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

according to European aflatoxin standards. Of the lots certified as ‘aflatoxinfree’
by the USDA during that year – purchased at a premium of $30-40 per
ton by a Dutch importing company – about 60% were subsequently found to
exceed EU standards for aflatoxin. In that year, only the southwestern US
production areas could supply aflatoxin-free Virginia and Runner grades in
shells.
3.4 Argentina
Argentina accounts for over 16% of world shelled groundnut exports over the
past decade, making it the third largest exporter of shelled groundnut.
Approximately 28.3% of the Argentine crop was exported in 2001.
Argentine origin is considered ‘the first replacement’ for US origin.
Argentine groundnut is commonly priced between $600 and $900 per ton;
prices are largely determined by the US groundnut crop and Argentina
provides an important ‘backup’ supply for the US domestic market.
Given its extensive domestic requirements of about 43,000 MT per year
as well as its international quality profile, world demand for Argentine
groundnut commonly exceeds available supply, and contracts may thus be
made far in advance. However, this is not to say that aflatoxin is not a problem
in Argentina – it certainly proved so in 1999 – and even (competitively-priced)
China can compete quite favorably with Argentina in terms of product quality.
The 2001 national economic crisis had severe consequences for
Argentine groundnut exporters, despite a good harvest and a clean crop.
Export duties of 10% were enforced (and remain in place today), which –
together with the cancellation of the 5% export subsidy – led to a total 15%
net reduction in income. Even the devaluation of the Argentine peso to the
dollar could not mitigate the damage, as many Argentine exporters hold
investment loans in US dollars, and could thus not fully benefit from an
apparently beneficial exchange rate.
3.5 India
India supplied 9.1% of world shelled groundnut exports over the past decade,
and nearly 7% of in-shell exports as well. Price-wise, groundnut of Indian
origin is consistently below that of China, at the bottom of the ‘big four’
countries of origin, a reflection of what might charitably be called quality
concerns.
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