Peanut Situation and Outlook Peanut Situation and Outlook for 2000/2001for 2000/2001

Southern Region Agricultural Outlook ConferenceSeptember 25-27, 2000

Peanut Situation

Crop conditions a mixed bag U.S. production on a downtrend Domestic demand slowly increasing Exports flat Stocks at burdensome level but expected to

be trimmed in 2001 Lowest prices in a decade

Peanut Planted Acres by Region

0

500

1000

1500

2000

US Southeast Southwest VC

U.S. Peanut Yields

1600

1800

2000

2200

2400

2600

2800

3000P

ou

nd

s

US Peanut Production

2000

2500

3000

3500

4000

4500

5000

5500

Mil

lion

Pou

nds

Production

US Peanut Production and Quota 1990-2000

0

0.5

1

1.5

2

2.5

3

90 91 92 93 94 95 96 97 98 99 '00

Crop Year

Far

mer

Sto

ck E

quiv

alen

tM

illi

on T

ons

Basic Quota Effective Quota Production Food Use

Quota Plus Buybacks

U.S. Peanut Balance Sheet

million pounds (Sept 13, 2000)

25.628.4Average Price

103512291392Ending Stocks

411641613575TOTAL USE

391496401Seed & Residual

720720562Exports

710713460Crush

229522322153Food Use

515153904967TOTAL SUPPLY

169169155Imports

375338293963Production

12291392848Beg. Stocks

2000/01 Proj.1999/00 Est.1998/99

World Peanut Production by Country

3%

1%

35%

21%

40%

US

Argentina

India

China

Other

World Peanut Production

0

2

4

6

8

10

12

14

Mil

lion

Met

ric

Ton

s

1998 1999P 2000F

USChinaIndiaArgentinaOthers

Source: FAS, USDA

Domestic Food Use Of Peanuts

0

0.2

0.4

0.6

0.8

1

1.2

1.4

89 90 91 92 93 94 95 96 97 98 99F

Crop Year

FS

To

ns

Adjusted For Imports

Edible Peanut Use by Product 1999/2000

51%

23%

26%

PeanutButter

Candy

Snack

Domestic Peanut Use

0200400600800

10001200140016001800

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

Mil

lion

Pou

nds

Total Candy Snacks Peanut Butter

Use of Shelled Edible PeanutsAugust thru June

8.3

12.3

-1.6

2.8

-7.4

14.7

4.4 3.6

-10

-5

0

5

10

15

20

Per

cent

Cha

nge

97/98 vs 98/99 98/99 vs 99/00

Candy Snacks PButter Total

Government Purchases For Food and Child Nutrition Programs

0

5

10

15

20

25

30

35

40

95/96 96/97 97/98 98/99 99/00 *

Crop Year

Tho

usan

d T

ons

FS

E

* Through June ‘00

Trend in the Volume of Exports for USA

0

100

200

300

400

500

600

YEAR

TH

OU

SA

ND

ME

TR

IC

TO

NS

Major Peanut Export Destinations

29%

27%15%

12%

4%3%

10%

NetherlandsCanadaMexicoUnited KingdomSpainJapanOther

1999 Marketing Year

Old Crop Carry-In Stocks

0

100

200

300

400

500

600

700

Far

mer

Sto

ck

Equ

ival

ent,

1,0

00 T

ons

Marketing Year

U.S. Average Peanut Price

23

24

25

26

27

28

29

30

31

1991 1992 1993 1994 1995 1996 1997 1998 1999

Cen

ts /

Pou

ond

Average Price

Price of 50% Peanut MealSoutheast Mills

0

50

100

150

200

250

91 92 93 94 95 96 97 98 99*

Crop Year

$ P

er T

on

* Estimated

Price of Peanut Oil, Southeast Mills

0

10

20

30

40

50

60

91 92 93 94 95 96 97 98 99*

Crop Year

Cen

ts P

er P

ound

* Estimated

Outlook for 2000-01

Prices at support level despite drought conditions

Continuation of current trends on supply and demand side– Reduction in additional peanut acreage– Increasing yields– Steady growth in demand– Global competition

Peanut Industry Issues

Quality - aflatoxin Irrigation receiving

contracts Increased Promotion –

National Peanut Board Competitiveness in

export market Future of the Peanut

Program