Despite predictions, there will likely not be a surplus of U.S. peanuts in 2016, according to Southwest Farm Press.
The 2016 peanut crop will be about 3.15 million tons, according to U.S. Department of Agriculture (USDA). But Bob Parker, president and CEO of the National Peanut Board, said that projection is likely too high.
Adverse, hot and dry weather in primary growing regions may lower the 2016 peanut crop predictions to 2.9 million tons, Parker said.
The majority of peanuts have been inspected by the Federal-State Inspection Service. As of Dec. 19, more than 2.7 million tons of peanuts had been inspected.
Strong domestic use and record exports are also helping reduce supplies.
The industry will carry about 784,000-ton surplus into the 2017 marketing year, which starts Aug. 1. The bulk of the 2017 production will arrive at warehouses in October.
Parker said farmers need to understand the 784,000-ton surplus from one production season to another is a tight supply. The carryover is needed to keep plants shelling for the three months following arrival at warehouses.
Before planting the 2016 crop, the peanut industry urged growers to make sure they had in hand a contract and room in an approved warehouse due to incorrect information.
The June Peanut Stocks and Processing Report published in July 2016 grossly overstated the peanut supply. The July report reflected a huge adjustment by more than 750,000 tons. The large peanut surplus cost farmers money who sold their peanuts for less than what they were actually worth.
“I believe a lot of poor and costly marketing decisions were based on this incorrect information,” Parker said.
The U.S. has approved 3.7 million tons of warehouse capacity for the peanut crop.
Peanut stocks in commercial storage as of October 2016 totaled 4.14 billion pounds compared to 4.5 billion pounds last year.