The Global and African Groundnut Value Chain: Dynamics, Markets, and Strategic Pathways

August 10, 2025

Executive Summary

Groundnuts, a high-value legume crop, are fundamental to food security, nutrition, and rural livelihoods globally, particularly across Africa. This report provides a comprehensive analysis of the groundnut value chain, detailing its stages, key actors, and specific dynamics within African nations, alongside an examination of the global market for value-added products such as peanut oil, peanut butter, roasted peanuts, and peanut meal.

Analysis reveals that despite Africa’s significant land area dedicated to groundnut cultivation, its yields remain considerably lower than other continents, underscoring a substantial untapped potential for increased productivity. A persistent challenge within the value chain is the power imbalance that often disadvantages smallholder farmers, who capture a disproportionately low share of the final consumer value. This is frequently exacerbated by limited access to improved seeds, modern agricultural practices, and structured markets, compounded by pervasive issues like aflatoxin contamination which severely impacts product quality, human health, and export opportunities.

However, significant opportunities exist for enhancing the efficiency and competitiveness of the sector. Promoting value addition at the farm or farmer-group level, such as de-shelling and primary processing, can substantially increase farmer margins. The growing global demand for healthy, convenient, and plant-based food products provides a robust market for diversified groundnut derivatives. Furthermore, strategic policy interventions, regional trade agreements like the African Continental Free Trade Area (AfCFTA), and targeted investments in infrastructure, technology, and farmer capacity building are crucial for unlocking the full potential of the African groundnut sector. By addressing these structural barriers and leveraging market trends, the groundnut value chain can become a more equitable and prosperous engine for economic development and food security.

1. Introduction: Groundnuts as a Global Agricultural Commodity

Groundnuts (Arachis hypogaea), commonly known as peanuts, represent a high-value legume crop with profound implications for employment generation and the enhancement of rural living standards worldwide.¹ Beyond their economic significance, groundnuts play a critical role in ensuring food security and meeting nutritional requirements across diverse socio-economic strata.¹

As a versatile crop, groundnuts are an abundant source of edible oil, constituting 43-55% of their composition, and protein, accounting for 25-28%.² Globally, approximately two-thirds of the total groundnut production is processed for oil extraction, while the remaining one-third is consumed directly as food.² The utility of groundnuts extends further to their by-products, such as oilseed cake and haulms, which are valuable components in animal feed formulations.²

Cultivation of groundnuts spans 108 countries globally. Asia stands as the dominant force in global groundnut output, contributing a remarkable 71.7% of the total. In contrast, Africa, despite dedicating 31.3% of the world’s groundnut cultivation area, accounts for a comparatively smaller share of global production at 18.6%.² This disparity highlights a significant area for potential growth and development within the African groundnut sector.

The dual role of groundnuts as both a staple food and a cash crop positions them as a critical economic driver, particularly for the rural poor and women. The consistent emphasis in various studies on groundnuts being a “high-value crop with potential to create employment and improve the living standards of the rural poor” ¹ and a “primary source of income for a vast majority of family farms” ³ underscores their profound socio-economic impact. The substantial involvement of women as farmers, traders, and processors further amplifies the crop’s contribution to poverty reduction, job creation, and gender empowerment.¹ Consequently, strategic investments and policy interventions within the groundnut value chain hold the potential for holistic development, extending beyond mere agricultural output to encompass broader societal benefits.

Furthermore, Africa’s current productivity levels in groundnut cultivation suggest a significant unfulfilled potential for increased output and a larger contribution to the global supply. Despite allocating 31.3% of the global land area to groundnuts, Africa’s production share is only 18.6%.² This is starkly evident in the average yields: Africa achieves approximately 1 tonne per hectare (t/ha), which is considerably lower than America’s 3 t/ha and Asia’s 1.8 t/ha.⁵ This substantial productivity gap indicates that even marginal improvements in agricultural practices, adoption of advanced technologies, and enhanced access to essential inputs could lead to significant increases in groundnut production and farmer incomes. Such advancements would not only bolster Africa’s position in the global market but also reduce its reliance on imports to meet domestic demand.¹

2. The Groundnut Value Chain: Stages, Activities, and Key Actors

The term “value chain” encompasses the entire spectrum of activities involved in bringing a product or service from its initial conception to the final consumer. This includes the physical movement of the product, the processes that add value at each stage, and the underlying market dynamics that govern its flow.²

Key Stages and Activities

The groundnut value chain typically comprises several interconnected stages, each involving distinct activities and actors:

Input Supply: This foundational stage involves the provision of crucial agricultural inputs, including seeds, agrochemicals, and pesticides. A notable characteristic, particularly in African contexts, is the high reliance on saved seeds from previous harvests—73% in Kenya and 59% in Ghana—rather than improved or certified varieties.⁴ This practice significantly impacts overall crop yields and quality.⁴
Production/Cultivation: Farmers, predominantly smallholders and often women, are responsible for cultivating groundnuts. Agricultural practices are frequently extensive, relying heavily on rain-fed conditions and family labor. The adoption of fertilizers or improved technologies remains limited, primarily due to high input costs, specific soil conditions, and insufficient knowledge among farmers.¹
Post-Harvest Handling: Following cultivation, activities include on-farm storage, shelling (which can be manual or mechanical), grading, and sorting. Farmers can significantly increase their profitability by selling groundnuts in shelled form.² Emerging models, such as Farmer Producer Companies (FPCs) or Farmer-Controlled Service Centers (FCSCs), are designed to centralize aggregation, grading, sorting, and packaging services. These entities have the potential to boost farmer margins by 10-15% through initial de-shelling operations.⁶
Aggregation/Collection: Aggregators, often individuals who are themselves farmers or community members, play a vital role in collecting produce from numerous smallholder farmers. They serve as essential conduits to markets, sometimes extending services such as input supply and agricultural extension.¹ These aggregators, along with wholesalers, function as critical “hubs” within the value chain, effectively connecting production areas with major consumption centers.¹
Processing: At this stage, raw groundnuts are transformed into a diverse array of value-added products, including paste, various snacks, roasted groundnuts, flour, and oil.¹ Processing operations range from small-scale, informal enterprises, frequently managed by women, to larger, more formalized industrial facilities.¹ By-products, such as defatted groundnut cake (known as “kulikuli”), are also further processed for human consumption or animal feed.¹
Trading/Distribution: This involves the movement and sale of both raw and processed groundnut products through multiple channels. These include wholesalers, retailers, street vendors, restaurants, and institutional buyers.¹ In some instances, large-scale traders act as importers, bringing shelled groundnuts from other countries to satisfy domestic demand.¹
Consumption: The final stage where consumers acquire and utilize groundnut products for their dietary needs, reflecting the culmination of the value chain activities.⁴

Key Actors Across the Chain

The efficacy and profitability of the groundnut value chain depend on the interplay of various actors:

Farmers (Producers): These are the foundational actors, primarily smallholder farmers, with a significant proportion being women, who are responsible for cultivation and initial post-harvest activities.¹
Aggregators/Distributors: These intermediaries collect produce from farmers and facilitate its transport to processors or markets. They often wield considerable market influence and, in many cases, realize the highest return on investment within the value chain.¹
Processors: These entities transform raw groundnuts into value-added products. The majority operate as micro or small-scale enterprises, frequently led by women.¹
Traders (Wholesalers, Retailers, Importers): These actors ensure market access and the smooth flow of products. Retailers, often women, are significant beneficiaries of the value added at the consumer end of the chain.¹
Farmer Producer Companies (FPCs) / Farmer-Controlled Service Centers (FCSCs): These represent evolving organizational models designed to empower farmers. By undertaking aggregation, primary processing, and direct marketing, these entities aim to increase farmers’ share of the consumer rupee.⁶

The current structure of the groundnut value chain frequently places farmers at a disadvantage, as they tend to capture a disproportionately low share of the consumer rupee. Historical data indicates that farmers’ share was around 25% before interventions.⁶ While farmers can enhance their profits by selling shelled groundnuts, distributors consistently achieve the highest return on investment across the value chain.² This disparity is compounded by the “atomistic” nature of the value chain, characterized by a multitude of smallholder farmers and a comparatively smaller number of large-scale aggregators and wholesalers. These intermediaries are often better informed and possess the logistical capabilities to connect production areas with consumption centers, enabling them to capture a larger portion of the value and consequently limit farmers’ income and their ability to invest in productivity improvements.¹

Conversely, the implementation of primary processing activities, such as de-shelling, at the farmer or Farmer Producer Company (FPC) level, presents a clear and substantial pathway to increasing farmer margins and mitigating risk. A case study from Rajasthan demonstrates that FPCs initiating de-shelling operations can achieve “10-15% higher margins and lower risk”.⁶ This observation is further corroborated by research in Ghana, which indicates that farmers realize greater financial benefits when they sell groundnuts in shelled form.² This compelling financial incentive provides a strong rationale for investing in and promoting localized primary processing infrastructure, thereby empowering farmers or farmer-led organizations to move beyond merely supplying raw commodities and to capture a greater share of the value generated within the chain.

Table: Typical Stages and Key Actors in the Groundnut Value Chain

Value Chain Stage	Key Activities	Primary Actors	Potential for Value Addition/Intervention
Input Supply	Provision of seeds, agrochemicals, pesticides	Input suppliers, Farmers (saved seeds)	Promoting certified seed access, knowledge dissemination on improved varieties
Production/Cultivation	Land preparation, planting, weeding, harvesting	Smallholder farmers (predominantly women), Commercial farmers	Improved agricultural practices, mechanization, access to finance for inputs
Post-Harvest Handling	Drying, on-farm storage, shelling, initial grading/sorting	Farmers, Traders, Service providers (shelling)	FPCs/FCSCs for aggregation, de-shelling, grading, and packaging
Aggregation/Collection	Collecting produce from farmers, initial transport	Aggregators (often farmers/community members), Wholesalers	Strengthening farmer groups, direct market linkages, improved transport logistics
Processing	De-shelling, milling (flour/paste), roasting, oil extraction, packaging	Micro/small-scale processors (often women), Industrial processors	Access to finance for equipment, training in new techniques, quality control (aflatoxin mitigation)
Trading/Distribution	Wholesale, retail, import/export, transport to markets	Wholesalers, Retailers (street vendors, shops), Importers	Market information systems, formal trade associations, cold chain development
Consumption	Purchase and utilization of groundnut products	Consumers	Awareness campaigns on nutritional benefits, product diversification

3. Groundnut Value Chains in African Nations: Case Studies and Common Themes

Groundnut value chains across African nations exhibit unique characteristics shaped by local contexts, yet share several common challenges and opportunities. Examining specific country cases provides a deeper understanding of these dynamics.

3.1. Ghana’s Groundnut Value Chain

In Ghana, groundnuts are recognized as a high-value crop, crucial for both food security and nutrition, with the majority of production primarily serving domestic consumption.¹ A significant portion of the country’s groundnut output, approximately 85%, originates from the Northern regions.¹ The crop is processed into a variety of products including paste, snacks, roasted groundnuts, flour, oil, and “kulikuli” (a fried cake made from defatted groundnut paste).¹ The market structure is largely “atomistic,” characterized by numerous small-scale participants, which often leads to low margins and intense competition.¹ Despite these challenges, the groundnut value chain in Ghana is a substantial contributor to employment and the national economy, notably demonstrating positive impacts on women, the poor, and youth development.¹ However, Ghana is increasingly relying on imports to meet its domestic groundnut demand, indicating a gap between local supply and consumption.¹

Key actors in Ghana’s groundnut value chain include smallholder farmers, categorized as those not affiliated with an aggregator (NASH) and those who are (ASH), as well as commercial farmers. Aggregators, wholesalers, retailers (often women), processors (predominantly informal, micro, or small-scale, frequently women-led), and importers all play distinct roles.¹ NASH farmers are significant beneficiaries, contributing 39% of the direct value added, followed by retailers (20%) and paste processors (15%).¹

Specific challenges confronting Ghana’s groundnut value chain are multifaceted. A critical concern is aflatoxin contamination, with high levels frequently detected in products like kulikuli and paste, often exceeding stringent EU limits due to inadequate post-harvest and processing practices.¹ While Ghana’s national acceptable limit for aflatoxin in peanuts is 10 parts per billion (ppb), levels over 50 ppb are commonly observed.⁷ This contamination poses severe human health risks, including stunting in children and an increased risk of liver cancer in adults, and results in substantial economic losses, with Africa estimated to lose up to $670 million annually.⁷ The issue has notably led to a sharp decline in EU imports of Ghanaian peanut products since 2008.⁷

Agricultural practices are largely extensive, characterized by minimal fertilizer application and consequently low yields.¹ Farmers face significant barriers due to the limited availability and high cost of certified seeds and fertilizers.¹ The

informal sector, where most micro and small-scale processing enterprises operate, struggles with accessing adequate funding.¹ Furthermore, women working at these processing sites often endure hazardous conditions, including excessive heat and smoke.¹

Market and infrastructure limitations also present considerable hurdles. The substantial geographical distance between the primary production areas in Northern Ghana and the major consumption centers in the South creates significant logistical complexities.¹ Support from farmer-based organizations (FBOs) for groundnut farmers is limited, impeding their access to certified seeds, fertilizers, effective extension services, and robust marketing channels.¹ Despite women’s central and often dominant role in the value chain,

gender inequality persists, with their access to resources and services often being disproportionately low. They frequently lack formal land rights and tend to cultivate marginal lands.¹

3.2. Kenya’s Groundnut Value Chain

In Kenya, female farmers constitute the majority of peanut producers, accounting for 68% of the total, primarily operating as smallholders in rural areas.⁴ Cultivation is heavily reliant on rain-fed agriculture and family labor, which is utilized by 78% of farmers.⁴ Farm sizes are typically small, averaging 0.2 hectares.⁴ Most farmers cultivate groundnuts primarily for personal consumption, selling any surplus produce.⁴ Despite the various challenges, all nodes within the Kenyan groundnut value chain have been identified as profitable, with the processor node demonstrating the highest financial viability.⁴

The key actors in Kenya’s groundnut value chain include farmers (producers), aggregators (70% female), traders (60% female, operating without formal trade associations and with pricing determined by laissez-faire methods), processors (60% female, generally small-scale and operating year-round), and consumers.⁴

Specific challenges within the Kenyan groundnut value chain are evident at multiple stages. In input supply, there is a high reliance on saved seeds (73%) rather than certified varieties, and a low awareness and adoption rate of improved varieties, with only 1.5% of farmers reporting their use.⁴ Fertilizer usage is almost non-existent, attributed to high costs, specific soil conditions, and limited farmer knowledge.⁴ Additional issues include the short shelf-life of seeds, high transportation costs for inputs, and low market prices at harvest, which disincentivize investment in quality inputs.⁴

At the production node, low yields are a direct consequence of the limited adoption of improved varieties and the absence of fertilizer use.⁴ The reliance on rain-fed agriculture renders production vulnerable to climate variability.⁴ Farmers often lack the capacity to grade and standardize peanuts, leading to inconsistent product quality.⁴ Pests and diseases pose significant threats to crop health.⁴ Furthermore, poor road networks and inadequate handling facilities contribute to substantial post-harvest losses.⁴

Market and finance issues are also prevalent. Stiff competition among numerous aggregators creates a challenging environment.⁴ Both traders and processors face poor access to market information and insufficient financial support, which hinders their ability to invest in necessary upgrades and make informed business decisions.⁴ Unstable market prices for processed products introduce considerable financial uncertainty.⁴ Finally,

quality concerns are significant, particularly regarding poor product quality and mycotoxin (aflatoxin) contamination, which impacts marketability and consumer safety.⁴

3.3. Malawi’s Groundnut Value Chain

Malawi’s groundnut value chain faces several distinct challenges. High aflatoxin contamination is consistently cited as a major issue, affecting human safety, food quality, and cross-border trade.⁸ This contamination originates in the field and is exacerbated after harvest due to poor handling, high temperatures, and prolonged storage.⁸ The severity of this problem was highlighted by a sharp decline in Malawi’s groundnut exports in 2015, directly linked to the enforcement of aflatoxin standards.⁸ Awareness of mitigation technologies, such as biological control (Aflasafe), timely harvesting, and proper drying and handling, remains limited.⁸

Regarding input access, key informants have pointed to inadequate supplies of high-quality seeds and low rates of seed multiplication.⁸ The prevalent practice of using recycled seeds, often driven by the high cost of new, improved varieties, perpetuates low productivity levels.⁸

Market access is another significant hurdle, with farmers and traders struggling to reach lucrative and structured markets.⁸ Approximately half of groundnut-growing households operate under an “autarkic model,” producing primarily for self-consumption, using recycled seeds without additional inputs, and paying minimal attention to aflatoxin risks.⁸ Informal exports dominate, characterized by slow and infrequent aflatoxin testing.⁸ Conversely, firms aiming for formal export markets are compelled to vertically integrate their operations to maintain quality control, given the stringent aflatoxin standards imposed by importing countries.⁸

Policy and infrastructure issues further constrain the value chain. A lack of consultation with the private sector during the formulation of agricultural policies leads to an unpredictable regulatory environment.⁸ High electricity costs and frequent power outages severely impede processing operations, diminishing the competitiveness of Malawian groundnut products in regional and international markets.⁸

Despite these challenges, Malawi’s groundnut value chain presents notable opportunities. Its potential to contribute to agricultural diversification and trade is substantial, offering a pathway to move beyond traditional crops like maize and tobacco for both food and export purposes.⁸ There is an identified untapped export potential of approximately USD 25 million, targeting markets across Africa, Asia, and Europe.⁸ Groundnuts also play a vital role in

food security and soil health, serving as an important source of nutrition and improving soil fertility through nitrogen fixation.⁸ The

value chain has shown strong growth in recent years, evidenced by increasing production and planted areas, alongside high farmer participation rates.⁸

3.4. Senegal’s Groundnut Value Chain

The groundnut value chain in Senegal holds immense economic, social, and political significance.⁹ It serves as a primary source of income for a vast majority of family farms, occupying about half of the total cropped area and employing two-thirds of the rural population, many of whom live below the official poverty line.³ Groundnuts are cultivated by 27% of all households in Senegal, and notably by 52% of households experiencing extreme poverty.³

Historically, Senegal’s groundnut sector was developed under colonial authorities, who maintained a monopoly over exports to control the domestic market.⁹ The French-owned oil processor was eventually nationalized.⁹ However, since the 1980s, shifts in global trade dynamics, including changes in transport costs favoring whole nuts and a consumer preference shift away from groundnut oil (with soya and palm oil gaining prominence), led to a decline in global trade for groundnut products.³ While groundnut exports increased by 2.2% annually since the early 1980s, exports of groundnut oil and meal fell by 1% and 2.5% respectively, despite a general increase in global consumption of these products.³

Senegal, like much of Sub-Saharan Africa (SSA), struggled to adapt to these global trends, experiencing a drastic reduction in its share of international whole nuts trade from 17.4% in 1962-1964 to a mere 1% between 1992-2005 (SSA’s share dropped from 88.6% to 5.2% in the same period).³ This decline was largely attributable to inconsistent quality (stemming from seed quality and poor aflatoxin management), unreliable supply, a lack of adequate incentive frameworks for farmers to profitably engage in whole nut trade, and significant increases in production in Asia.³ For much of the 20th century, the Government of Senegal (GoS) restricted direct exporting of whole nuts, compelling farmers to sell at lower prices to industrial processors for export as oil and cake.³ As global demand for groundnut oil waned, these exports became increasingly unprofitable. In response, the GoS lifted its ban on whole nut exports in 2010, which led to a sharp rise in prices paid to producers and opened new opportunities for some of Senegal’s most impoverished farmers and rural entrepreneurs, who subsequently expanded production, storage, and transport activities.³

Despite these positive policy shifts, the full value of whole nut exports is not yet fully realized by farmers.³ This is largely due to a substantial burden of implicit taxation designed to protect the domestic oilseed industry, which in turn diminishes groundnut production and erodes incentives for further investment in the sector.³ Transfers and losses along the current value chain amount to 24-32% of farmers’ current revenues.³ These losses are primarily due to the historical protection of SONACOS (a nationalized oil processor) and the limited entry of competing small and medium enterprises capable of offering farmers access to low-cost transport, storage, and marketing options.³

All four types of farming systems examined in Senegal demonstrate profitability, with revenues significantly exceeding costs. Profitability ranges from 27% for less competitive cooperatives involved in seed production to 72% for highly profitable irrigated off-season selling systems.³

Common Themes & Cross-Cutting Challenges in African Groundnut Value Chains

Across Ghana, Kenya, Malawi, and Senegal, several common challenges and themes emerge, highlighting systemic issues that impede the full development of the groundnut value chain in Africa:

Aflatoxin Contamination: This is a pervasive and critical issue across all examined countries.¹ It poses significant health risks, leads to substantial economic losses due to rejected exports, and limits access to higher-value international markets. The problem is exacerbated by poor post-harvest handling, storage, and limited awareness of mitigation technologies.
Low Productivity and Input Access: African groundnut yields are consistently lower than other continents.⁵ This is primarily due to extensive farming practices, heavy reliance on rain-fed agriculture, and limited adoption of improved seed varieties and fertilizers.¹ The high cost and inadequate supply of certified inputs further constrain productivity.¹
Market Access and Power Imbalances: Smallholder farmers frequently face limited access to structured and lucrative markets.⁴ The value chain is often atomistic, with numerous small producers and processors, but dominated by a few powerful aggregators and distributors who capture a larger share of the value.¹ This leads to low farmer margins and an unpredictable pricing environment.²
Informal Sector Constraints: A large portion of processing and trading occurs within the informal sector, often by micro and small-scale enterprises, predominantly led by women.¹ These enterprises typically lack access to formal financing, modern processing techniques, and adequate storage facilities, limiting their capacity for growth and quality improvement.¹
Gender Disparities: While women play a central and often dominant role in groundnut production, processing, and trading, they frequently face unequal access to resources, land rights, and decision-making opportunities.¹ This limits their ability to invest in improvements and fully benefit from their labor.
Infrastructure and Policy Gaps: Inadequate transport networks, high energy costs, and insufficient storage facilities contribute to post-harvest losses and increased operational costs.¹ Policy environments can be unpredictable, with a lack of private sector consultation and implicit taxation mechanisms that disincentivize investment and farmer profitability.³

4. Global Market for Groundnut Value Chain Products

The global market for groundnuts and their derived products is dynamic, influenced by production trends, trade policies, and evolving consumer preferences.

4.1. Global Peanut Production and Trade Dynamics

Global peanut production averaged 46.4 million metric tons (MMT) between 2016 and 2020.¹⁰ Five countries collectively account for two-thirds of this total production: China, India, Nigeria, the United States, and Sudan.¹⁰ China is the largest producer, averaging 17 MMT during this period, representing over one-third of the world’s groundnuts.¹⁰

In terms of exports, the global market averaged 3,573 thousand metric tons (TMT) from 2016-2018, rising to 4,687 TMT in 2019, before a slight decrease to 4,256 TMT in 2020.¹⁰ Argentina, India, the United States, and China collectively account for approximately 75% of global peanut exports over the past five years.¹⁰ Notably, Senegal is emerging as a significant competitor, having doubled its annual exports since 2016 and now holding nearly 10% of the peanut export market.¹⁰

Global peanut imports saw a significant increase in 2019.¹⁰ China, surprisingly, led the world in imports in 2019 with 1,350 TMT, though this figure decreased to 1 MMT in 2020.¹⁰ This surge in Chinese imports was driven by higher domestic demand for peanut meal for animal feed and oil for food, while local production remained relatively stable.¹⁰ Prior to 2019, the European Union (EU) was the largest import market, averaging 925 TMT annually.¹⁰ Other major importers include Indonesia, Mexico, and Russia.¹⁰

Trade barriers significantly impact global peanut trade. Tariffs are a primary impediment; while Mexico and Canada impose zero tariffs on U.S. peanuts, the EU levies a 25% tariff on shelled peanuts (with no tariff on in-shell).¹⁰ Due to trade disputes, China has increased tariffs on U.S. in-shell and shelled peanuts to 25% and 40% respectively.¹⁰ Indonesia applies a 5% tariff on U.S. peanuts but has no tariffs on Indian peanuts due to a trade agreement and geographical proximity.¹⁰ Beyond tariffs, phytosanitary certificates (PC) and import permits (IP) are often required. Mexico, China, and Indonesia mandate PCs for U.S. peanuts, with China also requiring an IP.¹⁰ All countries also enforce allergen labeling mandates for peanut-containing shipments.¹⁰

The global trade landscape for peanuts is undergoing a notable transformation, driven by shifting demand and supply dynamics. China’s dual role as a leading producer and, more recently, a major importer, particularly in 2019, represents a significant market rebalancing. This increased Chinese import activity, influenced by domestic demand for feed and food oil, has altered traditional trade flows.¹⁰ Concurrently, the EU, historically the largest import market, has seen its position challenged by China’s surge.¹⁰ The emergence of Senegal as a growing exporter further diversifies the supply side, introducing new competitive dynamics.¹⁰ These shifts, combined with the impact of various trade barriers such as tariffs and phytosanitary requirements, create a complex environment that necessitates strategic adaptation for all participants in the global groundnut market. Understanding these evolving relationships is crucial for identifying new market opportunities and navigating potential trade challenges.

4.2. Global Peanut Oil Market

The global peanut oil market is experiencing steady expansion, driven by evolving consumer preferences and product diversification. The market was valued at USD 11.30 billion in 2025 and is projected to reach USD 12.76 billion by 2030, demonstrating a Compound Annual Growth Rate (CAGR) of 2.46%.¹¹ Another estimate places the market at USD 10.43 billion in 2023, growing to USD 14.14 billion by 2030 at a CAGR of 4.5%.¹² Asia Pacific currently holds the largest market share, while Europe is identified as the fastest-growing market.¹¹

Key trends shaping the peanut oil market include the dominance of refined peanut oil, which held 78.01% of the market share in 2024. Its neutral flavor profile and high smoke point make it highly suitable for cooking and food processing.¹¹ However,

unrefined variants, particularly cold-pressed and organic oils, are projected to grow at a faster CAGR of 6.5% to 2030, driven by increasing consumer demand for minimally processed products that retain natural flavors, nutrients, and antioxidants.¹¹ The

organic segment is expanding at a 7.21% CAGR through 2030, appealing to health-conscious consumers seeking clean-label products.¹¹ In terms of

packaging, bottles held the largest revenue share (55.30% in 2024), while pouches are gaining momentum due to cost efficiency, convenience, and sustainability.¹¹ The

foodservice industry (HoReCa) segment maintains a significant market share (51.34% in 2024) due to consistent bulk purchasing and the oil’s performance in commercial food preparation.¹¹ Asia-Pacific commanded 62.50% of the market share in 2024, anchored by extensive culinary usage in India and China.¹¹

The market’s growth is primarily driven by several factors. Rising health awareness boosts demand for peanut oil due to its heart-healthy properties, being cholesterol-free and rich in monounsaturated fats.¹¹ The oil’s

high smoke point and neutral flavor make it a preferred choice for high-temperature cooking.¹¹ Increasing demand for

organic and non-GMO oils further fuels consumption.¹¹ The substantial

expansion of the foodservice industry globally drives significant demand for bulk peanut oil.¹¹ Additionally,

technological advancements in oil extraction improve quality and yield, and the growth of the food processing industry contributes to demand.¹¹

However, the market faces restraints, primarily competition from alternative edible oils like sunflower, soybean, and canola oils, which may offer similar benefits at competitive prices.¹¹

Concerns about peanut allergies also limit the potential consumer base, especially in developed markets, necessitating strict labeling requirements.¹¹ Seasonal and climatic risks can affect production consistency, and elevated production expenses can impact competitiveness.¹¹

Major players in the peanut oil market include Wilmar International Limited, Archer Daniels Midland Company (ADM), Cargill, Incorporated, and Tata Consumer Products Limited, among others.¹¹ These companies focus on sustainability, advanced technologies, and geographic expansion.¹¹

The global peanut oil market’s trajectory is significantly shaped by evolving consumer preferences for healthier, natural, and convenient products. The increasing awareness of peanut oil’s heart-healthy properties, coupled with a rising demand for organic and non-GMO variants, is a clear indication of a market shift towards health-conscious consumption.¹¹ This trend extends to packaging, where the growing preference for convenient pouches reflects a broader consumer desire for ease of use and efficiency.¹¹ Furthermore, the expansion of the foodservice industry, particularly in Asia-Pacific, demonstrates how the demand for bulk, high-performance cooking oils is driving market growth.¹¹ These interconnected factors illustrate how consumer values around health, convenience, and sustainability are not merely niche preferences but are actively reshaping product development, distribution strategies, and overall market dynamics within the peanut oil sector.

4.3. Global Market for Other Groundnut Products

Beyond oil, groundnuts are widely utilized in various food applications, including snacks, bakery items, and as a source of protein.¹³ The global peanuts market, encompassing all forms and applications, was valued at USD 90.05 billion in 2023 and is projected to reach USD 109.29 billion by 2032, with a CAGR of 2.14% from 2024 to 2032.¹³ Another estimate places the market at USD 92.77 billion in 2025, reaching USD 105.47 billion by 2030, with a CAGR of 2.6%.¹⁴ This growth is largely driven by increasing health consciousness among consumers and the rising demand for peanut-based products.¹³ Asia-Pacific holds the largest market share, while North America is expected to be the fastest-growing region.¹³

Peanut Butter: The global peanut butter market was valued at USD 4.77 billion in 2021 and is projected to reach USD 7.19 billion by 2029, exhibiting a robust CAGR of 6.60% during the forecast period.¹⁵ Its growing popularity is attributed to its low-calorie and high-protein content, making it a favored substitute for other spreads, particularly among health-conscious consumers.¹⁵ The “food-on-the-go” trend further fuels demand for readily available nutritious food products like peanut butter.¹⁵ North America dominates this market due to rising disposable incomes and the presence of major players.¹⁵ Key players include Unilever, The J.M. Smucker Company, and The Kraft Heinz Company.¹⁵

Roasted Peanuts: The “roasted” form is a significant segment within the broader peanuts market, though the “raw” form dominated in 2022 due to its wide use in the food and beverage industry.¹³ The growth in demand for roasted peanuts is fueled by their high nutritional value and increasing health awareness among consumers.¹³ Peanuts are consumed as whole nut snacks and as components in desserts and sauces.¹³

Peanut Meal (Animal Feed): Peanut meal is a crucial by-product of oil extraction and is widely used in animal feed.² The global peanut meal market was valued at USD 5,644.20 million in 2024 and is projected to reach USD 7,786.55 million by 2031, growing at a CAGR of 4.7%.¹⁶ Another estimate places the market at USD 6.21 billion in 2024, growing to USD 8.91 billion by 2034 at a CAGR of 3.7%.¹⁷ The animal feed segment is the most prominent application, valued at USD 2.7 billion in 2023 and projected to reach USD 3.6 billion by 2032, due to its high nutritional value.¹⁷ Peanut meal is widely used for ruminants (nearly 35% of demand), poultry (over 40% of usage), swine (around 15%), and aquaculture (about 7%).¹⁶ Its high digestible protein content and cost-efficiency make it a preferred choice, often replacing more expensive ingredients like soybean meal.¹⁶ However, careful inclusion rates are required for swine due to potential aflatoxin contamination.¹⁶ Pelleted peanut meal accounts for nearly 50% of the market due to ease of handling and storage.¹⁶ Asia-Pacific is a significant player in the peanut meal market, with North America, Europe, South America, and the Middle East & Africa also showing substantial valuations.¹⁷

The market for diverse groundnut products is being significantly shaped by the increasing demand for protein-rich, convenient, and plant-based foods. The robust growth observed in the overall peanuts market, alongside specific segments like peanut butter and peanut meal, underscores a broader shift in consumer dietary patterns and lifestyles.¹³ The rising popularity of peanut butter as a low-calorie, high-protein spread, driven by health-conscious consumers and the “food-on-the-go” trend, exemplifies how convenience and nutritional value are becoming key purchasing drivers.¹⁵ Similarly, the substantial and growing market for peanut meal in animal feed reflects the agricultural sector’s need for cost-effective, high-protein feed alternatives.¹⁶ These trends collectively indicate that the groundnut industry’s future growth is intrinsically linked to its ability to diversify products and cater to evolving consumer demands for healthy, convenient, and sustainably sourced protein options, extending its utility far beyond traditional uses.

5. Policy and Initiatives for Groundnut Value Chain Development in Africa

The development of a robust and competitive groundnut value chain in Africa is heavily reliant on supportive policy frameworks and strategic initiatives at national, regional, and continental levels.

Regional Policies and Frameworks

Regional economic communities and continental bodies play a crucial role in shaping the agricultural landscape for groundnuts.

ECOWAS (Economic Community of West African States): ECOWAS aims to promote cooperation and integration to improve living standards and foster economic stability in West Africa.¹⁸ Its regional agricultural policy, ECOWAP, seeks to sustainably meet food needs, promote economic and social development, and reduce poverty.¹⁸ Groundnuts are considered a strategic agricultural raw material within the region due to their importance in diets and sub-regional market connections.¹⁸ ECOWAP prioritizes the organization and structuring of regional value chains, focusing on collection, marketing, processing, storage, preservation, packaging, and distribution.¹⁸ It emphasizes institutional issues, technology, quality standards, traceability, and financing for economic agents, aiming to concentrate private sector investment in processing and distribution.¹⁸ Ghana, for instance, supports ECOWAS’s push for a maximum residue limit (MRL) of aflatoxin in peanuts at 10 ppb, a standard it adopted nationally in 2018.⁷ This move is driven by the need to protect trade interests and avoid rejections of exports, particularly to the EU, which has issued numerous alerts regarding high aflatoxin levels in Ghanaian peanut products.⁷
African Union (AU) / CAADP (Comprehensive Africa Agriculture Development Programme): The AU, in collaboration with the New Partnership for Africa’s Development (NPCA) and Regional Economic Communities (RECs), facilitates the implementation of strategies under CAADP to boost agriculture and nutrition.¹⁹ The overarching goal is to increase food production and accessibility, enabling Africa to achieve food self-sufficiency and become an exporter, while reducing drought-triggered food crises.¹⁹ The AU Commission also develops strategies to promote value addition of Africa’s raw materials through agro-processing and market development.¹⁹ CAADP specifically promotes the generation and dissemination of knowledge, innovation, and technology for agricultural transformation, including rural infrastructure development and value addition. It advocates for achieving the goal of allocating 10% of national budgets to agriculture.¹⁹
AfCFTA (African Continental Free Trade Area): Launched in 2018, with trade commencing in 2021, AfCFTA is the world’s largest free trade area by participating countries (54 of 55 African Union nations).²⁰ Member states are required to remove 90% of tariffs on tradable goods and services to facilitate free intra-African trade.²⁰ Malawi, for instance, ratified the AfCFTA agreement in 2021, recognizing the potential for groundnuts to contribute to its export earnings under this framework.²⁰ The agreement presents significant opportunities for agricultural transformation, job creation, and economic growth by addressing challenges that have historically rendered African agricultural value chains uncompetitive, such as deficient infrastructure, policy incoherence, and low investment.²⁰ Policy suggestions to leverage AfCFTA include subsidizing farm inputs, particularly legume seeds, ensuring widespread access to finance, reducing transport costs through improved connectivity, and implementing attractive taxation systems.²⁰

Historical Initiatives (e.g., Tanganyika Groundnut Scheme)

Historical attempts at large-scale groundnut cultivation in Africa offer valuable lessons. The Tanganyika Groundnut Scheme, launched in 1946 by the British Labour Party, aimed to produce urgently needed oilseeds on 3 million acres in Tanganyika (now Tanzania) to increase margarine supplies in post-WWII Britain.²¹ Despite an enormous effort and an expenditure of £36 million (over £1 billion in 2020 equivalent), the project was a catastrophic failure and was abandoned in 1951.²¹

The scheme’s proponents overlooked critical warnings regarding unsuitable environmental conditions, inadequate rainfall, and poor communications.²¹ Disastrous project management, initially by the United Africa Company and later by the government-run Overseas Food Corporation, led to it being widely perceived as a symbol of government incompetence in late colonial Africa.²¹ The original target of 3 million acres was drastically reduced, and ultimately only 47,000 acres were cleared.²¹ Challenges included difficulty in obtaining heavy land-clearing equipment, logistical bottlenecks at ports and railways, and formidable natural obstacles like resilient baobab trees and local wildlife.²¹ The scheme’s primary function was to alleviate Britain’s fats shortage and dollar deficit, with colonial development being a subordinate goal.²² This monumental failure underscores the arrogance of British post-war colonial development and the exploitative, contradictory nature of capitalist society in its approach to resource extraction.²²

Effective policy frameworks and robust regional integration are indispensable for overcoming structural barriers, improving competitiveness, and leveraging the significant export potential of African groundnut value chains. The historical failures, such as the Tanganyika Groundnut Scheme, starkly illustrate the perils of top-down, externally driven initiatives that disregard local environmental realities, community structures, and market dynamics.²¹ In contrast, contemporary initiatives under ECOWAS, the AU’s CAADP, and AfCFTA demonstrate a recognition of the need for internal capacity building, value addition, and enhanced intra-African trade.¹⁸ By fostering an environment that supports local farmers, addresses critical quality issues like aflatoxin contamination through harmonized standards, and facilitates access to finance and modern technologies, these policies can enable African nations to transition from raw commodity exporters to producers of high-value, processed groundnut products. This strategic shift is crucial for capturing a greater share of the global market, enhancing food security, and driving sustainable economic growth across the continent.

6. Conclusions and Recommendations

The groundnut value chain is a critical component of global agriculture and holds immense, yet often unrealized, potential for economic development and food security in African nations. The analysis reveals a complex interplay of production, processing, trade, and consumption dynamics, characterized by significant disparities in productivity and value capture.

Key Conclusions:

Untapped African Potential: Despite Africa’s substantial land area dedicated to groundnut cultivation, its average yields are significantly lower than other continents. This indicates a considerable opportunity for increasing production through improved agricultural practices, technology adoption, and access to quality inputs.
Farmer Disadvantage and Power Imbalance: Smallholder farmers, who form the backbone of groundnut production, consistently receive a disproportionately small share of the final consumer value. Distributors and aggregators often dominate the value chain, benefiting from informational and logistical advantages, which limits farmers’ income and their capacity for reinvestment.
Pervasive Quality Challenges (Aflatoxin): Aflatoxin contamination is a widespread and severe issue across African groundnut value chains. It poses significant public health risks, leads to substantial economic losses due to export rejections, and restricts access to high-value international markets. Effective mitigation strategies are often lacking or poorly implemented.
Value Addition as a Growth Catalyst: Primary processing activities, such as de-shelling and initial grading at the farmer or Farmer Producer Company (FPC) level, have been shown to significantly increase farmer margins and reduce risk. This highlights the importance of moving beyond raw commodity sales to capture more value within the chain.
Evolving Global Market Dynamics: The global market for groundnuts and their products is influenced by shifting trade patterns, with China emerging as a major importer alongside its production, and new exporting regions like Senegal gaining prominence. Consumer preferences for healthier, convenient, and plant-based products are driving demand for diversified groundnut derivatives, including peanut oil, peanut butter, and peanut meal.
Policy and Regional Integration Imperative: Effective national policies and robust regional frameworks, such as ECOWAP, CAADP, and AfCFTA, are crucial for addressing structural barriers, enhancing competitiveness, and leveraging intra-African trade opportunities. Historical lessons, like the Tanganyika Groundnut Scheme, underscore the need for context-sensitive, inclusive, and locally-driven development approaches.

Recommendations:

Enhance Farmer Productivity and Value Capture:
- Invest in Quality Inputs and Extension: Facilitate widespread access to affordable, improved groundnut seed varieties and appropriate fertilizers. Strengthen agricultural extension services to disseminate knowledge on good agricultural practices, including pest and disease management, and climate-resilient farming techniques.
- Promote Farmer-Led Value Addition: Support the establishment and strengthening of Farmer Producer Companies (FPCs) and Farmer-Controlled Service Centers (FCSCs) equipped with de-shelling, grading, and basic packaging facilities. This empowers farmers to capture higher margins and reduces post-harvest losses.
- Improve Market Linkages: Develop and promote structured markets and direct market linkages to reduce the influence of intermediaries and ensure fairer prices for farmers. Implement market information systems to provide farmers with timely and accurate price data.
Combat Aflatoxin Contamination Systematically:
- Implement Integrated Aflatoxin Management: Scale up the adoption of pre- and post-harvest aflatoxin mitigation technologies, including biological control agents (e.g., Aflasafe), timely harvesting, proper drying techniques, improved storage facilities, and effective sorting.
- Strengthen Quality Standards and Enforcement: Harmonize national and regional aflatoxin standards in line with international benchmarks (e.g., 10 ppb MRL), and invest in laboratory testing infrastructure and capacity for consistent enforcement.
- Raise Awareness: Conduct extensive awareness campaigns among farmers, processors, and consumers about the health risks of aflatoxin and best practices for prevention.
Foster Inclusive Processing and Trade:
- Support Small and Medium Enterprises (SMEs): Provide targeted financial support, technical training, and access to modern, energy-efficient processing technologies for micro and small-scale processors, particularly women-led enterprises, to improve product quality and efficiency.
- Leverage Regional Trade Agreements: Actively utilize frameworks like the AfCFTA to reduce trade barriers, facilitate the free movement of groundnut products across African borders, and create larger, more integrated regional markets.
- Diversify Product Portfolio: Encourage investment in the production of high-demand value-added products beyond oil, such as peanut butter, roasted snacks, and specialized flours, to cater to evolving global and regional consumer preferences.
Strengthen Policy and Governance:
- Develop Coherent Agricultural Policies: Ensure agricultural policies are predictable, transparent, and developed in close consultation with private sector stakeholders and farmer organizations.
- Address Implicit Taxation and Incentives: Review and reform policies that implicitly tax groundnut producers or disproportionately benefit specific industries, ensuring a fair and attractive incentive framework for investment across the value chain.
- Invest in Infrastructure: Prioritize investments in rural road networks, reliable energy supply, and modern storage facilities to reduce transport costs, minimize post-harvest losses, and enhance overall value chain efficiency.

By implementing these strategic recommendations, African nations can transform their groundnut value chains into more competitive, equitable, and sustainable systems, ultimately contributing significantly to rural prosperity and regional food security.