Market Prospects for Groundnut in West Africa COMMON FUND ...

Table 2. Transaction costs analysis.
2.3 Conclusions
Faced with competition from other oilseed crops and increased demand for
edible groundnut (on a global scale as well as within West Africa), market
trends favor a diversity of market applications, including oilseed and edible
nuts (ARB).
Oilseed and meal
As an oilseed and meal crop, groundnut has steadily lost ground to its main
competitors, cottonseed and soya, and there is no immediate prospect of a
reversal of this trend. However, despite a largely unremunerative market for
producers, comparative advantages of groundnut are the existence of wellestablished
formal and informal market outlets and steady (mostly unmet)
industrial demand, as well as the significance of groundnut in the West African
diet, which is not the case for cottonseed or soya.
Cottonseed represents a by-product of a more remunerative crop than
groundnut, and as such, it is well-positioned to compete as an oilseed. As meal
10
Percentage of total transaction cost
Transaction Cost Domestic Export
Sack 16% 3%
Market tax 0.08% -
Storage 9% 2%
Loaders - 38%
Vehicle 73% 17%
Subtotal transport 73% 55%
Percentage of average product value
Transaction Cost Domestic Export
Sack 1% 1%
Market tax 0.05% 0.05%
Storage 0.60% 0.60%
Loaders - 10%
Vehicle 4% 4%
Subtotal transport 4% 14%