Peanut Market News March 26, 2018
Possible retaliatory tariffs by China on peanuts in response to President Donald Trump's steel and other tariffs would have only a small impact on Alabama peanut producers, according to those involved in the industry.
Caleb Bristow, executive director of the Alabama Peanut Producers, said that Alabama farmers don’t depend on China for much of their sales. Bristow said China usually doesn’t buy high-quality peanuts from the United States. The country buys lower quality peanuts to be crushed up and used in peanut oil instead.
Bristow said that Alabama typically only sells peanuts to China when the state has excess supply. Selling peanuts to China helps farmers better control the domestic supply of peanuts and get better prices from U.S. buyers.
Bristow said that while recent crops of peanuts have been good, the kind of oversupply that would necessitate big sales to China to regulate their price just isn’t present right now.
William Birdsong, extension specialist for the Alabama Cooperative Extension System, agreed with Bristow.
“Where it would hurt us is if we got a huge oversupply and needed to alleviate it,” he said.
Bristow said that European tariffs recently announced would also only have a minimal impact on Alabama farmers.
Peanuts are a major crop for Alabama and the Wiregrass. According to the Alabama Peanut Producers, about half the peanuts grown in the U.S. are grown within 100 miles of Dothan. Bristow estimated that farmers devoted about 195,000 acres to peanut cultivation in Alabama last year.