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From December 7 to 17, 2023, the Brazilian Trade and Investment Promotion Agency (ApexBrasil) hosted an official mission from India, comprising journalists and businesspeople focused on expanding agribusiness ties and bilateral trade. The mission visited key Brazilian states, including São Paulo, Minas Gerais, Rio de Janeiro, and the Federal District, engaging in meetings, technical visits, and discussions with agricultural entities.
The mission highlighted the potential for expanding Brazil-India trade. Brazil's agribusiness sector demonstrated its strength with discussions on food security, sustainable practices, and technology transfer. Brazil's strong agricultural research, such as the development of genetically improved seeds for peanuts and beans, was also emphasized. The visit underscored the strategic importance of strengthening trade ties, with both countries aiming to tackle global challenges like food insecurity, climate change, and energy transition.
Bilateral trade has grown significantly, with Brazilian exports to India reaching USD 4.7 billion in 2023, yet considerable room remains for expansion. As Brazil seeks to diversify its export portfolio, the mission provided a platform for fostering deeper cooperation between the two nations, especially in agribusiness and sustainable production practices.
According to the Statistics Agency, from Jan-24 to Nov-24, Uzbekistan exported 11,496 metric tons (mt) of peanuts valued at USD 18.2 million. Pakistan was the largest importer, purchasing 2,817 mt, followed by Azerbaijan with 1,409 mt, Russia with 1,382 mt, Turkmenistan with 1,184 mt, and Kazakhstan with 970 mt. An additional 3,734 mt were exported to other countries.
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In W51, United States' (US) peanut prices surged to USD 0.60 per kilogram (kg), marking a 25% week-on-week (WoW) increase. This spike is due to significant yield reductions in Georgia, the country's leading peanut-producing state. Adverse weather conditions, including excessive rainfall, delayed planting, and an unusually cool fall, caused a prolonged harvest and severe disruptions on over half of Georgia's peanut acreage. As a result, yields fell to 3,500 pounds (lbs) per acre, far below historical averages. While other regions have partially offset Georgia's shortfall, the supply reduction in this key state could sustain elevated prices in the short term. If similar weather anomalies impact other peanut-growing regions or disruptions continue, peanut prices may experience upward pressure into future seasons.
Additionally, peanut growers are preparing for potential challenges in the upcoming farm bill discussions. Opponents of the current peanut commodity program may push for stricter participation requirements and reduced crop insurance coverage. Conservation programs are also expected to face scrutiny. However, strong legislative support, particularly from Georgia's influential lawmakers and the Secretary of Agriculture, provides a foundation for optimism. Farmers are focused on improving market prices and ensuring farm profitability, with research advancements helping to enhance production, though economic viability remains a key concern for the sector's future.
Brazil's peanut prices fell to USD 2.90/kg in W51, down 1.38% WoW and 12% year-on-year (YoY). The 2024/25 season is forecasted to reach a record production of 832,300 mt, a 40.6% YoY increase, potentially creating oversupply and further price pressure if demand, particularly from oil mills, does not rise proportionately. Challenges like weed resistance and pest management could affect competitiveness. In the Itaju region, drought has delayed planting, impacting peanut and oil production, though much of the area remains productive with a positive harvest outlook.
To capitalize on opportunities ApexBrasil highlighted, Brazilian peanut exporters should strengthen trade relations with India by aligning export strategies with India's demand for high-quality peanuts. This can include introducing targeted marketing campaigns to promote Brazilian peanuts in India and collaborating on technology transfers for sustainable cultivation and processing. Formal trade agreements and reduced tariff barriers can further enhance market access and foster long-term partnerships.
To mitigate the risk of oversupply in the 2024/25 season, Brazil's peanut producers and exporters should focus on diversifying export markets, targeting regions with rising peanut demand, such as Central Asia and the Middle East. Collaborations with ApexBrasil and local governments can facilitate these regions' trade missions and marketing efforts. Additionally, exploring value-added peanut products, like peanut oil and peanut butter, can broaden market opportunities and absorb excess supply.
Sources: Noticias Agricolas, UZ Daily, the Albany Herald
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