Peanuts: perplexing trade dynamics

India indirectly profits from tariffs

Peanuts are showing mild gains and progress will stir up in India in the next few weeks. Main driver are fluctuations in the edible oil market. US tariffs and the responses in several countries affected are resulting in repercussions, which are indirectly benefitting Indian peanuts. For instance, the prices for sunflower oil, palm oil and soybean oil came down two weeks ago, then turned positive again. Presently, the whole market is in a perplexing situation and traders are refraining from executing any big procurements. Most traders are, therefore, turning to peanut oil.

In addition, the demand from China surged within only three to four days. Ground level prices have shown an increment of 4-5%, which will impact international prices in the next week or so. Another aspect to consider is that various state governments have been buying which has reduced the overall stock in the market and that arrivals range 25-30% lower than in previous weeks. In Uttar Pradesh the daily inflow was around 75,000-80,000 bags per day. Yet, daily arrivals are now barely reaching 15,000-20,000 bags. Advice is to only buy small amounts of peanuts at regular intervals rather than getting carried away in the heat of the moment by investing all funds.

How far can prices rise in India?

Although peanuts have gained in India, the market has been particularly aggressive on pricing, largely due to ample supplies. The surplus has given buyers in Southeast Asia a strong advantage, allowing them to secure contracts at highly competitive rates. While this abundance has helped maintain steady trade flows, it has also put pressure on sellers who are navigating the risks of oversupply. The question now is whether demand will catch up to balance the market, or if further price adjustments will be needed to sustain momentum.

Tariffs complicate US trade flows

Discussions around the upcoming peanut crop are gaining momentum, with market participants carefully evaluating their next moves. The competition with cotton remains a key variable — if cotton prices fail to improve, peanut acreage may either hold steady or expand. However, a final decision on planting intentions is still a few weeks away. Some industry observers expect a softer market outlook as a result, with pricing adjustments likely. Quality concerns have also emerged due to insufficient crop rotation, raising questions about the long-term impact on supply. Meanwhile, buyers are taking a calculated approach — some are locking in contracts early, while others are waiting in hope of a more significant price drop. Trade flows have been further complicated by recent tariff changes, particularly affecting exports to China, Canada, and Mexico.

Quality concerns in Argentina

As the 2025 crop cycle unfolds, anticipation is growing around an expected expansion in planted acreage, with estimates pointing towards an 8-10% increase. While last year’s crop showed impressive yields, the current season may not replicate the same productivity levels. However, a larger cultivation area could offset any potential drops in output. The real concern, at this stage, lies in quality, which remains uncertain and highly dependent on weather conditions over the next month and a half. This period will be decisive in shaping the outcome of Argentina’s peanut production, and industry players are closely monitoring developments.

Aggressive pricing in Brazil

The success of Brazil’s crop hinges largely on weather patterns, with farmers currently hoping for drier conditions to facilitate smooth harvesting. Any prolonged rainfall at this stage could cause complications, potentially reducing yields. Given last year’s underwhelming crop, exporters are particularly keen on delivering a stronger performance this time. Many are already structuring their pricing strategies based on a recovery in production, though the real picture will become clearer in the coming weeks. Aggressive pricing tactics are already evident, particularly in non-European markets, as Brazil pushes to regain its competitive position. This shift could influence traditional markets that typically source from the US and Nicaragua.

Demand is key driver for China

Despite favourable production conditions, the Chinese peanut market has been showing signs of price softening, particularly as demand for peanut oil remains sluggish. However, there are discussions around potential export opportunities, provided freight rates continue to remain manageable. A key factor to watch is global consumption — any uptick in demand could quickly shift China’s approach. Interestingly, with competitive pricing coming out of Argentina and Brazil, speculation is that China may once again turn to importing high oleic peanuts if supply conditions remain stable. How this plays out will largely depend on external market dynamics and the ability of Chinese importers to secure attractive deals.

View more
- price chart, peanuts, with skin, 40/50, Bold, India
- price chart peanuts, with skin, 50/60, Java, India
- price charts for nuts, dried fruit, oilseeds and many more products