Core Viewpoint

The overall stance is neutral.

Prices

Imported Sudanese peanut prices have risen, while oil-grade peanut prices held steady. Conversely, prices for commercial-grade and common peanuts declined. As the futures market weakened, the cash basis for oil-grade peanuts strengthened.

Supply

Old-crop peanut inventory in the Northeast is scarce, prompting some buyers to shift towards Henan spring peanuts. However, the moisture content of recently harvested peanuts is relatively low. With improving weather conditions, the volume of peanuts arriving at the market has increased. The significant price drop for new-crop peanuts has also dragged down old-crop prices.

Demand

Only a small number of oil mills are currently receiving goods. Most other mills are waiting for the new crop to hit the market, though some are inquiring about prices for new peanuts. Processors are taking advantage of lower prices to buy, essentially purchasing on an as-needed basis. Downstream terminal demand is also characterized by small orders.

Weather

Over the next period, only a few peanut-producing regions are expected to see rainfall, with most areas remaining dry. Soil moisture levels in Henan and Liaoning provinces continue to decline.

Market Analysis

As weather improved in Henan, the supply of spring peanuts increased, leading to a sharp weekly decline in cash prices. With the price gap between new and old crops narrowing, old-crop prices followed suit. A few oil mills have started inquiring about new peanuts, and processors are making small replenishments. However, the high cost of stored old-crop peanuts is causing holders to resist further price drops, slowing the decline's pace in the latter half of the week.

Current channel and terminal edible peanut inventories are low. While oil mill peanut stocks are falling rapidly, they remain higher than the same period last year. Following the recent sharp drop in cash prices, current market rates are hovering near production costs.

Meanwhile, the peak supply period for early-maturing peanuts in Hubei and Jiangxi has concluded. The market's new crop supply is now primarily sourced from Henan. The future market focus will be on the weather during the growth and harvest of summer-planted peanuts. Improved weather leading to increased new crop supply will likely cap any price rebound.

Historical Context and Drivers

In early 2022, peanut prices were primarily driven by the supply pressure of the old crop and initially diverged from the broader oils and oilseeds market. However, as oilseed and protein prices rallied to highs, peanuts experienced a broad-based rally. That co-movement was mainly fueled by the rapid appreciation of peanut oil and peanut meal, which sharply boosted crushing margins.

Currently, despite the rise in vegetable oil and soybean meal prices, peanut oil and peanut meal values have seen limited change. After all, the price spread between peanut oil and soybean oil hasn't compressed to low levels, and the soybean meal to peanut meal spread hasn't expanded sufficiently. Downstream demand for peanut oil and meal hasn't increased significantly yet, requiring more time. For now, the market is more focused on stabilizing cash prices.

Detailed Price Data (as of August 28, 2026)

Imported Sudanese peanuts are quoted at 8,200 yuan/ton, up 150 yuan/ton for the week. The average price of common peanuts is 8,036 yuan/ton, down 3.82% week-on-week. Commercial-grade peanuts average 8,975 yuan/ton, a weekly decrease of 5.28%. Oil-grade peanut prices remained stable at 7,454 yuan/ton. The main peanut futures contract fell 0.98% week-on-week to 8,058 yuan/ton.

Basis and Spreads

As of August 28, the domestic average price for oil-grade peanuts was 7,454 yuan/ton. The cash basis against the PK2611 contract was -604 yuan/ton, compared to -684 yuan/ton the previous week. The stable cash price for oil-grade peanuts, combined with a falling futures market, caused the basis to strengthen.

The spread between commercial-grade and oil-grade peanuts narrowed to 1,521 yuan/ton as of August 28, down from 2,021 yuan/ton the previous week, due to the significant weekly drop in commercial-grade prices.

The price spread between peanuts in the Northeast and Henan has turned negative. In Fuyu, Jilin, common peanuts (8-sieve, 9% moisture) are priced at 4.3 yuan/jin, down 0.15 yuan/jin for the week. In Zhengyang, Henan, similar peanuts are at 4.7 yuan/jin, down 0.45 yuan/jin. This shift is because the Northeast is still quoting old-crop peanuts while Henan offers new-crop prices. The spread is now -0.4 yuan/jin, compared to -0.7 yuan/jin last week.

Processed Product Prices

In Shandong, first-grade common peanut oil is priced at 13,900 yuan/ton, remaining stable for the week. First-grade soybean oil there rose 70 yuan/ton to 9,010 yuan/ton. The spread between the two narrowed to 4,890 yuan/ton from 4,960 yuan/ton, as peanut oil held steady while soybean oil increased.

Shandong peanut meal is quoted at 3,000 yuan/ton, stable week-on-week. Soybean meal cash prices rose 110 yuan/ton to 3,190 yuan/ton. The soybean meal to peanut meal spread widened to 190 yuan/ton from 80 yuan/ton the previous week.

Supply and Inventory Data

As of the week ending August 27, 2026, peanut inventory at sample peanut oil enterprises stood at 156,810 tons, a decrease of 26,530 tons or 14.47% week-on-week, marking a continuous decline.

Peanut oil inventory at these sample enterprises was 43,350 tons as of August 27, down 50 tons, or 0.12%, for the week.

Import Data

Imports of unshelled peanuts reached 24,000 tons in July, down from 34,500 tons in June but significantly higher than the 500 tons imported in the same period last year. Cumulative imports for January-July reached 95,300 tons, more than double the 38,300 tons imported during the same period last year.

Shelled peanut imports totaled 44,600 tons in July, an increase from 16,700 tons in June and 9,100 tons in July of the previous year. Cumulative imports for the first seven months were 164,300 tons, up from 75,300 tons last year.

Using a 70% shell-out ratio for unshelled peanuts and converting both categories, total July imports were approximately 61,500 tons, higher than June's 40,900 tons and July of last year's 9,400 tons. Cumulative imports for January-July were 257,800 tons, an increase of 155,700 tons compared to the same period last year.

Demand and Processing Data

The theoretical peanut crushing profit in Shandong was 68 yuan/ton as of August 28, down from 95 yuan/ton the previous week, due to weaker peanut meal prices.

The operating rate at sample peanut oil enterprises was 19.97% as of August 27, a slight decrease of 0.19% week-on-week but an increase of 13.65% year-on-year.

Weather Forecast

Over the next 10 days (Aug 30 - Sep 8), significant rainfall is expected in the Jiangnan, southern China, eastern Jianghan, Jianghuai regions, as well as southern Tibet, western Yunnan, and northern Heilongjiang. Most areas will see 40-80 mm, with some regions receiving 100-150 mm. Localized areas along the southeast coast, Jianghuai, and Hainan could see over 250 mm. Precipitation in these areas will be 50% to 200% higher than normal for this time of year, while most other regions will see below-average rainfall.

From September 9-12, cumulative rainfall of 15-40 mm is expected in the southwestern region, eastern part of northwest China, and southern China, with some areas seeing around 50 mm. Most other regions will have little to no precipitation. Temperatures are expected to be lower than average in the northeast, north China, southern China, and Yunnan, while most other areas will see above-average temperatures.