despite of the COVID situation. Although much of the peanut has been sold to exporters, the local industry is operating normally; processing failures have not yet been reported.

Peanut market in Mali In Mali, the peanut market was identical to last month. Supply is down due to depletion of stocks and local demand is shy. Most of the exchanges are limited between local buyers who have a little inventory and urban wholesalers or retailers.The prices charged are more or less stable and vary according to the localities.

In Kita, Kolokani and Kayes, the shelled peanut is discussed between 500 and 525 FCFA/kg at the farm-gate level and between 550 and 600 FCFA/kg at the wholesale price. As for the inshell peanut, it is bought from producers at 300 FCFA/kg while at wholesalers' level the price is at 350 FCFA/kg. In Sikasso, prices rose slightly due to the demand for seeds for the new crop season which has just started. Thus, the shelled peanut is sold by producers between 550 and 600 FCFA/kg with 650 to 675 FCFA/kg at wholesale prices. In the case of inshell peanuts, we speak of 350 FCFA/kg at the farm-gate level and 400 FCFA/kg at the wholesaler level. In Bamako, the shelled peanut is bought on the markets between 550 and 675 FCFA/Kg while the inshell peanut is traded b

etween 350 and 425 FCFA/Kg.

Peanut market in Guinea In Guinea, the peanut market is calm and identical to the past month. The supply of shelled peanuts is low as is demand. The noticed exchanges relate to residual quantities, some retention stocks as well as seeds. The actors are no longer focused on marketing but rather on production because the rainy season has effectively taken hold. Plowing and sowing are dominant activities for many producers. However, producers who started sowing very early are in the plot upkeep phase by controlling weeds. Many producers claim to widen their peanut acreage this season because of the market opportunities that peanuts represent.

The seasonal rise in prices is observed in all the markets monitored. Purchase prices at village level are in the range of 8,000 and 9,000 GNF/kg (486 and 546 FCFA/kg) depending on the locality. Wholesale prices are between 9,000 and 9,700 GNF/kg (546 and 589 FCFA/kg).

Peanut market in The Gambia In The Gambia, the 2020/2021 rainy season has started. Rain is falling in parts of the country, particularly in the Centra

l River and Upper River areas. Farmers from URR and CRR distribute their seeds to producers. Due to the government's extension of the state of public emergency for the next 21 days, the weekly "Lumos" markets are still closed. The supply of peanuts to urban markets is becoming scarce. The government price for peanuts in the 2019/2020 season was 18 GMD/kg (204 FCFA/kg) on the farm (seccos)” and 19.5 GMD/kg (221 FCFA/kg) at the depots.

International market In China, the last customs data confirm the very sharp increase in imports of shelled peanuts this year. Between January and April, China imported 412,320 MT of shelled peanuts. The main origins are Senegal (58% of imports) and Sudan (30% of imports). Imports from Ethiopia and India are also on the rise, but much more limited (23,970 MT imported from India between January and April). For the moment, the peanut market in China is calm: domestic supply is weak and transactions are limited. The stocks on the buyer's side are medium to low but the buyers prefer to opt for a waiting strategy, hoping for decreasing prices before doing purchases. The pric

e trend on the Chinese market is stable to slightly decreasing.

In India, the summer harvest in Gujarat is expected around 84,000 MT, a sharp increase compared to last year (60,000 MT in 2020). This increase in production is notably linked to the attractive peanut price compared to that of cotton, for which demand is weak. Summer crop in the other states is also expected to be good. In Gujarat, trade around peanuts has resumed since early May. Current price levels are close to those of late March. Wholesale prices for the G20 variety have been falling for 3 weeks while wholesale prices for the Bold variety have been fairly stable. Wholesale prices at the Rajkot market are around 695 USD/MT for the G20 variety and 755 USD/MT for the Bold variety.

In the United States, demand for peanut butter has increased sharply in recent months: + 31% for the first quarter and + 20% for the month of April. Seed peanut exports are down slightly (106,790 MT exported between early January a

nd late April), with a very strong increase in shipments to China and a drop in shipments to European countries (only 8,925 MT). This sharp drop is linked to the quality issues of the last harvest.

In Argentina, the current harvest is going well. The Argentine peanut chamber recently confirmed the drop in production and export of seed peanuts for this 2019/2020 campaign. In the previous season, 977,760 MT of peanuts had been produced, of which 663,760 MT were available for export. For this 2020/2021 season, peanut production is expected around 884,700 MT and 580,060 MT should be available for exports, equivalent to a decrease of 83,700 MT compared to last year.

In Brazil, production and harvest conditions have been good and exports of peanuts could potentially reach 250,000 MT this year. As a reminder, Brazilian exports of shelled peanuts reached 207,040 MT in 2018 and 196,430 MT in 2019.

At the port of Rotterdam, Netherlands, the average C

IF price for shelled peanuts dropped significantly during the month of May to reach USD 1,473/MT. However, this price remains particularly high, given the start of the campaign and previous campaigns.

Outlooks

Although prices fell in Rotterdam during the month of May, European demand remains strong and the trend of prices on the international market is still considered bullish. In fact, the new Argentine harvest is expected to be lower and US exports to European countries have fallen sharply. The Brazilian and Indian harvests are expected to increase (+ 53,750 MT compared to last year for Brazil) but this increase will apparently not be enough to replace the deficit in American and Argentinian exports to European countries.

As for China, whose shelled peanut imports have increased impressively this year, the market is rather calm for the moment, with prices stable and slightly down. However, stocks are limited and a resumption of domestic demand could reinforce the bullish trend on the international market.

Koffi Hippolyte (Raw Commodities trader @ Bush-King Commodities - www.bush-king.com)

Disclaimer: The information presented in this newsletter is collected from many economic actors and cannot claim to be perfectly representative of all that occurs on an agricultural market. The opinions and statements published in this newsletter are the sole responsibility of the authors and are shared for informational purposes only.

Peanut market report Crop Season 2020 :2021

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