During times of crisis, like the COVID-19 pandemic, consumers do turn to peanuts and peanut products for a trusted economical food source and, yes, maybe even to have a good stock of. The trend is strong.
Last year was a tough production year for Southeast peanut farmers who have faced challenges on the supply and demand side of the market in recent years, but the importance of a well-stocked quality U.S. peanut supply shows benefit now.
This is the third installment of Farm Press 2020 peanut series sponsored by AMVAC "Going off the Farm." The series looks at some of the activities, initiatives and people working on behalf of the Southeast peanut industry. But under the current, and hopefully waning, COVID-19 pandemic, we shifted gears a bit with this installment and maybe for future installments, too.
We reached out the week of April 20 to two individuals, among many, who follow closely and help guide the peanut industry. We spoke with Bob Parker, CEO and president of the National Peanut Board, and with Marshall Lamb, peanut economist and research leader of the USDA National Peanut Laboratory.
Peanut consumption before the pandemic was already trending up and it looks now it will certainly continue to rise. "Just look at the numbers, and they tell a story about how consumers turn to peanuts as a comfort and reliable source of nutrition during times of crisis," Lamb said.
According to recently released data from the USDA National Agricultural Statistics Service, the domestic use of peanuts is up 4.3 percent, which is higher than original expectations of 1.9 percent. "Peanut butter consumption is leading the way in this increase as prior history has shown that peanut butter is the best option during lean times," Lamb said, adding that total peanut exports are up 24.1 percent compared to last year.
"Peanut consumption was on track to hit an all-time high for the 2019-2020 marketing year that ends on July 31 before the COVID-19 issue hit. With the surge in demand for peanut butter and snack peanuts that began in March, I don’t think there is any doubt this will be a record year for per-capita consumption in the United States," Parker said.
Online purchasing of food products has skyrocketed in the last month. Even casual searches at large e-commerce websites show some food products and staples are on backorder or temporarily unavailable, not necessarily due to a shortage but due to the volume of demand for them.
"Some of the recent increases in sales have been due to hording, but I believe time will tell that a lot of this peanut butter is being eaten. We believe many people are being reacquainted with a food they forgot how much they loved and new consumers will also make an emotional connection with peanut butter," Parker said.
Lamb said this year could reset a healthy balance to the U.S. peanut market.
"The carryout (supply) estimate has been reduced leading us to a more normal supply-and-demand balance, which is great for the industry because we’ve had several years of over-supply that has placed downward pressure on peanut prices," Lamb said.
"Planted acreage will be the key in 2020. We need to replenish the supply line, but we don’t need to grossly over-produce the market because we can easily go back to an over-supplied position. … We need a good, high-quality crop in 2020 and a year in which both farmers and shellers can profit from."
All of agriculture is important and all growers, farm labor and the industries that support them contribute greatly to the viability and security of the United States. But the peanut, it seems, tends to fight above its weight class from time to time.
There are multiple reasons why people reach for peanut butter during times of crisis, Parker said.
"It’s nutritious, shelf-stable, all ages love the taste and it’s affordable. Also, it’s the ultimate comfort food someone can pull out of the pantry at a moment’s notice as a snack or a meal. It provides a temporary sense of well-being and for many Americans, brings back memories of happier times."