Saturday, April 13, 2024

Extended Outlook

With production matching demand and little competition for acres, peanut planting is expected to be about the same in 2024.


Before looking ahead to 2024’s economic outlook, it is helpful to take a look at what happened in 2023 with regard to acreage, yield and overall production.

Overall, the U.S. planted peanut acres in 2023 were 15% higher than the previous year, which had been expected after a two-year decline. In a breakdown of acreage by area, Peanut Growers Cooperative Marketing Association manager Dell Cotton says the Virginia-Carolina area had the highest planted acres since 2017.

“That was a big year for us. We had a lot of peanuts planted, and we made a heck of a crop, so 2017 is a pretty good reference point,” he says. “This was our highest acreage in the V-C since then, mostly due to a 6% increase in planted acres in North Carolina. Acreage was also increased in South Carolina, with Virginia remaining about the same.”

Planted Acres Increased

In the Southeast, acreage was up 10%, led by Georgia’s 13% increase up to 769,000 acres. Cotton says other Southeast states were average, except Mississippi, which has been on the decline since 2017. “They went from about 42,000 acres in 2017 to about 17,000 acres this year,” he says.

Unfortunately, for the second year in a row, the Southwest had extremely dry weather.

“In Texas, there’s about a 40,000-acre difference between the number certified before the season and the actual acres harvested in the state,” Cotton says.

Grouped into the Southwest, Arkansas has become a fairly significant growing area with about 12% of the acres for that region. As well, Missouri has almost the same planted acreage now as Virginia.

Average Yield Dips To Seven-Year Low

Yields were affected by dry weather conditions in many areas of the Peanut Belt. In the Southeast, there were pockets of drought, some of which recovered fairly well.

“The Southeast’s yields were about 6% below last year and below average,” Cotton says. “In October, Georgia was predicted to average 4,300 pounds to the acre, but they fell short of that number by 230 pounds per acre.

“In the Southwest, for the second year in a row and three out of four years, the average has been below 3,000 pounds per acre for Texas. That is a fairly low yield when you consider a state average, but that’s what happens when you have the extent of dry weather and no rain that they have had the past few years.”

The bright spot in the Southwest is just over the state line into Arkansas, which had a tremendous average yield of more than 5,800 pounds to the acre. This is the second year in a row producers have yielded more than 5,000 pounds to the acre on their peanuts.

“In the V-C,” Cotton says, “this was the third year in a row that all three states averaged over 4,000 pounds per acre. In fact, U.S. Department of Agriculture’s National Agricultural Statistics Service says this could be an all-time record yield in Virginia. While the numbers are not finalized yet, it will be in the 4,800-pound range.”

Overall, the U.S. average yield is 3,668 pounds per acre and is the lowest since 2016. The average yield had been forecast at 3,900 pounds per acre in October, so the crop did not come in as well at harvest as was expected at one time.

Production Close To Demand

Overall, the total U.S. crop will be very close to the U.S. demand at 3 million tons. That includes domestic and export demand and represents an 8% increase over last year’s production.

Runner production increased by 6% over last year. Both Spanish and Valencia types had an increase in production in 2023, but Virginia-type peanuts declined slightly.

Cotton says the origination of Virginia-type peanuts is returning to the V-C area. “In 2023, 85% of the Virginia’s were produced in the V-C area. Prior to that, 80% were produced in the V-C and before that 77%. The difference is the amount of Virginia peanuts produced in the Southwest where a significant quantity was produced three to four years ago, so these past couple years because of weather, they didn’t make as many as they had been.

“We are stuck on that 1 million tons carryover, and we had a 3-million-ton crop, which is pretty much what demand is, so everything is pretty much staying the same,” he said.

“On the export side, January through October, exports are up 14%. The top three markets are Mexico, Canada and China.” Cotton says it is a little unusual for China to be buying now because usually they are big players in years with significant quality issues.

“That’s what they want to buy. They want to buy them cheap. With the past two crops being higher quality and this crop that still fairly good quality, it’s good to see they are buying some decent peanuts,” he says.

Crop Input Costs

Clemson University Extension economist Nathan Smith works with a team of researchers to prepare crop budgets for producers to use in their planning. For 2024 budgets, he says they left seed and chemical prices about the same as the previous year. However, one item of good news Smith points out, when comparing this year to last year, is that diesel is down in price a little over 17%. Fertilizer prices are also down, but those had been coming down for much of last year.

“Nitrogen is down somewhere between 25% to 30% when comparing this time last year to now,” Smith says. “But when I say it came down from last year, it actually was coming down since about February last year. So, you had likely already realized that, but it has only recently been changed in our budgets for 2024.

“DAP had been increasing in the last half of 2023. Urea came up from its low last year and is still around 60 cents per pound for nitrogen. Potash has been in the $5.15 to $5.20 range,” he says.

Even though some prices are down, Smith says fertilizer costs are still well above what they were three to four years ago.

No Big Acreage Shift Expected

In looking at yields, Smith says South Carolina farmers averaged a little over 4,000 pounds per acre in 2023.

“So that’s three years in a row of a little better than two tons of peanuts per acre for a state average,” he says.

As for other crops, and despite a probable record yield in soybeans in 2023 at 39 bushels per acre, what does that mean for crop acres in 2024?

Smith says, “There’s nothing really calling for a change in acres, and we want to maintain our rotations. There will probably be some marginal acres moved from cotton to peanuts in Georgia. I think there will be a small shift there because they planted more, but I don’t see a big shift happening.

“Nationally, the first early survey is showing us about the same on cotton acres. Some options will be weather driven when we get into the spring, especially when it comes to corn verses cotton, peanuts and soybeans.” PG

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