Groundnut is an important oilseed crop suitable for cultivation in tropical areas of the world. Groundnut is believed to be a native of South America and scientifically known as Arachis hypogaea L.. Unique feature of this plant is its quick adaptability to a wide variety of climatic conditions.
Groundnut is the third largest oilseed produced in the world and second largest in India. India occupies the second position in terms of production and first in terms of area. China is the single the largest producer as well as consumer of groundnut in the world.
Groundnut seeds are rich source of edible oil (43-55%) as well as protein (25-28%). About two thirds of world production is crushed for oil and the remaining one third is consumed as nuts. The cake or meal is used as animal feed and the shell sometimes used as fodder.
Climate and cultivation
Although, the groundnut plant is adaptable for wide climatic conditions, it requires 14 to 16oC for germination, a long and warm growing season lengthens flowering. High temperatures result in the best performance in terms of length of the stem, number of flowers and number of pods. Maximum number of pods will be at mean temperatures of 23oC. Good yields are expected with a well-distributed 37 to 60 cm of rainfall during the crop period. However, summer groundnut crop can thrive with 12.5 to 17.5 cm rainfall during the fortnight after sowing and 37 to 60 cm during the growth of the crop.
Although the crop can be grown in all the seasons, kharif season production accounts for about 80 % of the total production. More than 90 % of the groundnut area is grown under rainfed condition. Kharif crop is grown during June-September period in majority of Gujarat and Maharashtra. In southern region it is grown as kharif as well as rabi crop and in southeastern states it is even cultivated in rice fallows during October-March. Groundnut is also cultivated during January-May as a summer crop under assured irrigation.
China is the largest producer of groundnut in the world accounting for more than 40% followed by India with about 15% share. Though, India is the largest cultivator of groundnut crop in terms of acreage, low yields kept her in the second place in terms of output. Further, production of groundnut in India has persistently been declining from mid-2000s.
China is not only the largest producer but also the largest consumer in the word. Following the sharp increase in consumption, exports from China declined steadily from 2008 onwards. As a result, Argentina became the largest exporter of groundnut though for a brief period of two years (2010-11 and 2011-12) India became the top exporter. Major importing outcries have been the European Union, Vietnam, Indonesia, Mexico and Russia.
Groundnut production remained at around 35 million tons until mid 2000s and thereafter steadily rose to reach nearly 40 million tons in the 2012. World trade also rose steadily but slowly from about 2 million tons to nearly 3 million tons during the past decade. Nevertheless, groundnut stocks appear to be at comfortable level despite a marginal reduction in output in 2012-13.
India has remained in the second among the top groundnut producing countries despite having the largest area under groundnut cultivation in the world owing to the low yield. In addition, area under cultivation has been declining steadily.
Groundnut used to be largest produced oilseed in the country but its share has declined particularly in 2000s due to sharp rise in soybean production. Nevertheless, groundnut output remained largely stable in the recent years moving in a narrow range. Although the estimates from the GoI and the USDA differ widely their long term trend appears to be similar. The estimates of the GoI have been in the range of 7 to 8 million tons during the past four years while that of USDA stood in the range of 5 to 6 million tons in the same period. Nevertheless, the trend of relative change from year-to-year observed to in the same direction though the magnitude of change or fluctuation was small in case of USDA estimates.
Gujarat is the single largest as well as the best quality groundnuts producer accounting for over 40% of total groundnut produced in the country. Groundnut production, within the country, is mainly concentrated in five states including Gujarat, Andhra Pradesh, Tamil Nadu, Karnataka, Rajasthan and Maharashtra accounting for nearly 90 % of the total production of groundnut in the country. The remaining groundnut cultivated area is scattered in the states of Madhya Pradesh, Uttar Pradesh, Punjab, and Orissa.
Major Cultivated Varieties
Kharif: Vemana (K 134), TPT I, TPT 2, TPT 4, JCG 88, K5, Narayani, JL 24, TMV 2
Rabi: TPT 2, K 134, TPT 4, K3, ICGS 11, ICGS 44, DRG 12, DRG 17, K6
Major physical markets: Rajkot, Ahmedabad, Mumbai and Delhi are the major trading centers.
Groundnut is not traded in futures markets.
India has been net exporter of groundnut seed. Major export destinations are Asian countries.
Major export destinations: Indonesia, Vietnam, Malaysia, Philippines, Thailand, Ukraine and Pakistan.
Major import sources: NA
Factors influencing prices
- Crop condition and output expectations: Extent of area sown under the crop, condition of the crop and output expectation.
- Monitoring of rainfall and weather conditions that could affect the crop output.
- Demand expectation: Any changes in demand both domestic as well as international markets.
- Being export oriented commodity, its prices are also influenced by exchange rate.
- Stocks available in the market.
- External demand and supply: Demand supply situation in major import sources.
- Trade policies: Any change in government policy relating to change in tariffs etc.,