1

A PROFILE OF THE SOUTH AFRICAN GROUNDNUT MARKET VALUE CHAIN

2015

Directorate Marketing Tel 012 319 8455 Private Bag X 15 Fax 012 319 8131 Arcadia E-mailMogalaMdaffgovza 0007 wwwdaffgovza

2

TABLE OF CONTENTS

1 DESCRIPTION OF THE INDUSTRY 3

11 Producing Areas 4

12 Production Trends 5

3 MARKET STRUCTURE 5

21 Domestic Market and Prices 5

22 Exports 7

23 Share Analysis 15

2 4 Imports 17

25 Processing 20

26 Market Value Chain 23

3 Market Intelligence 24

31 Tariffs 24

32 Performance of the groundnut industry 26

4 ACKNOWLEDGEMENTS 31

3

1 DESCRIPTION OF THE INDUSTRY Groundnuts contribute approximately 11 to the gross value of field crops production The average annual gross value of groundnuts production for the previous ten years up to 201314 season amounts to approximately R 727 989 million Groundnuts can be consumed in an unprocessed state but they also serve in the economy as raw materials for the manufacturing of various products These include but not limited to the manufacturing of such products as peanuts peanut butter sweets and cooking oil The production of groundnuts is highly affected by the costs of production inputs as well as the demand for groundnuts The contribution of the groundnut industry to the gross value of agricultural production is summarized in Figure 1

Source Statistics and Economic Analysis

The gross value of groundnut production as shown in Figure 1 above was relatively low during 200405 season and this was followed by a slight decline in the gross value of groundnut production during 200405 season The contribution of the groundnut industry to the gross value of agricultural production was characterized by fluctuations throughout the period under analysis with some consistent increases between 200607 and 200809 seasons The gross value of production has reached the highest level during 201314 mainly as a result of relatively higher levels of production coupled with higher producer prices at the time The contribution of the groundnut industry to the GVP declined slightly between 200910 and 201011 seasons and this was followed by a slight increase during 201112 season The period under analysis closed with relatively higher gross value of groundnut production in 201314 season

0

100000

200000

300000

400000

500000

600000

700000

800000

R0

00

Years

Figure 1 Groungnuts Gross Value of Production

4

11 Producing Areas

Figure 2 below shows the contribution of each province to the total groundnuts production in South Africa The figure clearly indicates that the groundnuts are produced mainly in three provinces namely the North West (34) Free State (33) and Northern Cape Province (29) Groundnuts are also produced in Limpopo KwaZulu-Natal and Gauteng provinces although the production is lower in these provinces

Source Statistics and Economic Analysis

Table 1 Groundnut production by provinces

PROVINCE

Production (tons) 200708

Production (tons) 200809

Production (tons) 200910

Production (tons) 201011

Production (tons) 201112

Production (tons) 201213

Production (tons) 201314

Northern Cape

21500 31 000 27 120 18 950 16900 14000 18200

Free State

35 700 33 690 35 000 20 700 21800 16200 23500

Kwazulu-Natal

80 0 300 0 150 150 90

Limpopo 5 810 6 750 3 520 3 500 3350 1200 4110

North West

25 650 28 000 22 000 20 900 16800 10000 28500

Gauteng 60 60 60 0 0 0 0

Source Statistics and Economic Analysis

Table 1 indicates that during the past three years Free State Province has been the major producer of groundnuts even though groundnut production in this province has experienced considerable fluctuations during this period Northern Cape is the second largest producer of groundnuts after Free State However North West Province increased its production significantly during 200708 and surpassed Northern Capersquos production volumes Notably groundnut production in all the major producing regions has undergone a drastic decline during 201213 season leading to a slight decline in

Northern Cape 29

Free State 33

Kwazulu-Natal

0

Limpopo 4

Gauteng 0

North West 34

Figure 2 Groundnuts production by Provinces 201415

5

South Africarsquos total groundnuts production Gauteng Province has no recorded any groundnuts production volume from 201011 until 201314 Plantings and production trends of groundnuts from 200506 to 201415 production seasons are as depicted in Figure 3 below

Source Statistics and Economic Analysis

Figure 3 makes it clear that production volumes for groundnuts were at higher levels during the 200506 marketing season and this was followed by a slight decline in groundnuts production volumes during 200607 season During the 200506 season the production increased slightly followed by a slight decline in area planted for groundnuts during the 200607 season Despite only slight decrease in the area planted to groundnuts during 201011 season groundnuts production volumes declined significantly during that time indicating a slight decline in yields The period under analysis closed with relatively lower volumes of groundnut production despite a slight increase in area planted during 201314 season

3 MARKET STRUCTURE

21 Domestic Market and Prices

Figure 4 indicates the local production together with consumption of groundnut in South Africa Generally the production and consumption of groundnut fluctuated considerably throughout the period under analysis The figure indicates that the period under analysis opened with production of groundnuts being more than the consumption implying that there was enough groundnuts production and less consumption in South Africa in 200506 as indicated in the figure The figure also indicates

200405

200506

200607

200708

200809

200910

201011

201112

201213

201314

total area planted 40000 48550 40770 54200 52000 57000 55000 45000 47000 52000

production 72419 83734 65630 100481 113000 100000 73000 67000 47000 84000

0

20000

40000

60000

80000

100000

120000

0

10000

20000

30000

40000

50000

60000

Pro

du

ctio

n (

To

n)

Are

a P

lan

ted

(H

a)

Years

Figure 3 Production vs Total Area Planted

6

that between 200708 and 201112 production of groundnuts was more than the consumption of groundnuts The period under analysis closed with more production volume as compared to consumption volumes in 201415 season

Source Statistics and Economic Analysis The average producer prices for groundnuts from 200405 to 201314 season are as indicated in Figure 5 below

Source Statistics and Economic Analysis

Figure 5 shows that producer prices for groundnuts were very low during the opening season of the period under analysis (200405) Generally the figure indicate fluctuating trend of groundnut producer

0

20000

40000

60000

80000

100000

120000

To

ns

Period (Years)

Figure 4 Local Groundnuts Production vs Consumption

Groundnuts production Groundnuts consumption

200405

200506 200607 200708 20080

9 20091

0 201011

201112

201213 201314

price 246421 284911 551438 61221 636069 465965 514154 828726 875587 823867

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Pri

ce (

RT

on

)

Period (Years)

Figure 5 Producer prices for Groundnuts

7

price This was followed by gradual increase in groundnuts producer price between 200506 and 200809 The figure indicates that the period under analysis closed with slightly lower producer prices for the product in 20131 season (R8 23867ton) Figure 6 shows the utilization of groundnuts in South Africa from 200506 to 201415 The figure shows that groundnuts in South Africa are utilized mainly for manufacturing peanut butter for sales as raw peanuts to the direct market for oil and oilcake and for seed The figure further indicates that groundnut is mainly used for peanut butter and direct market as compared to the use for oil amp oilcake and seed On average 2 235tons of groundnuts are sold for crushing into oil and oilcake in the domestic market while 3 185 tons are directed to the animal feed and seed markets

Source Statistics and Economic Analysis

22 Exports

The volume and value of groundnuts exports from South Africa to the world are summarized in Figure 7 below Figure 7 indicates volume and value of groundnuts exports from 2005 to 2014 The figure indicates that throughout the period under analysis the quantity of groundnuts exports were consistent with the value of groundnuts exports The period under review opened with moderate volume of groundnuts exports On average 19 670 tons were exported at the value of 149 million The figure further indicates that exports of groundnuts fluctuated considerably over the period under analysis The highest volume of groundnuts exports were recorded in 2005 (50571 tons) and the lowest was recorded in 2010 (12541 tons)

0

10000

20000

30000

40000

50000

60000

70000

200506 200607 200708 200809 200910 201011 201112 201213 201314 201415

Vo

lum

e (

Ton

s)

Marketing Years

Figure 6 Utilization of Groundnuts in the domestic market

Oil and Oilcake Peanut butter and direct edible market Seed and Unshelled

8

Source Statistics amp Economic Analysis and Quantec Easydata

South Africa imports its groundnuts from countries such as Mozambique Malawi Argentina China and India as shown in Figure 8

Source ITC Trade Map

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

30000

35000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R0

00)

Exp

ort

Vo

lum

es (

To

ns)

Period (Years)

Figure 7 Volume and Value of Groundnuts exports 2005-2014

Export Quantity (tons) Export Value (Rands)

Mozambique 57

China 10

Malawi 28

Argentina 5

Figure 8 Export of Groundnuts to RSA in 2014

9

Figure 8 below shows exporters of groundnuts to the Republic of South Africa during the year 2014 The figure indicates that Mozambique is the largest exporters of groundnuts into South African markets followed by Malawi China and Argentina in 2014 During the same year Mozambique accounted for about 57 of the total groundnuts imported by South Africa followed by Malawi (28 ) and China with 10 Argentina contributed 5 towards South Africarsquos total groundnut imports

Source Quantec Easy data

Figure 9 indicates volume of groundnuts exports to various regions in the world The figure indicates that South Africa exports mainly to Europe Asia and Africa The figure also indicates that volumes of groundnuts exports to America and Oceania are less than 400 tons of groundnuts per year Figure 9 shows that groundnut exports from South Africa are destined for the markets in Europe Asia Africa the Americas and Oceania The figure indicates that exports to Europe and Asia are more than those destined to neighboring countries to South Africa within the African continent which is not surprising as most countries in Africa are involved mostly in primary agricultural production than in processing Generally the volume of groundnuts exports to Europe started to decline from 2006 until 2007 followed by slight increases between 2008 and 2010 Exports to Asia fluctuated at moderate levels from the year 2005 until some increases were experienced in 2008 The period under review closed with larger volumes of groundnuts exports being destined to Africa followed by Europe Figure 10 indicates exports of groundnuts to European Union from 2005 to 2014 The exports of groundnuts to this region were fluctuating throughout the period under analysis The figure indicates that the South African groundnuts exports over the period under review were destined mainly to Netherlands United Kingdom and Germany Exports to Belgium remained minimal The period under analysis closed with Netherlands at a low volume of groundnuts originating from South Africa

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Africa 1916 1358 1070 1937 2033 8324 4022 882 2329 3684

Americas 0 0 60 0 186 18 396 90 0 0

Asia 9022 7208 4645 7497 4542 7506 4832 3904 2562 2705

Europe 9241 3722 2700 4664 4655 13280 7312 5514 3856 3164

Oceania 396 252 198 386 216 162 324 144 144 126

0

2000

4000

6000

8000

10000

12000

14000

Exp

ort

Vo

lum

e (

ton

s)

period (Years)

Figure 9 Volume of groundnuts exports to various regions

Africa Americas Asia Europe Oceania

10

Source Quantec Easy data

Figure 11 presents exports of groundnuts to Eastern Asia from 2005 to 2014 The figure indicates that in Eastern Asia South Africa exports groundnuts mainly to Japan The figure further indicates that exports of groundnuts to China and Hong Kong were very low and erratic during period under analysis As depicted in Figure 11 below exports of groundnuts from South Africa to Eastern Asia have generally been declining from 2005 until the year 2014 mainly because Japan who is the major importer of groundnuts from South Africa in Eastern Asia substituted imports from South Africa with those from Argentina and Brazil

Source Quantec Easy data

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Belgium 54 36 0 130 98 79 0 0 0 540

Finland 58 0 0 470 114 288 234 122 79 72

United Kingdom 2108 486 348 703 90 2206 531 0 0 286

Netherlands 3513 1385 1250 2513 3451 8713 5326 5159 3402 2086

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 10 Volume of groundnuts exports to the European Union

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 0 0 0 18 0 0 0 0 0 0

Japan 902196 71202 4608 74784 4434 60296 465175 38678 256219 263793

Hong Kong 0 0 0 0 0 0 1806 0 0 0

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (t

on

s)

Period (Years)

figure 11 Volume of groundnuts exports to Eastern Asia

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

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lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

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10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

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es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

2

TABLE OF CONTENTS

1 DESCRIPTION OF THE INDUSTRY 3

11 Producing Areas 4

12 Production Trends 5

3 MARKET STRUCTURE 5

21 Domestic Market and Prices 5

22 Exports 7

23 Share Analysis 15

2 4 Imports 17

25 Processing 20

26 Market Value Chain 23

3 Market Intelligence 24

31 Tariffs 24

32 Performance of the groundnut industry 26

4 ACKNOWLEDGEMENTS 31

3

1 DESCRIPTION OF THE INDUSTRY Groundnuts contribute approximately 11 to the gross value of field crops production The average annual gross value of groundnuts production for the previous ten years up to 201314 season amounts to approximately R 727 989 million Groundnuts can be consumed in an unprocessed state but they also serve in the economy as raw materials for the manufacturing of various products These include but not limited to the manufacturing of such products as peanuts peanut butter sweets and cooking oil The production of groundnuts is highly affected by the costs of production inputs as well as the demand for groundnuts The contribution of the groundnut industry to the gross value of agricultural production is summarized in Figure 1

Source Statistics and Economic Analysis

The gross value of groundnut production as shown in Figure 1 above was relatively low during 200405 season and this was followed by a slight decline in the gross value of groundnut production during 200405 season The contribution of the groundnut industry to the gross value of agricultural production was characterized by fluctuations throughout the period under analysis with some consistent increases between 200607 and 200809 seasons The gross value of production has reached the highest level during 201314 mainly as a result of relatively higher levels of production coupled with higher producer prices at the time The contribution of the groundnut industry to the GVP declined slightly between 200910 and 201011 seasons and this was followed by a slight increase during 201112 season The period under analysis closed with relatively higher gross value of groundnut production in 201314 season

0

100000

200000

300000

400000

500000

600000

700000

800000

R0

00

Years

Figure 1 Groungnuts Gross Value of Production

4

11 Producing Areas

Figure 2 below shows the contribution of each province to the total groundnuts production in South Africa The figure clearly indicates that the groundnuts are produced mainly in three provinces namely the North West (34) Free State (33) and Northern Cape Province (29) Groundnuts are also produced in Limpopo KwaZulu-Natal and Gauteng provinces although the production is lower in these provinces

Source Statistics and Economic Analysis

Table 1 Groundnut production by provinces

PROVINCE

Production (tons) 200708

Production (tons) 200809

Production (tons) 200910

Production (tons) 201011

Production (tons) 201112

Production (tons) 201213

Production (tons) 201314

Northern Cape

21500 31 000 27 120 18 950 16900 14000 18200

Free State

35 700 33 690 35 000 20 700 21800 16200 23500

Kwazulu-Natal

80 0 300 0 150 150 90

Limpopo 5 810 6 750 3 520 3 500 3350 1200 4110

North West

25 650 28 000 22 000 20 900 16800 10000 28500

Gauteng 60 60 60 0 0 0 0

Source Statistics and Economic Analysis

Table 1 indicates that during the past three years Free State Province has been the major producer of groundnuts even though groundnut production in this province has experienced considerable fluctuations during this period Northern Cape is the second largest producer of groundnuts after Free State However North West Province increased its production significantly during 200708 and surpassed Northern Capersquos production volumes Notably groundnut production in all the major producing regions has undergone a drastic decline during 201213 season leading to a slight decline in

Northern Cape 29

Free State 33

Kwazulu-Natal

0

Limpopo 4

Gauteng 0

North West 34

Figure 2 Groundnuts production by Provinces 201415

5

South Africarsquos total groundnuts production Gauteng Province has no recorded any groundnuts production volume from 201011 until 201314 Plantings and production trends of groundnuts from 200506 to 201415 production seasons are as depicted in Figure 3 below

Source Statistics and Economic Analysis

Figure 3 makes it clear that production volumes for groundnuts were at higher levels during the 200506 marketing season and this was followed by a slight decline in groundnuts production volumes during 200607 season During the 200506 season the production increased slightly followed by a slight decline in area planted for groundnuts during the 200607 season Despite only slight decrease in the area planted to groundnuts during 201011 season groundnuts production volumes declined significantly during that time indicating a slight decline in yields The period under analysis closed with relatively lower volumes of groundnut production despite a slight increase in area planted during 201314 season

3 MARKET STRUCTURE

21 Domestic Market and Prices

Figure 4 indicates the local production together with consumption of groundnut in South Africa Generally the production and consumption of groundnut fluctuated considerably throughout the period under analysis The figure indicates that the period under analysis opened with production of groundnuts being more than the consumption implying that there was enough groundnuts production and less consumption in South Africa in 200506 as indicated in the figure The figure also indicates

200405

200506

200607

200708

200809

200910

201011

201112

201213

201314

total area planted 40000 48550 40770 54200 52000 57000 55000 45000 47000 52000

production 72419 83734 65630 100481 113000 100000 73000 67000 47000 84000

0

20000

40000

60000

80000

100000

120000

0

10000

20000

30000

40000

50000

60000

Pro

du

ctio

n (

To

n)

Are

a P

lan

ted

(H

a)

Years

Figure 3 Production vs Total Area Planted

6

that between 200708 and 201112 production of groundnuts was more than the consumption of groundnuts The period under analysis closed with more production volume as compared to consumption volumes in 201415 season

Source Statistics and Economic Analysis The average producer prices for groundnuts from 200405 to 201314 season are as indicated in Figure 5 below

Source Statistics and Economic Analysis

Figure 5 shows that producer prices for groundnuts were very low during the opening season of the period under analysis (200405) Generally the figure indicate fluctuating trend of groundnut producer

0

20000

40000

60000

80000

100000

120000

To

ns

Period (Years)

Figure 4 Local Groundnuts Production vs Consumption

Groundnuts production Groundnuts consumption

200405

200506 200607 200708 20080

9 20091

0 201011

201112

201213 201314

price 246421 284911 551438 61221 636069 465965 514154 828726 875587 823867

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Pri

ce (

RT

on

)

Period (Years)

Figure 5 Producer prices for Groundnuts

7

price This was followed by gradual increase in groundnuts producer price between 200506 and 200809 The figure indicates that the period under analysis closed with slightly lower producer prices for the product in 20131 season (R8 23867ton) Figure 6 shows the utilization of groundnuts in South Africa from 200506 to 201415 The figure shows that groundnuts in South Africa are utilized mainly for manufacturing peanut butter for sales as raw peanuts to the direct market for oil and oilcake and for seed The figure further indicates that groundnut is mainly used for peanut butter and direct market as compared to the use for oil amp oilcake and seed On average 2 235tons of groundnuts are sold for crushing into oil and oilcake in the domestic market while 3 185 tons are directed to the animal feed and seed markets

Source Statistics and Economic Analysis

22 Exports

The volume and value of groundnuts exports from South Africa to the world are summarized in Figure 7 below Figure 7 indicates volume and value of groundnuts exports from 2005 to 2014 The figure indicates that throughout the period under analysis the quantity of groundnuts exports were consistent with the value of groundnuts exports The period under review opened with moderate volume of groundnuts exports On average 19 670 tons were exported at the value of 149 million The figure further indicates that exports of groundnuts fluctuated considerably over the period under analysis The highest volume of groundnuts exports were recorded in 2005 (50571 tons) and the lowest was recorded in 2010 (12541 tons)

0

10000

20000

30000

40000

50000

60000

70000

200506 200607 200708 200809 200910 201011 201112 201213 201314 201415

Vo

lum

e (

Ton

s)

Marketing Years

Figure 6 Utilization of Groundnuts in the domestic market

Oil and Oilcake Peanut butter and direct edible market Seed and Unshelled

8

Source Statistics amp Economic Analysis and Quantec Easydata

South Africa imports its groundnuts from countries such as Mozambique Malawi Argentina China and India as shown in Figure 8

Source ITC Trade Map

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

30000

35000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R0

00)

Exp

ort

Vo

lum

es (

To

ns)

Period (Years)

Figure 7 Volume and Value of Groundnuts exports 2005-2014

Export Quantity (tons) Export Value (Rands)

Mozambique 57

China 10

Malawi 28

Argentina 5

Figure 8 Export of Groundnuts to RSA in 2014

9

Figure 8 below shows exporters of groundnuts to the Republic of South Africa during the year 2014 The figure indicates that Mozambique is the largest exporters of groundnuts into South African markets followed by Malawi China and Argentina in 2014 During the same year Mozambique accounted for about 57 of the total groundnuts imported by South Africa followed by Malawi (28 ) and China with 10 Argentina contributed 5 towards South Africarsquos total groundnut imports

Source Quantec Easy data

Figure 9 indicates volume of groundnuts exports to various regions in the world The figure indicates that South Africa exports mainly to Europe Asia and Africa The figure also indicates that volumes of groundnuts exports to America and Oceania are less than 400 tons of groundnuts per year Figure 9 shows that groundnut exports from South Africa are destined for the markets in Europe Asia Africa the Americas and Oceania The figure indicates that exports to Europe and Asia are more than those destined to neighboring countries to South Africa within the African continent which is not surprising as most countries in Africa are involved mostly in primary agricultural production than in processing Generally the volume of groundnuts exports to Europe started to decline from 2006 until 2007 followed by slight increases between 2008 and 2010 Exports to Asia fluctuated at moderate levels from the year 2005 until some increases were experienced in 2008 The period under review closed with larger volumes of groundnuts exports being destined to Africa followed by Europe Figure 10 indicates exports of groundnuts to European Union from 2005 to 2014 The exports of groundnuts to this region were fluctuating throughout the period under analysis The figure indicates that the South African groundnuts exports over the period under review were destined mainly to Netherlands United Kingdom and Germany Exports to Belgium remained minimal The period under analysis closed with Netherlands at a low volume of groundnuts originating from South Africa

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Africa 1916 1358 1070 1937 2033 8324 4022 882 2329 3684

Americas 0 0 60 0 186 18 396 90 0 0

Asia 9022 7208 4645 7497 4542 7506 4832 3904 2562 2705

Europe 9241 3722 2700 4664 4655 13280 7312 5514 3856 3164

Oceania 396 252 198 386 216 162 324 144 144 126

0

2000

4000

6000

8000

10000

12000

14000

Exp

ort

Vo

lum

e (

ton

s)

period (Years)

Figure 9 Volume of groundnuts exports to various regions

Africa Americas Asia Europe Oceania

10

Source Quantec Easy data

Figure 11 presents exports of groundnuts to Eastern Asia from 2005 to 2014 The figure indicates that in Eastern Asia South Africa exports groundnuts mainly to Japan The figure further indicates that exports of groundnuts to China and Hong Kong were very low and erratic during period under analysis As depicted in Figure 11 below exports of groundnuts from South Africa to Eastern Asia have generally been declining from 2005 until the year 2014 mainly because Japan who is the major importer of groundnuts from South Africa in Eastern Asia substituted imports from South Africa with those from Argentina and Brazil

Source Quantec Easy data

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Belgium 54 36 0 130 98 79 0 0 0 540

Finland 58 0 0 470 114 288 234 122 79 72

United Kingdom 2108 486 348 703 90 2206 531 0 0 286

Netherlands 3513 1385 1250 2513 3451 8713 5326 5159 3402 2086

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 10 Volume of groundnuts exports to the European Union

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 0 0 0 18 0 0 0 0 0 0

Japan 902196 71202 4608 74784 4434 60296 465175 38678 256219 263793

Hong Kong 0 0 0 0 0 0 1806 0 0 0

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (t

on

s)

Period (Years)

figure 11 Volume of groundnuts exports to Eastern Asia

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

3

1 DESCRIPTION OF THE INDUSTRY Groundnuts contribute approximately 11 to the gross value of field crops production The average annual gross value of groundnuts production for the previous ten years up to 201314 season amounts to approximately R 727 989 million Groundnuts can be consumed in an unprocessed state but they also serve in the economy as raw materials for the manufacturing of various products These include but not limited to the manufacturing of such products as peanuts peanut butter sweets and cooking oil The production of groundnuts is highly affected by the costs of production inputs as well as the demand for groundnuts The contribution of the groundnut industry to the gross value of agricultural production is summarized in Figure 1

Source Statistics and Economic Analysis

The gross value of groundnut production as shown in Figure 1 above was relatively low during 200405 season and this was followed by a slight decline in the gross value of groundnut production during 200405 season The contribution of the groundnut industry to the gross value of agricultural production was characterized by fluctuations throughout the period under analysis with some consistent increases between 200607 and 200809 seasons The gross value of production has reached the highest level during 201314 mainly as a result of relatively higher levels of production coupled with higher producer prices at the time The contribution of the groundnut industry to the GVP declined slightly between 200910 and 201011 seasons and this was followed by a slight increase during 201112 season The period under analysis closed with relatively higher gross value of groundnut production in 201314 season

0

100000

200000

300000

400000

500000

600000

700000

800000

R0

00

Years

Figure 1 Groungnuts Gross Value of Production

4

11 Producing Areas

Figure 2 below shows the contribution of each province to the total groundnuts production in South Africa The figure clearly indicates that the groundnuts are produced mainly in three provinces namely the North West (34) Free State (33) and Northern Cape Province (29) Groundnuts are also produced in Limpopo KwaZulu-Natal and Gauteng provinces although the production is lower in these provinces

Source Statistics and Economic Analysis

Table 1 Groundnut production by provinces

PROVINCE

Production (tons) 200708

Production (tons) 200809

Production (tons) 200910

Production (tons) 201011

Production (tons) 201112

Production (tons) 201213

Production (tons) 201314

Northern Cape

21500 31 000 27 120 18 950 16900 14000 18200

Free State

35 700 33 690 35 000 20 700 21800 16200 23500

Kwazulu-Natal

80 0 300 0 150 150 90

Limpopo 5 810 6 750 3 520 3 500 3350 1200 4110

North West

25 650 28 000 22 000 20 900 16800 10000 28500

Gauteng 60 60 60 0 0 0 0

Source Statistics and Economic Analysis

Table 1 indicates that during the past three years Free State Province has been the major producer of groundnuts even though groundnut production in this province has experienced considerable fluctuations during this period Northern Cape is the second largest producer of groundnuts after Free State However North West Province increased its production significantly during 200708 and surpassed Northern Capersquos production volumes Notably groundnut production in all the major producing regions has undergone a drastic decline during 201213 season leading to a slight decline in

Northern Cape 29

Free State 33

Kwazulu-Natal

0

Limpopo 4

Gauteng 0

North West 34

Figure 2 Groundnuts production by Provinces 201415

5

South Africarsquos total groundnuts production Gauteng Province has no recorded any groundnuts production volume from 201011 until 201314 Plantings and production trends of groundnuts from 200506 to 201415 production seasons are as depicted in Figure 3 below

Source Statistics and Economic Analysis

Figure 3 makes it clear that production volumes for groundnuts were at higher levels during the 200506 marketing season and this was followed by a slight decline in groundnuts production volumes during 200607 season During the 200506 season the production increased slightly followed by a slight decline in area planted for groundnuts during the 200607 season Despite only slight decrease in the area planted to groundnuts during 201011 season groundnuts production volumes declined significantly during that time indicating a slight decline in yields The period under analysis closed with relatively lower volumes of groundnut production despite a slight increase in area planted during 201314 season

3 MARKET STRUCTURE

21 Domestic Market and Prices

Figure 4 indicates the local production together with consumption of groundnut in South Africa Generally the production and consumption of groundnut fluctuated considerably throughout the period under analysis The figure indicates that the period under analysis opened with production of groundnuts being more than the consumption implying that there was enough groundnuts production and less consumption in South Africa in 200506 as indicated in the figure The figure also indicates

200405

200506

200607

200708

200809

200910

201011

201112

201213

201314

total area planted 40000 48550 40770 54200 52000 57000 55000 45000 47000 52000

production 72419 83734 65630 100481 113000 100000 73000 67000 47000 84000

0

20000

40000

60000

80000

100000

120000

0

10000

20000

30000

40000

50000

60000

Pro

du

ctio

n (

To

n)

Are

a P

lan

ted

(H

a)

Years

Figure 3 Production vs Total Area Planted

6

that between 200708 and 201112 production of groundnuts was more than the consumption of groundnuts The period under analysis closed with more production volume as compared to consumption volumes in 201415 season

Source Statistics and Economic Analysis The average producer prices for groundnuts from 200405 to 201314 season are as indicated in Figure 5 below

Source Statistics and Economic Analysis

Figure 5 shows that producer prices for groundnuts were very low during the opening season of the period under analysis (200405) Generally the figure indicate fluctuating trend of groundnut producer

0

20000

40000

60000

80000

100000

120000

To

ns

Period (Years)

Figure 4 Local Groundnuts Production vs Consumption

Groundnuts production Groundnuts consumption

200405

200506 200607 200708 20080

9 20091

0 201011

201112

201213 201314

price 246421 284911 551438 61221 636069 465965 514154 828726 875587 823867

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Pri

ce (

RT

on

)

Period (Years)

Figure 5 Producer prices for Groundnuts

7

price This was followed by gradual increase in groundnuts producer price between 200506 and 200809 The figure indicates that the period under analysis closed with slightly lower producer prices for the product in 20131 season (R8 23867ton) Figure 6 shows the utilization of groundnuts in South Africa from 200506 to 201415 The figure shows that groundnuts in South Africa are utilized mainly for manufacturing peanut butter for sales as raw peanuts to the direct market for oil and oilcake and for seed The figure further indicates that groundnut is mainly used for peanut butter and direct market as compared to the use for oil amp oilcake and seed On average 2 235tons of groundnuts are sold for crushing into oil and oilcake in the domestic market while 3 185 tons are directed to the animal feed and seed markets

Source Statistics and Economic Analysis

22 Exports

The volume and value of groundnuts exports from South Africa to the world are summarized in Figure 7 below Figure 7 indicates volume and value of groundnuts exports from 2005 to 2014 The figure indicates that throughout the period under analysis the quantity of groundnuts exports were consistent with the value of groundnuts exports The period under review opened with moderate volume of groundnuts exports On average 19 670 tons were exported at the value of 149 million The figure further indicates that exports of groundnuts fluctuated considerably over the period under analysis The highest volume of groundnuts exports were recorded in 2005 (50571 tons) and the lowest was recorded in 2010 (12541 tons)

0

10000

20000

30000

40000

50000

60000

70000

200506 200607 200708 200809 200910 201011 201112 201213 201314 201415

Vo

lum

e (

Ton

s)

Marketing Years

Figure 6 Utilization of Groundnuts in the domestic market

Oil and Oilcake Peanut butter and direct edible market Seed and Unshelled

8

Source Statistics amp Economic Analysis and Quantec Easydata

South Africa imports its groundnuts from countries such as Mozambique Malawi Argentina China and India as shown in Figure 8

Source ITC Trade Map

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

30000

35000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R0

00)

Exp

ort

Vo

lum

es (

To

ns)

Period (Years)

Figure 7 Volume and Value of Groundnuts exports 2005-2014

Export Quantity (tons) Export Value (Rands)

Mozambique 57

China 10

Malawi 28

Argentina 5

Figure 8 Export of Groundnuts to RSA in 2014

9

Figure 8 below shows exporters of groundnuts to the Republic of South Africa during the year 2014 The figure indicates that Mozambique is the largest exporters of groundnuts into South African markets followed by Malawi China and Argentina in 2014 During the same year Mozambique accounted for about 57 of the total groundnuts imported by South Africa followed by Malawi (28 ) and China with 10 Argentina contributed 5 towards South Africarsquos total groundnut imports

Source Quantec Easy data

Figure 9 indicates volume of groundnuts exports to various regions in the world The figure indicates that South Africa exports mainly to Europe Asia and Africa The figure also indicates that volumes of groundnuts exports to America and Oceania are less than 400 tons of groundnuts per year Figure 9 shows that groundnut exports from South Africa are destined for the markets in Europe Asia Africa the Americas and Oceania The figure indicates that exports to Europe and Asia are more than those destined to neighboring countries to South Africa within the African continent which is not surprising as most countries in Africa are involved mostly in primary agricultural production than in processing Generally the volume of groundnuts exports to Europe started to decline from 2006 until 2007 followed by slight increases between 2008 and 2010 Exports to Asia fluctuated at moderate levels from the year 2005 until some increases were experienced in 2008 The period under review closed with larger volumes of groundnuts exports being destined to Africa followed by Europe Figure 10 indicates exports of groundnuts to European Union from 2005 to 2014 The exports of groundnuts to this region were fluctuating throughout the period under analysis The figure indicates that the South African groundnuts exports over the period under review were destined mainly to Netherlands United Kingdom and Germany Exports to Belgium remained minimal The period under analysis closed with Netherlands at a low volume of groundnuts originating from South Africa

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Africa 1916 1358 1070 1937 2033 8324 4022 882 2329 3684

Americas 0 0 60 0 186 18 396 90 0 0

Asia 9022 7208 4645 7497 4542 7506 4832 3904 2562 2705

Europe 9241 3722 2700 4664 4655 13280 7312 5514 3856 3164

Oceania 396 252 198 386 216 162 324 144 144 126

0

2000

4000

6000

8000

10000

12000

14000

Exp

ort

Vo

lum

e (

ton

s)

period (Years)

Figure 9 Volume of groundnuts exports to various regions

Africa Americas Asia Europe Oceania

10

Source Quantec Easy data

Figure 11 presents exports of groundnuts to Eastern Asia from 2005 to 2014 The figure indicates that in Eastern Asia South Africa exports groundnuts mainly to Japan The figure further indicates that exports of groundnuts to China and Hong Kong were very low and erratic during period under analysis As depicted in Figure 11 below exports of groundnuts from South Africa to Eastern Asia have generally been declining from 2005 until the year 2014 mainly because Japan who is the major importer of groundnuts from South Africa in Eastern Asia substituted imports from South Africa with those from Argentina and Brazil

Source Quantec Easy data

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Belgium 54 36 0 130 98 79 0 0 0 540

Finland 58 0 0 470 114 288 234 122 79 72

United Kingdom 2108 486 348 703 90 2206 531 0 0 286

Netherlands 3513 1385 1250 2513 3451 8713 5326 5159 3402 2086

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 10 Volume of groundnuts exports to the European Union

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 0 0 0 18 0 0 0 0 0 0

Japan 902196 71202 4608 74784 4434 60296 465175 38678 256219 263793

Hong Kong 0 0 0 0 0 0 1806 0 0 0

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (t

on

s)

Period (Years)

figure 11 Volume of groundnuts exports to Eastern Asia

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

4

11 Producing Areas

Figure 2 below shows the contribution of each province to the total groundnuts production in South Africa The figure clearly indicates that the groundnuts are produced mainly in three provinces namely the North West (34) Free State (33) and Northern Cape Province (29) Groundnuts are also produced in Limpopo KwaZulu-Natal and Gauteng provinces although the production is lower in these provinces

Source Statistics and Economic Analysis

Table 1 Groundnut production by provinces

PROVINCE

Production (tons) 200708

Production (tons) 200809

Production (tons) 200910

Production (tons) 201011

Production (tons) 201112

Production (tons) 201213

Production (tons) 201314

Northern Cape

21500 31 000 27 120 18 950 16900 14000 18200

Free State

35 700 33 690 35 000 20 700 21800 16200 23500

Kwazulu-Natal

80 0 300 0 150 150 90

Limpopo 5 810 6 750 3 520 3 500 3350 1200 4110

North West

25 650 28 000 22 000 20 900 16800 10000 28500

Gauteng 60 60 60 0 0 0 0

Source Statistics and Economic Analysis

Table 1 indicates that during the past three years Free State Province has been the major producer of groundnuts even though groundnut production in this province has experienced considerable fluctuations during this period Northern Cape is the second largest producer of groundnuts after Free State However North West Province increased its production significantly during 200708 and surpassed Northern Capersquos production volumes Notably groundnut production in all the major producing regions has undergone a drastic decline during 201213 season leading to a slight decline in

Northern Cape 29

Free State 33

Kwazulu-Natal

0

Limpopo 4

Gauteng 0

North West 34

Figure 2 Groundnuts production by Provinces 201415

5

South Africarsquos total groundnuts production Gauteng Province has no recorded any groundnuts production volume from 201011 until 201314 Plantings and production trends of groundnuts from 200506 to 201415 production seasons are as depicted in Figure 3 below

Source Statistics and Economic Analysis

Figure 3 makes it clear that production volumes for groundnuts were at higher levels during the 200506 marketing season and this was followed by a slight decline in groundnuts production volumes during 200607 season During the 200506 season the production increased slightly followed by a slight decline in area planted for groundnuts during the 200607 season Despite only slight decrease in the area planted to groundnuts during 201011 season groundnuts production volumes declined significantly during that time indicating a slight decline in yields The period under analysis closed with relatively lower volumes of groundnut production despite a slight increase in area planted during 201314 season

3 MARKET STRUCTURE

21 Domestic Market and Prices

Figure 4 indicates the local production together with consumption of groundnut in South Africa Generally the production and consumption of groundnut fluctuated considerably throughout the period under analysis The figure indicates that the period under analysis opened with production of groundnuts being more than the consumption implying that there was enough groundnuts production and less consumption in South Africa in 200506 as indicated in the figure The figure also indicates

200405

200506

200607

200708

200809

200910

201011

201112

201213

201314

total area planted 40000 48550 40770 54200 52000 57000 55000 45000 47000 52000

production 72419 83734 65630 100481 113000 100000 73000 67000 47000 84000

0

20000

40000

60000

80000

100000

120000

0

10000

20000

30000

40000

50000

60000

Pro

du

ctio

n (

To

n)

Are

a P

lan

ted

(H

a)

Years

Figure 3 Production vs Total Area Planted

6

that between 200708 and 201112 production of groundnuts was more than the consumption of groundnuts The period under analysis closed with more production volume as compared to consumption volumes in 201415 season

Source Statistics and Economic Analysis The average producer prices for groundnuts from 200405 to 201314 season are as indicated in Figure 5 below

Source Statistics and Economic Analysis

Figure 5 shows that producer prices for groundnuts were very low during the opening season of the period under analysis (200405) Generally the figure indicate fluctuating trend of groundnut producer

0

20000

40000

60000

80000

100000

120000

To

ns

Period (Years)

Figure 4 Local Groundnuts Production vs Consumption

Groundnuts production Groundnuts consumption

200405

200506 200607 200708 20080

9 20091

0 201011

201112

201213 201314

price 246421 284911 551438 61221 636069 465965 514154 828726 875587 823867

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Pri

ce (

RT

on

)

Period (Years)

Figure 5 Producer prices for Groundnuts

7

price This was followed by gradual increase in groundnuts producer price between 200506 and 200809 The figure indicates that the period under analysis closed with slightly lower producer prices for the product in 20131 season (R8 23867ton) Figure 6 shows the utilization of groundnuts in South Africa from 200506 to 201415 The figure shows that groundnuts in South Africa are utilized mainly for manufacturing peanut butter for sales as raw peanuts to the direct market for oil and oilcake and for seed The figure further indicates that groundnut is mainly used for peanut butter and direct market as compared to the use for oil amp oilcake and seed On average 2 235tons of groundnuts are sold for crushing into oil and oilcake in the domestic market while 3 185 tons are directed to the animal feed and seed markets

Source Statistics and Economic Analysis

22 Exports

The volume and value of groundnuts exports from South Africa to the world are summarized in Figure 7 below Figure 7 indicates volume and value of groundnuts exports from 2005 to 2014 The figure indicates that throughout the period under analysis the quantity of groundnuts exports were consistent with the value of groundnuts exports The period under review opened with moderate volume of groundnuts exports On average 19 670 tons were exported at the value of 149 million The figure further indicates that exports of groundnuts fluctuated considerably over the period under analysis The highest volume of groundnuts exports were recorded in 2005 (50571 tons) and the lowest was recorded in 2010 (12541 tons)

0

10000

20000

30000

40000

50000

60000

70000

200506 200607 200708 200809 200910 201011 201112 201213 201314 201415

Vo

lum

e (

Ton

s)

Marketing Years

Figure 6 Utilization of Groundnuts in the domestic market

Oil and Oilcake Peanut butter and direct edible market Seed and Unshelled

8

Source Statistics amp Economic Analysis and Quantec Easydata

South Africa imports its groundnuts from countries such as Mozambique Malawi Argentina China and India as shown in Figure 8

Source ITC Trade Map

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

30000

35000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R0

00)

Exp

ort

Vo

lum

es (

To

ns)

Period (Years)

Figure 7 Volume and Value of Groundnuts exports 2005-2014

Export Quantity (tons) Export Value (Rands)

Mozambique 57

China 10

Malawi 28

Argentina 5

Figure 8 Export of Groundnuts to RSA in 2014

9

Figure 8 below shows exporters of groundnuts to the Republic of South Africa during the year 2014 The figure indicates that Mozambique is the largest exporters of groundnuts into South African markets followed by Malawi China and Argentina in 2014 During the same year Mozambique accounted for about 57 of the total groundnuts imported by South Africa followed by Malawi (28 ) and China with 10 Argentina contributed 5 towards South Africarsquos total groundnut imports

Source Quantec Easy data

Figure 9 indicates volume of groundnuts exports to various regions in the world The figure indicates that South Africa exports mainly to Europe Asia and Africa The figure also indicates that volumes of groundnuts exports to America and Oceania are less than 400 tons of groundnuts per year Figure 9 shows that groundnut exports from South Africa are destined for the markets in Europe Asia Africa the Americas and Oceania The figure indicates that exports to Europe and Asia are more than those destined to neighboring countries to South Africa within the African continent which is not surprising as most countries in Africa are involved mostly in primary agricultural production than in processing Generally the volume of groundnuts exports to Europe started to decline from 2006 until 2007 followed by slight increases between 2008 and 2010 Exports to Asia fluctuated at moderate levels from the year 2005 until some increases were experienced in 2008 The period under review closed with larger volumes of groundnuts exports being destined to Africa followed by Europe Figure 10 indicates exports of groundnuts to European Union from 2005 to 2014 The exports of groundnuts to this region were fluctuating throughout the period under analysis The figure indicates that the South African groundnuts exports over the period under review were destined mainly to Netherlands United Kingdom and Germany Exports to Belgium remained minimal The period under analysis closed with Netherlands at a low volume of groundnuts originating from South Africa

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Africa 1916 1358 1070 1937 2033 8324 4022 882 2329 3684

Americas 0 0 60 0 186 18 396 90 0 0

Asia 9022 7208 4645 7497 4542 7506 4832 3904 2562 2705

Europe 9241 3722 2700 4664 4655 13280 7312 5514 3856 3164

Oceania 396 252 198 386 216 162 324 144 144 126

0

2000

4000

6000

8000

10000

12000

14000

Exp

ort

Vo

lum

e (

ton

s)

period (Years)

Figure 9 Volume of groundnuts exports to various regions

Africa Americas Asia Europe Oceania

10

Source Quantec Easy data

Figure 11 presents exports of groundnuts to Eastern Asia from 2005 to 2014 The figure indicates that in Eastern Asia South Africa exports groundnuts mainly to Japan The figure further indicates that exports of groundnuts to China and Hong Kong were very low and erratic during period under analysis As depicted in Figure 11 below exports of groundnuts from South Africa to Eastern Asia have generally been declining from 2005 until the year 2014 mainly because Japan who is the major importer of groundnuts from South Africa in Eastern Asia substituted imports from South Africa with those from Argentina and Brazil

Source Quantec Easy data

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Belgium 54 36 0 130 98 79 0 0 0 540

Finland 58 0 0 470 114 288 234 122 79 72

United Kingdom 2108 486 348 703 90 2206 531 0 0 286

Netherlands 3513 1385 1250 2513 3451 8713 5326 5159 3402 2086

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 10 Volume of groundnuts exports to the European Union

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 0 0 0 18 0 0 0 0 0 0

Japan 902196 71202 4608 74784 4434 60296 465175 38678 256219 263793

Hong Kong 0 0 0 0 0 0 1806 0 0 0

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (t

on

s)

Period (Years)

figure 11 Volume of groundnuts exports to Eastern Asia

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

5

South Africarsquos total groundnuts production Gauteng Province has no recorded any groundnuts production volume from 201011 until 201314 Plantings and production trends of groundnuts from 200506 to 201415 production seasons are as depicted in Figure 3 below

Source Statistics and Economic Analysis

Figure 3 makes it clear that production volumes for groundnuts were at higher levels during the 200506 marketing season and this was followed by a slight decline in groundnuts production volumes during 200607 season During the 200506 season the production increased slightly followed by a slight decline in area planted for groundnuts during the 200607 season Despite only slight decrease in the area planted to groundnuts during 201011 season groundnuts production volumes declined significantly during that time indicating a slight decline in yields The period under analysis closed with relatively lower volumes of groundnut production despite a slight increase in area planted during 201314 season

3 MARKET STRUCTURE

21 Domestic Market and Prices

Figure 4 indicates the local production together with consumption of groundnut in South Africa Generally the production and consumption of groundnut fluctuated considerably throughout the period under analysis The figure indicates that the period under analysis opened with production of groundnuts being more than the consumption implying that there was enough groundnuts production and less consumption in South Africa in 200506 as indicated in the figure The figure also indicates

200405

200506

200607

200708

200809

200910

201011

201112

201213

201314

total area planted 40000 48550 40770 54200 52000 57000 55000 45000 47000 52000

production 72419 83734 65630 100481 113000 100000 73000 67000 47000 84000

0

20000

40000

60000

80000

100000

120000

0

10000

20000

30000

40000

50000

60000

Pro

du

ctio

n (

To

n)

Are

a P

lan

ted

(H

a)

Years

Figure 3 Production vs Total Area Planted

6

that between 200708 and 201112 production of groundnuts was more than the consumption of groundnuts The period under analysis closed with more production volume as compared to consumption volumes in 201415 season

Source Statistics and Economic Analysis The average producer prices for groundnuts from 200405 to 201314 season are as indicated in Figure 5 below

Source Statistics and Economic Analysis

Figure 5 shows that producer prices for groundnuts were very low during the opening season of the period under analysis (200405) Generally the figure indicate fluctuating trend of groundnut producer

0

20000

40000

60000

80000

100000

120000

To

ns

Period (Years)

Figure 4 Local Groundnuts Production vs Consumption

Groundnuts production Groundnuts consumption

200405

200506 200607 200708 20080

9 20091

0 201011

201112

201213 201314

price 246421 284911 551438 61221 636069 465965 514154 828726 875587 823867

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Pri

ce (

RT

on

)

Period (Years)

Figure 5 Producer prices for Groundnuts

7

price This was followed by gradual increase in groundnuts producer price between 200506 and 200809 The figure indicates that the period under analysis closed with slightly lower producer prices for the product in 20131 season (R8 23867ton) Figure 6 shows the utilization of groundnuts in South Africa from 200506 to 201415 The figure shows that groundnuts in South Africa are utilized mainly for manufacturing peanut butter for sales as raw peanuts to the direct market for oil and oilcake and for seed The figure further indicates that groundnut is mainly used for peanut butter and direct market as compared to the use for oil amp oilcake and seed On average 2 235tons of groundnuts are sold for crushing into oil and oilcake in the domestic market while 3 185 tons are directed to the animal feed and seed markets

Source Statistics and Economic Analysis

22 Exports

The volume and value of groundnuts exports from South Africa to the world are summarized in Figure 7 below Figure 7 indicates volume and value of groundnuts exports from 2005 to 2014 The figure indicates that throughout the period under analysis the quantity of groundnuts exports were consistent with the value of groundnuts exports The period under review opened with moderate volume of groundnuts exports On average 19 670 tons were exported at the value of 149 million The figure further indicates that exports of groundnuts fluctuated considerably over the period under analysis The highest volume of groundnuts exports were recorded in 2005 (50571 tons) and the lowest was recorded in 2010 (12541 tons)

0

10000

20000

30000

40000

50000

60000

70000

200506 200607 200708 200809 200910 201011 201112 201213 201314 201415

Vo

lum

e (

Ton

s)

Marketing Years

Figure 6 Utilization of Groundnuts in the domestic market

Oil and Oilcake Peanut butter and direct edible market Seed and Unshelled

8

Source Statistics amp Economic Analysis and Quantec Easydata

South Africa imports its groundnuts from countries such as Mozambique Malawi Argentina China and India as shown in Figure 8

Source ITC Trade Map

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

30000

35000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R0

00)

Exp

ort

Vo

lum

es (

To

ns)

Period (Years)

Figure 7 Volume and Value of Groundnuts exports 2005-2014

Export Quantity (tons) Export Value (Rands)

Mozambique 57

China 10

Malawi 28

Argentina 5

Figure 8 Export of Groundnuts to RSA in 2014

9

Figure 8 below shows exporters of groundnuts to the Republic of South Africa during the year 2014 The figure indicates that Mozambique is the largest exporters of groundnuts into South African markets followed by Malawi China and Argentina in 2014 During the same year Mozambique accounted for about 57 of the total groundnuts imported by South Africa followed by Malawi (28 ) and China with 10 Argentina contributed 5 towards South Africarsquos total groundnut imports

Source Quantec Easy data

Figure 9 indicates volume of groundnuts exports to various regions in the world The figure indicates that South Africa exports mainly to Europe Asia and Africa The figure also indicates that volumes of groundnuts exports to America and Oceania are less than 400 tons of groundnuts per year Figure 9 shows that groundnut exports from South Africa are destined for the markets in Europe Asia Africa the Americas and Oceania The figure indicates that exports to Europe and Asia are more than those destined to neighboring countries to South Africa within the African continent which is not surprising as most countries in Africa are involved mostly in primary agricultural production than in processing Generally the volume of groundnuts exports to Europe started to decline from 2006 until 2007 followed by slight increases between 2008 and 2010 Exports to Asia fluctuated at moderate levels from the year 2005 until some increases were experienced in 2008 The period under review closed with larger volumes of groundnuts exports being destined to Africa followed by Europe Figure 10 indicates exports of groundnuts to European Union from 2005 to 2014 The exports of groundnuts to this region were fluctuating throughout the period under analysis The figure indicates that the South African groundnuts exports over the period under review were destined mainly to Netherlands United Kingdom and Germany Exports to Belgium remained minimal The period under analysis closed with Netherlands at a low volume of groundnuts originating from South Africa

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Africa 1916 1358 1070 1937 2033 8324 4022 882 2329 3684

Americas 0 0 60 0 186 18 396 90 0 0

Asia 9022 7208 4645 7497 4542 7506 4832 3904 2562 2705

Europe 9241 3722 2700 4664 4655 13280 7312 5514 3856 3164

Oceania 396 252 198 386 216 162 324 144 144 126

0

2000

4000

6000

8000

10000

12000

14000

Exp

ort

Vo

lum

e (

ton

s)

period (Years)

Figure 9 Volume of groundnuts exports to various regions

Africa Americas Asia Europe Oceania

10

Source Quantec Easy data

Figure 11 presents exports of groundnuts to Eastern Asia from 2005 to 2014 The figure indicates that in Eastern Asia South Africa exports groundnuts mainly to Japan The figure further indicates that exports of groundnuts to China and Hong Kong were very low and erratic during period under analysis As depicted in Figure 11 below exports of groundnuts from South Africa to Eastern Asia have generally been declining from 2005 until the year 2014 mainly because Japan who is the major importer of groundnuts from South Africa in Eastern Asia substituted imports from South Africa with those from Argentina and Brazil

Source Quantec Easy data

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Belgium 54 36 0 130 98 79 0 0 0 540

Finland 58 0 0 470 114 288 234 122 79 72

United Kingdom 2108 486 348 703 90 2206 531 0 0 286

Netherlands 3513 1385 1250 2513 3451 8713 5326 5159 3402 2086

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 10 Volume of groundnuts exports to the European Union

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 0 0 0 18 0 0 0 0 0 0

Japan 902196 71202 4608 74784 4434 60296 465175 38678 256219 263793

Hong Kong 0 0 0 0 0 0 1806 0 0 0

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (t

on

s)

Period (Years)

figure 11 Volume of groundnuts exports to Eastern Asia

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

6

that between 200708 and 201112 production of groundnuts was more than the consumption of groundnuts The period under analysis closed with more production volume as compared to consumption volumes in 201415 season

Source Statistics and Economic Analysis The average producer prices for groundnuts from 200405 to 201314 season are as indicated in Figure 5 below

Source Statistics and Economic Analysis

Figure 5 shows that producer prices for groundnuts were very low during the opening season of the period under analysis (200405) Generally the figure indicate fluctuating trend of groundnut producer

0

20000

40000

60000

80000

100000

120000

To

ns

Period (Years)

Figure 4 Local Groundnuts Production vs Consumption

Groundnuts production Groundnuts consumption

200405

200506 200607 200708 20080

9 20091

0 201011

201112

201213 201314

price 246421 284911 551438 61221 636069 465965 514154 828726 875587 823867

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Pri

ce (

RT

on

)

Period (Years)

Figure 5 Producer prices for Groundnuts

7

price This was followed by gradual increase in groundnuts producer price between 200506 and 200809 The figure indicates that the period under analysis closed with slightly lower producer prices for the product in 20131 season (R8 23867ton) Figure 6 shows the utilization of groundnuts in South Africa from 200506 to 201415 The figure shows that groundnuts in South Africa are utilized mainly for manufacturing peanut butter for sales as raw peanuts to the direct market for oil and oilcake and for seed The figure further indicates that groundnut is mainly used for peanut butter and direct market as compared to the use for oil amp oilcake and seed On average 2 235tons of groundnuts are sold for crushing into oil and oilcake in the domestic market while 3 185 tons are directed to the animal feed and seed markets

Source Statistics and Economic Analysis

22 Exports

The volume and value of groundnuts exports from South Africa to the world are summarized in Figure 7 below Figure 7 indicates volume and value of groundnuts exports from 2005 to 2014 The figure indicates that throughout the period under analysis the quantity of groundnuts exports were consistent with the value of groundnuts exports The period under review opened with moderate volume of groundnuts exports On average 19 670 tons were exported at the value of 149 million The figure further indicates that exports of groundnuts fluctuated considerably over the period under analysis The highest volume of groundnuts exports were recorded in 2005 (50571 tons) and the lowest was recorded in 2010 (12541 tons)

0

10000

20000

30000

40000

50000

60000

70000

200506 200607 200708 200809 200910 201011 201112 201213 201314 201415

Vo

lum

e (

Ton

s)

Marketing Years

Figure 6 Utilization of Groundnuts in the domestic market

Oil and Oilcake Peanut butter and direct edible market Seed and Unshelled

8

Source Statistics amp Economic Analysis and Quantec Easydata

South Africa imports its groundnuts from countries such as Mozambique Malawi Argentina China and India as shown in Figure 8

Source ITC Trade Map

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

30000

35000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R0

00)

Exp

ort

Vo

lum

es (

To

ns)

Period (Years)

Figure 7 Volume and Value of Groundnuts exports 2005-2014

Export Quantity (tons) Export Value (Rands)

Mozambique 57

China 10

Malawi 28

Argentina 5

Figure 8 Export of Groundnuts to RSA in 2014

9

Figure 8 below shows exporters of groundnuts to the Republic of South Africa during the year 2014 The figure indicates that Mozambique is the largest exporters of groundnuts into South African markets followed by Malawi China and Argentina in 2014 During the same year Mozambique accounted for about 57 of the total groundnuts imported by South Africa followed by Malawi (28 ) and China with 10 Argentina contributed 5 towards South Africarsquos total groundnut imports

Source Quantec Easy data

Figure 9 indicates volume of groundnuts exports to various regions in the world The figure indicates that South Africa exports mainly to Europe Asia and Africa The figure also indicates that volumes of groundnuts exports to America and Oceania are less than 400 tons of groundnuts per year Figure 9 shows that groundnut exports from South Africa are destined for the markets in Europe Asia Africa the Americas and Oceania The figure indicates that exports to Europe and Asia are more than those destined to neighboring countries to South Africa within the African continent which is not surprising as most countries in Africa are involved mostly in primary agricultural production than in processing Generally the volume of groundnuts exports to Europe started to decline from 2006 until 2007 followed by slight increases between 2008 and 2010 Exports to Asia fluctuated at moderate levels from the year 2005 until some increases were experienced in 2008 The period under review closed with larger volumes of groundnuts exports being destined to Africa followed by Europe Figure 10 indicates exports of groundnuts to European Union from 2005 to 2014 The exports of groundnuts to this region were fluctuating throughout the period under analysis The figure indicates that the South African groundnuts exports over the period under review were destined mainly to Netherlands United Kingdom and Germany Exports to Belgium remained minimal The period under analysis closed with Netherlands at a low volume of groundnuts originating from South Africa

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Africa 1916 1358 1070 1937 2033 8324 4022 882 2329 3684

Americas 0 0 60 0 186 18 396 90 0 0

Asia 9022 7208 4645 7497 4542 7506 4832 3904 2562 2705

Europe 9241 3722 2700 4664 4655 13280 7312 5514 3856 3164

Oceania 396 252 198 386 216 162 324 144 144 126

0

2000

4000

6000

8000

10000

12000

14000

Exp

ort

Vo

lum

e (

ton

s)

period (Years)

Figure 9 Volume of groundnuts exports to various regions

Africa Americas Asia Europe Oceania

10

Source Quantec Easy data

Figure 11 presents exports of groundnuts to Eastern Asia from 2005 to 2014 The figure indicates that in Eastern Asia South Africa exports groundnuts mainly to Japan The figure further indicates that exports of groundnuts to China and Hong Kong were very low and erratic during period under analysis As depicted in Figure 11 below exports of groundnuts from South Africa to Eastern Asia have generally been declining from 2005 until the year 2014 mainly because Japan who is the major importer of groundnuts from South Africa in Eastern Asia substituted imports from South Africa with those from Argentina and Brazil

Source Quantec Easy data

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Belgium 54 36 0 130 98 79 0 0 0 540

Finland 58 0 0 470 114 288 234 122 79 72

United Kingdom 2108 486 348 703 90 2206 531 0 0 286

Netherlands 3513 1385 1250 2513 3451 8713 5326 5159 3402 2086

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 10 Volume of groundnuts exports to the European Union

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 0 0 0 18 0 0 0 0 0 0

Japan 902196 71202 4608 74784 4434 60296 465175 38678 256219 263793

Hong Kong 0 0 0 0 0 0 1806 0 0 0

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (t

on

s)

Period (Years)

figure 11 Volume of groundnuts exports to Eastern Asia

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

7

price This was followed by gradual increase in groundnuts producer price between 200506 and 200809 The figure indicates that the period under analysis closed with slightly lower producer prices for the product in 20131 season (R8 23867ton) Figure 6 shows the utilization of groundnuts in South Africa from 200506 to 201415 The figure shows that groundnuts in South Africa are utilized mainly for manufacturing peanut butter for sales as raw peanuts to the direct market for oil and oilcake and for seed The figure further indicates that groundnut is mainly used for peanut butter and direct market as compared to the use for oil amp oilcake and seed On average 2 235tons of groundnuts are sold for crushing into oil and oilcake in the domestic market while 3 185 tons are directed to the animal feed and seed markets

Source Statistics and Economic Analysis

22 Exports

The volume and value of groundnuts exports from South Africa to the world are summarized in Figure 7 below Figure 7 indicates volume and value of groundnuts exports from 2005 to 2014 The figure indicates that throughout the period under analysis the quantity of groundnuts exports were consistent with the value of groundnuts exports The period under review opened with moderate volume of groundnuts exports On average 19 670 tons were exported at the value of 149 million The figure further indicates that exports of groundnuts fluctuated considerably over the period under analysis The highest volume of groundnuts exports were recorded in 2005 (50571 tons) and the lowest was recorded in 2010 (12541 tons)

0

10000

20000

30000

40000

50000

60000

70000

200506 200607 200708 200809 200910 201011 201112 201213 201314 201415

Vo

lum

e (

Ton

s)

Marketing Years

Figure 6 Utilization of Groundnuts in the domestic market

Oil and Oilcake Peanut butter and direct edible market Seed and Unshelled

8

Source Statistics amp Economic Analysis and Quantec Easydata

South Africa imports its groundnuts from countries such as Mozambique Malawi Argentina China and India as shown in Figure 8

Source ITC Trade Map

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

30000

35000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R0

00)

Exp

ort

Vo

lum

es (

To

ns)

Period (Years)

Figure 7 Volume and Value of Groundnuts exports 2005-2014

Export Quantity (tons) Export Value (Rands)

Mozambique 57

China 10

Malawi 28

Argentina 5

Figure 8 Export of Groundnuts to RSA in 2014

9

Figure 8 below shows exporters of groundnuts to the Republic of South Africa during the year 2014 The figure indicates that Mozambique is the largest exporters of groundnuts into South African markets followed by Malawi China and Argentina in 2014 During the same year Mozambique accounted for about 57 of the total groundnuts imported by South Africa followed by Malawi (28 ) and China with 10 Argentina contributed 5 towards South Africarsquos total groundnut imports

Source Quantec Easy data

Figure 9 indicates volume of groundnuts exports to various regions in the world The figure indicates that South Africa exports mainly to Europe Asia and Africa The figure also indicates that volumes of groundnuts exports to America and Oceania are less than 400 tons of groundnuts per year Figure 9 shows that groundnut exports from South Africa are destined for the markets in Europe Asia Africa the Americas and Oceania The figure indicates that exports to Europe and Asia are more than those destined to neighboring countries to South Africa within the African continent which is not surprising as most countries in Africa are involved mostly in primary agricultural production than in processing Generally the volume of groundnuts exports to Europe started to decline from 2006 until 2007 followed by slight increases between 2008 and 2010 Exports to Asia fluctuated at moderate levels from the year 2005 until some increases were experienced in 2008 The period under review closed with larger volumes of groundnuts exports being destined to Africa followed by Europe Figure 10 indicates exports of groundnuts to European Union from 2005 to 2014 The exports of groundnuts to this region were fluctuating throughout the period under analysis The figure indicates that the South African groundnuts exports over the period under review were destined mainly to Netherlands United Kingdom and Germany Exports to Belgium remained minimal The period under analysis closed with Netherlands at a low volume of groundnuts originating from South Africa

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Africa 1916 1358 1070 1937 2033 8324 4022 882 2329 3684

Americas 0 0 60 0 186 18 396 90 0 0

Asia 9022 7208 4645 7497 4542 7506 4832 3904 2562 2705

Europe 9241 3722 2700 4664 4655 13280 7312 5514 3856 3164

Oceania 396 252 198 386 216 162 324 144 144 126

0

2000

4000

6000

8000

10000

12000

14000

Exp

ort

Vo

lum

e (

ton

s)

period (Years)

Figure 9 Volume of groundnuts exports to various regions

Africa Americas Asia Europe Oceania

10

Source Quantec Easy data

Figure 11 presents exports of groundnuts to Eastern Asia from 2005 to 2014 The figure indicates that in Eastern Asia South Africa exports groundnuts mainly to Japan The figure further indicates that exports of groundnuts to China and Hong Kong were very low and erratic during period under analysis As depicted in Figure 11 below exports of groundnuts from South Africa to Eastern Asia have generally been declining from 2005 until the year 2014 mainly because Japan who is the major importer of groundnuts from South Africa in Eastern Asia substituted imports from South Africa with those from Argentina and Brazil

Source Quantec Easy data

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Belgium 54 36 0 130 98 79 0 0 0 540

Finland 58 0 0 470 114 288 234 122 79 72

United Kingdom 2108 486 348 703 90 2206 531 0 0 286

Netherlands 3513 1385 1250 2513 3451 8713 5326 5159 3402 2086

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 10 Volume of groundnuts exports to the European Union

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 0 0 0 18 0 0 0 0 0 0

Japan 902196 71202 4608 74784 4434 60296 465175 38678 256219 263793

Hong Kong 0 0 0 0 0 0 1806 0 0 0

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (t

on

s)

Period (Years)

figure 11 Volume of groundnuts exports to Eastern Asia

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

8

Source Statistics amp Economic Analysis and Quantec Easydata

South Africa imports its groundnuts from countries such as Mozambique Malawi Argentina China and India as shown in Figure 8

Source ITC Trade Map

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

30000

35000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R0

00)

Exp

ort

Vo

lum

es (

To

ns)

Period (Years)

Figure 7 Volume and Value of Groundnuts exports 2005-2014

Export Quantity (tons) Export Value (Rands)

Mozambique 57

China 10

Malawi 28

Argentina 5

Figure 8 Export of Groundnuts to RSA in 2014

9

Figure 8 below shows exporters of groundnuts to the Republic of South Africa during the year 2014 The figure indicates that Mozambique is the largest exporters of groundnuts into South African markets followed by Malawi China and Argentina in 2014 During the same year Mozambique accounted for about 57 of the total groundnuts imported by South Africa followed by Malawi (28 ) and China with 10 Argentina contributed 5 towards South Africarsquos total groundnut imports

Source Quantec Easy data

Figure 9 indicates volume of groundnuts exports to various regions in the world The figure indicates that South Africa exports mainly to Europe Asia and Africa The figure also indicates that volumes of groundnuts exports to America and Oceania are less than 400 tons of groundnuts per year Figure 9 shows that groundnut exports from South Africa are destined for the markets in Europe Asia Africa the Americas and Oceania The figure indicates that exports to Europe and Asia are more than those destined to neighboring countries to South Africa within the African continent which is not surprising as most countries in Africa are involved mostly in primary agricultural production than in processing Generally the volume of groundnuts exports to Europe started to decline from 2006 until 2007 followed by slight increases between 2008 and 2010 Exports to Asia fluctuated at moderate levels from the year 2005 until some increases were experienced in 2008 The period under review closed with larger volumes of groundnuts exports being destined to Africa followed by Europe Figure 10 indicates exports of groundnuts to European Union from 2005 to 2014 The exports of groundnuts to this region were fluctuating throughout the period under analysis The figure indicates that the South African groundnuts exports over the period under review were destined mainly to Netherlands United Kingdom and Germany Exports to Belgium remained minimal The period under analysis closed with Netherlands at a low volume of groundnuts originating from South Africa

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Africa 1916 1358 1070 1937 2033 8324 4022 882 2329 3684

Americas 0 0 60 0 186 18 396 90 0 0

Asia 9022 7208 4645 7497 4542 7506 4832 3904 2562 2705

Europe 9241 3722 2700 4664 4655 13280 7312 5514 3856 3164

Oceania 396 252 198 386 216 162 324 144 144 126

0

2000

4000

6000

8000

10000

12000

14000

Exp

ort

Vo

lum

e (

ton

s)

period (Years)

Figure 9 Volume of groundnuts exports to various regions

Africa Americas Asia Europe Oceania

10

Source Quantec Easy data

Figure 11 presents exports of groundnuts to Eastern Asia from 2005 to 2014 The figure indicates that in Eastern Asia South Africa exports groundnuts mainly to Japan The figure further indicates that exports of groundnuts to China and Hong Kong were very low and erratic during period under analysis As depicted in Figure 11 below exports of groundnuts from South Africa to Eastern Asia have generally been declining from 2005 until the year 2014 mainly because Japan who is the major importer of groundnuts from South Africa in Eastern Asia substituted imports from South Africa with those from Argentina and Brazil

Source Quantec Easy data

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Belgium 54 36 0 130 98 79 0 0 0 540

Finland 58 0 0 470 114 288 234 122 79 72

United Kingdom 2108 486 348 703 90 2206 531 0 0 286

Netherlands 3513 1385 1250 2513 3451 8713 5326 5159 3402 2086

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 10 Volume of groundnuts exports to the European Union

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 0 0 0 18 0 0 0 0 0 0

Japan 902196 71202 4608 74784 4434 60296 465175 38678 256219 263793

Hong Kong 0 0 0 0 0 0 1806 0 0 0

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (t

on

s)

Period (Years)

figure 11 Volume of groundnuts exports to Eastern Asia

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

9

Figure 8 below shows exporters of groundnuts to the Republic of South Africa during the year 2014 The figure indicates that Mozambique is the largest exporters of groundnuts into South African markets followed by Malawi China and Argentina in 2014 During the same year Mozambique accounted for about 57 of the total groundnuts imported by South Africa followed by Malawi (28 ) and China with 10 Argentina contributed 5 towards South Africarsquos total groundnut imports

Source Quantec Easy data

Figure 9 indicates volume of groundnuts exports to various regions in the world The figure indicates that South Africa exports mainly to Europe Asia and Africa The figure also indicates that volumes of groundnuts exports to America and Oceania are less than 400 tons of groundnuts per year Figure 9 shows that groundnut exports from South Africa are destined for the markets in Europe Asia Africa the Americas and Oceania The figure indicates that exports to Europe and Asia are more than those destined to neighboring countries to South Africa within the African continent which is not surprising as most countries in Africa are involved mostly in primary agricultural production than in processing Generally the volume of groundnuts exports to Europe started to decline from 2006 until 2007 followed by slight increases between 2008 and 2010 Exports to Asia fluctuated at moderate levels from the year 2005 until some increases were experienced in 2008 The period under review closed with larger volumes of groundnuts exports being destined to Africa followed by Europe Figure 10 indicates exports of groundnuts to European Union from 2005 to 2014 The exports of groundnuts to this region were fluctuating throughout the period under analysis The figure indicates that the South African groundnuts exports over the period under review were destined mainly to Netherlands United Kingdom and Germany Exports to Belgium remained minimal The period under analysis closed with Netherlands at a low volume of groundnuts originating from South Africa

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Africa 1916 1358 1070 1937 2033 8324 4022 882 2329 3684

Americas 0 0 60 0 186 18 396 90 0 0

Asia 9022 7208 4645 7497 4542 7506 4832 3904 2562 2705

Europe 9241 3722 2700 4664 4655 13280 7312 5514 3856 3164

Oceania 396 252 198 386 216 162 324 144 144 126

0

2000

4000

6000

8000

10000

12000

14000

Exp

ort

Vo

lum

e (

ton

s)

period (Years)

Figure 9 Volume of groundnuts exports to various regions

Africa Americas Asia Europe Oceania

10

Source Quantec Easy data

Figure 11 presents exports of groundnuts to Eastern Asia from 2005 to 2014 The figure indicates that in Eastern Asia South Africa exports groundnuts mainly to Japan The figure further indicates that exports of groundnuts to China and Hong Kong were very low and erratic during period under analysis As depicted in Figure 11 below exports of groundnuts from South Africa to Eastern Asia have generally been declining from 2005 until the year 2014 mainly because Japan who is the major importer of groundnuts from South Africa in Eastern Asia substituted imports from South Africa with those from Argentina and Brazil

Source Quantec Easy data

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Belgium 54 36 0 130 98 79 0 0 0 540

Finland 58 0 0 470 114 288 234 122 79 72

United Kingdom 2108 486 348 703 90 2206 531 0 0 286

Netherlands 3513 1385 1250 2513 3451 8713 5326 5159 3402 2086

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 10 Volume of groundnuts exports to the European Union

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 0 0 0 18 0 0 0 0 0 0

Japan 902196 71202 4608 74784 4434 60296 465175 38678 256219 263793

Hong Kong 0 0 0 0 0 0 1806 0 0 0

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (t

on

s)

Period (Years)

figure 11 Volume of groundnuts exports to Eastern Asia

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

10

Source Quantec Easy data

Figure 11 presents exports of groundnuts to Eastern Asia from 2005 to 2014 The figure indicates that in Eastern Asia South Africa exports groundnuts mainly to Japan The figure further indicates that exports of groundnuts to China and Hong Kong were very low and erratic during period under analysis As depicted in Figure 11 below exports of groundnuts from South Africa to Eastern Asia have generally been declining from 2005 until the year 2014 mainly because Japan who is the major importer of groundnuts from South Africa in Eastern Asia substituted imports from South Africa with those from Argentina and Brazil

Source Quantec Easy data

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Belgium 54 36 0 130 98 79 0 0 0 540

Finland 58 0 0 470 114 288 234 122 79 72

United Kingdom 2108 486 348 703 90 2206 531 0 0 286

Netherlands 3513 1385 1250 2513 3451 8713 5326 5159 3402 2086

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 10 Volume of groundnuts exports to the European Union

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 0 0 0 18 0 0 0 0 0 0

Japan 902196 71202 4608 74784 4434 60296 465175 38678 256219 263793

Hong Kong 0 0 0 0 0 0 1806 0 0 0

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

10000

Exp

ort

Vo

lum

e (t

on

s)

Period (Years)

figure 11 Volume of groundnuts exports to Eastern Asia

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

11

Figure 12 below indicates volumes of groundnuts exports to the SADC region from 2005 to 2014 The figure indicates that South Africa exports groundnuts more greatly to Mozambique and Zimbabwe Exports of groundnuts to Zambia were very lower during the period under analysis The figure further indicates that Angola is also an important market for South African groundnuts Exports groundnuts from South Africa to the SADC countries with the exception of Mozambique were very low between the years 2011 and 2014

Source Quantec Easy data

Figure 13 shows exports of groundnuts by province from 2005 to 2014

Source Quantec Easy data

0

500

1000

1500

2000

2500

3000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Vo

lum

e (

ton

s)

Period (Years)

Figure 12 Volume of groundnuts exports to the SADC region

Angola Mozambique Zambia Zimbabwe

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

180000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 13 Value of groundnuts exports by Provinces

Western Cape Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

12

Figure 13 above indicates that Gauteng province is the greatest exporters of groundnuts produced in South Africa followed by Northern Cape and Kwazulu-Natal The figure further indicates that exports from the largest producer (Free State) were very low throughout the period under analysis and this mainly influenced by lack of necessary marketing infrastructure It is also clear that the values of exports from different provinces were fluctuating throughout the period under analysis with those from Mpumalanga being at the lowest level throughout the period under analysis Figure 14 presents the value of groundnuts exports in Gauteng province from 2005 to 2014 The figure indicates that City of Tshwane is the major exporters of groundnuts as compared to other district Generally exports of groundnuts from Gauteng province were highly volatile throughout the period under analysis The figure also indicates that Ekurhuleni and West Rand also contributes significantly towards Gauteng provincersquos total value of groundnuts exports The period under analysis closed with City of Johannesburg commanding the greatest share of Gautengrsquos value of groundnuts exports

Source Quantec Easy data

Figure 15 below shows value of groundnut exports from North West province during the period 2005 to 2014 Observable from the figure is very low and erratic trend with regard to exports of groundnuts from various districts in the province Dr Ruth Segomotsi Mompati District Municipality was the greatest exporter of groundnuts from North West province between 2012 and 2014 Exports of groundnuts from Dr Kenneth Kaunda district declined dramatically during the year 2006 and remained very low for the rest of the period under analysis

0

20000000

40000000

60000000

80000000

100000000

120000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 14 Value of groundnuts exports from Gauteng

West Rand Ekurhuleni City of Johannesburg City of Tshwane

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

13

Source Quantec Easy data

Values of groundnut exports from KwaZulu-Natal Province for the period 2005 to 2014 are shown in Figure 16 below Figure 16 indicates value of groundnuts exports from Kwazulu-Natal during 2005 to 2014The figure indicates that the value of groundnuts export during the period of analysis was highly volatile The figure indicates that eThekwini commands the greatest value of groundnuts exports from the provinces followed by Umgungundlovu iLembe The period under review closed with lower levels of groundnuts exports from KwaZulu-Natal Province

Source Quantec Easy data

0

2000000

4000000

6000000

8000000

10000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 15 Value of groundnuts exports from North West Province

Bojanala Ngaka Modiri Molema Dr Ruth Segomotsi Mompati Dr Kenneth Kaunda

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(Ran

ds)

Period (Years)

Figure 16 Value of groundnuts exports from Kwazulu-Natal Province

UMgungundlovu Uthukela iLembe eThekwini

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

14

Source Quantec Easy data

Figure 17 indicates value of groundnuts exports from Western Cape during 2005 to 2014The figure indicates that City of Cape Town was the major exporter of groundnuts in Western Cape for a better part of the period under analysis The figure further indicates that Cape Winelands exported only from 2010 until 2014 while Eden district exported only in 2012

Source Quantec Easy data

Figure 18 shows value of groundnuts exports from Free State during 2005 to 2014The figure indicates that generally Free State is not major exporters of groundnuts Despite the facts that is the largest

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

City of Cape Town 3246 11677 18445 5246 12712 18521 55273 974 1149 105846

West Coast 0 0 0 0 0 0 0 0 0 0

Cape Winelands 0 0 0 0 0 45420 6213 25250 677 245438

Eden 0 0 0 0 0 0 0 23573 0 0

0

50000

100000

150000

200000

250000

300000

Exp

ort

s V

alu

e (R

and

s)

Period (Years)

Figure 17 Value of groundnuts exports from Western Cape Province

City of Cape Town West Coast Cape Winelands Eden

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Exp

ort

Val

ue

(R

and

s)

Period (Years)

Figure 18 Value of groundnuts exports from Free State

Lejweleputswa Thabo Mofutsanyane Fezile Dabi Mangaung

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

15

producer of groundnuts in South Africa Exports of groundnuts in Free State originate only from four districts Lejweleputswa Thabo Mofutsanyane Fezile Dabi and Mangaung Lejweleputswa exported only in 2010 and 2013 while Mangaung recorded exports only in 2014

Source Quantec Easy data

Figure 19 shows value of groundnuts exports from Northern Cape during 2005 to 2014The figure indicates that out of all the districts in Northern Cape only one district (Frances Baard) exports groundnuts The figure further indicates that Frances Baard recorded highest value of groundnuts exports during the year 2012 The period under review closed with lower imports of groundnuts from Northern Cape

23 Share Analysis

Table 2 Contribution of various provinces to South Africarsquos total value of groundnuts export ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Province

Western Cape

000 002 003 000 001 003 003 003 003 025

Northern Cape

830 882 1176 1161 1421 2279 3155 3244 2511 3564

Free State 019 000 019 000 000 283 000 045 470 072

Kwazulu-Natal

2849 2950 1612 000 809 1075 1125 416 550 505

North West 2276 2344 3258 000 000 000 001 423 303 284

Gauteng 4025 3822 3933 6360 7769 6359 5652 5868 6107 5550

Source Calculated from Quantec Easy data

0

10000000

20000000

30000000

40000000

50000000

60000000

70000000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exp

ort

s V

alu

e (

Ran

ds)

Period (Years)

Figure 19 Value of groundnuts exports from Northern Cape Province

Frances Baard

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

16

Table 2 confirms the earlier observation that Gauteng province is the largest contributor towards South Africarsquos total value of groundnuts exports followed by Kwazulu-Natal and Northern Cape provinces The table further indicates that the share of groundnuts exports from other provinces remained minimal throughout the period under review Northern Cape Provincersquos share of groundnuts exports have been increasing since 2005 until 2012 followed by a slight decline in 2013 and an increase in 2014 During the year 2005 Northern Capersquos contribution to South Africarsquos total groundnuts exports was 830 and this has increased to 3244 in 2012 This scenario is not surprising since Northern Cape Province has recently emerged to be one of the biggest producers of groundnuts having accounted for 3564 of South Africarsquos total groundnuts production during 201415 season Table 3 Contribution of various districts to Gauteng Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 District

West Rand 803 1207 1081 4646 3301 4251 2656 424 1239 028

Ekurhuleni 858 1830 1496 007 3692 3565 4473 6245 6385 259

City of Johannesburg

1472 908 752 098 084 009 031 029 033 4944

City of Tshwane

6867 6055 6671 5249 2923 2175 2840 3301 2443 4769

Source Calculated from Quantec Easy data

Table 3 shows that out of five districts in Gauteng province four districts are contributing to the total groundnuts exports of the province The table indicates that City of Tshwane commanded the greatest share of Gautengrsquos total groundnuts exports value between 2005 and 2008 The table further indicates that the Ekurhuleni district municipality has commanded the greatest share of the Provincersquos total value of groundnuts exports between 2009 and 2013 During the year 2014City of Johannesburgrsquos share of Gautengrsquos total groundnuts exports was 4944 followed by City of Tshwane and West Rand whose contributions to Gautengrsquos groundnuts exports were 4769 and 259 respectively Table 4 Contribution of various districts to KwaZulu-Natal Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Districts

UMgungundlovu 123 000 000 2677 000 386 007 000 000 541

UMzinyathi 000 000 000 000 000 000 000 000 450 000

ILembe 000 000 099 000 000 000 000 000 000 000

EThekwini 9871 100 9900 7323 100 9614 9997 100 9550 9459

Source Calculated from Quantec Easy data

Table 4 shows that out of 11 districts in Kwazulu-Natal only five districts are contributing to the total groundnuts exports by the province The figure further indicates that Kwazulu-Natal province has exports of groundnuts originating mainly from EThekwini district primarily due to the use of the Durban harbor as a viaduct of produce that are transported from the Randfontein grain market for export purposes The table indicates that UMgungundlovu UMzinyathi and ILembe Districts contributed

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

17

insignificantly towards the provincersquos value groundnuts exports During the year 2014 EThekwini commanded the greatest share of Kwazulu-Natal total groundnuts exports 9459 while UMgungundlovu district contributed 541 Table 5 below demonstrates the contribution of various districts to the Northern Capersquos total value of groundnut exports The table shows that out of all districts in Northern Cape only one district is contributing to the total groundnuts exports by the province The province only started to export groundnuts from 2005 until 2014 through Frances Baard District which shows a very maximum performance in terms of exports contributing 100 to the Northern Capersquos total value groundnut exports Table 5 Contribution of various districts to the Northern Cape Provincersquos total value of groundnut exports ()

Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Districts

Frances Baard

100 100 100 100 100 100 100 100 100 100

Source Calculated from Quantec Easydata

2 4 Imports

The quantities of groundnuts imported and import values from 2004 to 2013 pursue the pattern which is shown in Figure 20 below

Source Statistics amp Economic Analysis Quantec Easydata

0

50000000

100000000

150000000

200000000

250000000

300000000

0

5000

10000

15000

20000

25000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Val

ue

(R

and

s)

Imp

ort

Vo

lum

e (

ton

s)

Period(Years)

Figure 20 Groundnuts imports for the period 2005-2014

Import Quantity (tons) Import Value (Rands)

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

18

On average South Africa imports approximately 10 722 tons of groundnuts per annum to the value of about R97 million Figure 20 indicates that groundnut imports fluctuated considerably from the year 2005 until 2014 This occurred as a result of fluctuations in production volumes which were caused by inconsistent weather conditions over the period The highest quantities of ground were imported during the years 2006 while the lowest were imported in 2010 South Africa imports groundnuts from the following regions Europe Asia the Americas and Africa particularly from the SADC region Figure 21 indicates that over the past ten years South Africa has been importing groundnuts consistently from Africa the Americas Asia and Europe The major groundnuts import market for South Africa is Africa followed by Asia and the Americas On average South Africa imports about 6 457 tons of groundnuts annually from Africa while imports from Americas and Asia are about 2 343 tons and 1 239 tons per annum respectively

Source Quantec Easy Data

Figure 22 below indicates that on the African Continent South Africa imports groundnuts from the following Countries Malawi Mozambique Zimbabwe Tanzania and Zambia from the SADC region The figure indicates that over the past ten years South Africa has been importing groundnuts consistently from Malawi and Mozambique It is also clear from the figure that groundnut imports from the SADC countries fluctuated considerably over the period under review with the lowest import volumes originating from Zambia Zimbabwe Malawi and Tanzania

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Imp

ort

Vo

lum

es

(To

ns)

Period (Years)

Figure 21 Volume of groundnuts imports from various regions

Africa Americas Asia Europe

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

19

Source Quantec Easy Data

Source Quantec Easy Data

In Eastern Asia groundnut imports originate mainly from China with some fractional intermittent imports originating from other Eastern Asian countries such as Hong Kong and Japan Figure 23 above

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Malawi 1503 3107 3659 1368 653 674 5491 3404 2114 794

Mozambique 304 409 8977 1188 833 0 952 3554 9117 1579

United Republic of Tanzania 0 0 0 115 0 0 48 2752 416 0

Zambia 0 1041 370 0 0 0 0 184 250 1019

Zimbabwe 0 1 0 61 58 0 865 32 30 12

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000 Im

po

rt V

olu

mes (

To

ns)

Period (Years)

Figure 22 Volume of groundnuts imports from the SADC region

Malawi Mozambique United Republic of Tanzania Zambia Zimbabwe

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

China 1697 1793 1041 490 998 956 745 661 232 273

Hong Kong 0 0 0 0 0 0 0 0 0 0

Japan 0 18 0 18 18 36 18 18 36 0

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Imp

ort

Vo

lum

e (

To

ns)

Period (Years)

Figure 23 Volume of groundnuts imports from Eastern Asia

China Hong Kong Japan

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

20

indicates that volume of groundnut imports from China were at the highest level in 2006 and thereafter declined rapidly to lower levels until the year 2014 The period under review closed with lower imports of groundnuts from Eastern Asia

Source Quantec Easy Data

Figure 26 indicates that South Africarsquos groundnut imports from South America originate mainly from Argentina and Brazil The groundnuts imports volumes from South America were very low from 2005 The highest imports of groundnuts from South America were experienced in 2006 from Argentina followed by a huge decline in 2007 The volume of groundnuts imports from Brazil improved marginally between 2006 and 2007 seasons The figure further indicates that the imports of groundnuts were lower between 2008 and 2014 South Africa imported lower volumes of groundnuts from South America during the year 2010 when less than 1000 tons of groundnuts were imported from both Argentina and Brazil combined The figure further shows that there were no imports of groundnuts from Brazil during closing the year (2014) while those from Argentina were also lower

25 Processing

Groundnuts are a high value crop that can be marketed with little processing but are extremely versatile and can be used in a wide range of products The oil made from them can be used for cooking and they can be used to make peanut butter In South Africa processing facilities mainly belong to various companies that produce a wide range of products These include companies that produce peanuts sweets peanut-butter and cooking oil just to mention few Oil contains high amounts of energy and fat-soluble vitamins (A D E and K) and essential fatty acids The oil content of the kernels is between 45 and 55 The peanuts are prepared for the oil extraction process by being shelled and cleaned Oil production requires some type of press with which to extract

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Argentina 3624 67175 10862 36829 10537 14384 0 003 24986 13861

Brazil 0 27632 13344 144 0 0 0 006 0 0

0

1000

2000

3000

4000

5000

6000

7000

8000

Imp

ort

s V

olu

me (

To

ns)

Period (Years)

Figure 24 Volume of groundnuts imports from South America

Argentina Brazil

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

21

the oil from the groundnuts and filtering equipment The alternative uses of groundnuts are detailed in the following diagram (Figure 25) As indicated in Figure 25 groundnuts can be used in various ways at different levels within the industry They can be boiled or roasted for immediate consumption or used as raw material of various products in the industry Oil extracted from the groundnut can be used as raw material for manufacturing of soap massage oil for polio patients body shaving and hair creams and fluid diet which is used to physically strengthen patients and to sharpen their appetites before and after operations The oil cake which is by-product of oil extraction process is used to make glue for wood animal feed fertilizers and antibiotics

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

22

Figure 25 Groundnut Value Chain tree explaining its uses

Source Grain SA and African Groundnut Council

Oil extraction

Groundnut Oil Cooking oil

Massage oil

Body shave

and hair

creams

PetrolDiesel

Fluid diet

(For Patients)

Oil Cake

Animal

feed

Fertilizers

Antibiotics

Glue for

Wood

Groundnut

Shells

Fertilizers

Peanuts

Peanut -

Butter

Spread on

Bread Ice Cream

Products

Biscuits

Boiled and

Salted

Soap

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

23

26 Market Value Chain

Figure 26 Market value chain for groundnuts

Farmers produce groundnuts and after harvesting and drying they grade the groundnut pods at a prescribed moisture level in the kernels After grading the pods are packed in gunny bags The packed groundnuts are then sold to either the local market (processors) or foreign market or they may be stored for on-farm processing and future sales The processed groundnut products are sold in an acceptable form to the consumers

Research and

Biotechnology

Input suppliers

FarmersProducers

Silo Owners

Import and

Export Market

Traders and

Transport

Local Market

Peanut-making

Industry

Other

Processors

Oil industry

RetailWholesale

Consumer

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

24

3 Market Intelligence

31 Tariffs

The following Table 6 indicates the tariffs that are applied by South Africa to the imports of groundnuts from other countries during the year 2015 South Africa generally applies an import duty of 1000 Ad valorem on imports of groundnuts However imports of groundnuts from member-countries of the following regional structures may enter South Africa free of duty SACU European Union and SADC This is due to free trade agreements that exist between South Africa and abovementioned regional structures Table 6 Tariffs applied by South Africa to groundnut imports

Selected Product description

Tariff regime description Applied Tariff Total ad valorem equivalent tariff (estimated)

Groundnuts not roasted or otherwise cooked 120230

MFN duties (Applied) 1000 1000

Intra SACU rate 000 000

Preferential tariff for European Union Countries

000 000

Preferential tariff for SADC countries

000 000

Source ITC Market Access Map

The following Table 7 indicates the tariffs that are applied by various countries to the exports of groundnuts originating from South Africa in 2014 Table 7 Tariffs applied to South African groundnut exports

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Netherlands 1202410000 Ground-nuts in shell (excl seed)

MFN duties (Applied)

000 000

Japan 1202 Ground-nuts not roasted

MFN duties (Applied)

6 02315$Ton 41914

Mozambique 12022090 Ground-nuts not roasted

MFN duties (Applied)

2000 2000

Preferential tariff for South Africa

000 000

25

Importers Selected product codes

Product description

Trade regime description

Applied tariffs Total ad valorem equivalent tariff

Swaziland 12024200 Ground-nuts not roasted

MFN duties (Applied)

1000 1000

Intra SACU rate

000 000

Norway 12024210

Ground-nuts not roasted

MFN duties (Applied)

44908$Ton 1950

Preferential tariff for SACU countries

40299$Ton 1750

Source ITC Market Access Map

Table 7 above shows that South Africa does not face any tariff barriers when exporting groundnuts to countries such as Netherlands Mozambique and Swaziland This is mainly due to the fact that some of these countries do not charge any tariffs on imports of groundnuts originating from other countries South Africa enjoys a preferential tariff of 0 ad valorem when exporting groundnuts to Mozambique and Swaziland due to the existence of SADC Free Trade Agreement Norway and Japanrsquos groundnuts industries are heavily protected by higher import duties that are charged by these countries on imports of groundnuts from elsewhere Japan applies an import duty of 41914 Ad Valorem on imports of groundnuts originating from other countries while Norway applies tariffs ranging between 1750 and 1950 on imports of groundnuts originating from South Africa There is a preferential tariff of 1750 in Norway on groundnuts imports originating from SACU countries

26

32 Performance of the groundnut industry

Figure 27 Competitiveness of supplying countries for SA groundnut imports 2014

Source ITC Trade Map

27

Figure 27 and Table 8 indicate that imports of groundnuts from India Namibia and Mozambique increased significantly between the years 2010 and 2014 Groundnuts imports from India increased by about 152 in quantity between the years 2010 and 2014 while those from Namibia and Mozambique increased by 113 and 28 respectively Table 8 List of supplying markets for the groundnut imported by South Africa in 2014

Exporters

Trade Indicators

Imported value 2014

(USD thousand)

Share in South

Africas imports

()

Imported quantity

2014

Unit value (USDunit)

Imported growth in value between

2010-2014 (

pa)

Imported growth

in quantity between

2010-2014 (

pa)

Imported growth in

value between

2013-2014 (

pa)

World 8020 100 10 395 772 37 53 -62

India 1985 248 2052 967 152 7

Namibia 1489 186 2977 500 113 443

United States of America

1332 166 1101 1210 -71-

Mozambique 945 118 1579 598 28 -89

Malawi 806 10 794 1015 -3 -6 -64

Zambia 607 76 1019 596 356-

China 375 47 273 1374 -30 -31 -46

Argentina 175 22 139 1259 93 -1 -41

Source ITC Trade Map

Table 8 and Figure 28 also show that India is the biggest supplier of groundnuts imported by South Africa in 2014 It is clear from the figure and the table that India accounted for about 248 of the total groundnuts imported by South Africa during the year 2014 The other major exporters of groundnuts to South Africa are Namibia and United States of America which account for 186 and 166 of South Africarsquos total groundnuts imports respectively South Africa also imports groundnuts from other countries such Mozambique Malawi and Zambia

28

Figure 28 Prospects for diversification of suppliers of groundnut imported by South Africa 2014

Source ITC Trade Map

29

Table 9 List of Importing markets for the groundnut exported by South Africa in 2014

Importers

Trade Indicators

Exported value 2014

(USD thousand)

Share in South

Africas exports

()

Exported quantity

2014

Unit value

(USDunit)

Exported growth in

value between

2010-2014 ( pa)

Exported growth in quantity between

2010-2014 ( pa)

Exported growth in

value between 2013-2014 (

pa)

World 13081 100 9844 1329 -23 -25 -12

Japan 4912 376 2638 1862 -15 -20 -7

Netherlands 3530 27 2086 1692 -24 -28 -43

Mozambique 1094 84 2956 370 10 45 -19

Belgium 1030 79 540 1907 62 62

Egypt 602 46 397 1516 67 82

United Kingdom

455 35 286 1591 -62 -40

Norway 345 26 179 1927 -16 -21 -35

New Zealand 255 19 126 2024 0 -5 4

Namibia 175 13 74 2365 28 41 1491

Source ITC Trade Map

It is clear from Table 9 and Figure 29 that the major export destinations for groundnuts originating from South Africa are Netherlands Japan Mozambique Belgium and Egypt with the greatest volumes being exported to Japan and Netherlands In 2014 Japan alone absorbed 376 of South Africarsquos total groundnut exports followed Netherlands and Mozambique with 27 and 84 respectively South Africarsquos value of groundnuts exports to the world declined by 23 in value terms between the years 2010 and 2014 The figure and the table further show that between the years 2013 and 2014 the value of the South African groundnut exports to the world declined by 12 while those towards Japan also declined by 7 over the same period Figure 29 further shows that South Africarsquos groundnuts exports to countries such as Netherlands Japan Norway New Zealand Zimbabwe and Finland have grown at a slow pace compared to these countriesrsquo imports growth from the rest of the world The growth rate of South Africarsquos groundnut exports to countries such as Mozambique and Egypt is more than the growth in these countriesrsquo imports from the rest of the world The figure further shows that if South Africa wishes to expand its groundnut export base the prospective markets exist in countries such as Botswana Swaziland Malawi Algeria Taipei Chinese and Namibia

30

Figure 29 Prospects for market diversification for Groundnuts (1202) exported by South Africa in 2014

Source ITC Trade Map

31

4 ACKNOWLEDGEMENTS The following organizations are acknowledged Statistics and Economic Analysis Department of Agriculture Forestry and Fisheries Tel (012) 319 8453 Fax (012) 319 8031 wwwdaffgovza Grain South Africa wwwgrainsacoza African Groundnut Council wwwafgroundnutcouncilorg Quantec Easydata POBox 35466 Menlo Park Pretoria 0102 Tel 012 361 5154 Fax 012 348 5874 Website wwwquanteccoza ITC Trade Map Website httpwwwtrademaporg ITC Market Access Map wwwmacmaporg Disclaimer This document and its contents have been compiled by the Department of Agriculture Forestry and Fisheries for the purpose of detailing the groundnut industry Anyone who uses the information as contained in this document does so at hisher own risk The views expressed in this document are those of the Department with regard to the industry unless otherwise stated The Department therefore accepts no liability that can be incurred resulting from the use of this information

27

Figure 27 and Table 8 indicate that imports of groundnuts from India Namibia and Mozambique increased significantly between the years 2010 and 2014 Groundnuts imports from India increased by about 152 in quantity between the years 2010 and 2014 while those from Namibia and Mozambique increased by 113 and 28 respectively Table 8 List of supplying markets for the groundnut imported by South Africa in 2014

Exporters

Trade Indicators

Imported value 2014

(USD thousand)

Share in South

Africas imports

()

Imported quantity

2014

Unit value (USDunit)

Imported growth in value between

2010-2014 (

pa)

Imported growth

in quantity between

2010-2014 (

pa)

Imported growth in

value between

2013-2014 (

pa)

World 8020 100 10 395 772 37 53 -62

India 1985 248 2052 967 152 7

Namibia 1489 186 2977 500 113 443

United States of America

1332 166 1101 1210 -71-

Mozambique 945 118 1579 598 28 -89

Malawi 806 10 794 1015 -3 -6 -64

Zambia 607 76 1019 596 356-

China 375 47 273 1374 -30 -31 -46

Argentina 175 22 139 1259 93 -1 -41

Source ITC Trade Map

Table 8 and Figure 28 also show that India is the biggest supplier of groundnuts imported by South Africa in 2014 It is clear from the figure and the table that India accounted for about 248 of the total groundnuts imported by South Africa during the year 2014 The other major exporters of groundnuts to South Africa are Namibia and United States of America which account for 186 and 166 of South Africarsquos total groundnuts imports respectively South Africa also imports groundnuts from other countries such Mozambique Malawi and Zambia

28

Figure 28 Prospects for diversification of suppliers of groundnut imported by South Africa 2014

Source ITC Trade Map

29

Table 9 List of Importing markets for the groundnut exported by South Africa in 2014

Importers

Trade Indicators

Exported value 2014

(USD thousand)

Share in South

Africas exports

()

Exported quantity

2014

Unit value

(USDunit)

Exported growth in

value between

2010-2014 ( pa)

Exported growth in quantity between

2010-2014 ( pa)

Exported growth in

value between 2013-2014 (

pa)

World 13081 100 9844 1329 -23 -25 -12

Japan 4912 376 2638 1862 -15 -20 -7

Netherlands 3530 27 2086 1692 -24 -28 -43

Mozambique 1094 84 2956 370 10 45 -19

Belgium 1030 79 540 1907 62 62

Egypt 602 46 397 1516 67 82

United Kingdom

455 35 286 1591 -62 -40

Norway 345 26 179 1927 -16 -21 -35

New Zealand 255 19 126 2024 0 -5 4

Namibia 175 13 74 2365 28 41 1491

Source ITC Trade Map

It is clear from Table 9 and Figure 29 that the major export destinations for groundnuts originating from South Africa are Netherlands Japan Mozambique Belgium and Egypt with the greatest volumes being exported to Japan and Netherlands In 2014 Japan alone absorbed 376 of South Africarsquos total groundnut exports followed Netherlands and Mozambique with 27 and 84 respectively South Africarsquos value of groundnuts exports to the world declined by 23 in value terms between the years 2010 and 2014 The figure and the table further show that between the years 2013 and 2014 the value of the South African groundnut exports to the world declined by 12 while those towards Japan also declined by 7 over the same period Figure 29 further shows that South Africarsquos groundnuts exports to countries such as Netherlands Japan Norway New Zealand Zimbabwe and Finland have grown at a slow pace compared to these countriesrsquo imports growth from the rest of the world The growth rate of South Africarsquos groundnut exports to countries such as Mozambique and Egypt is more than the growth in these countriesrsquo imports from the rest of the world The figure further shows that if South Africa wishes to expand its groundnut export base the prospective markets exist in countries such as Botswana Swaziland Malawi Algeria Taipei Chinese and Namibia

30

Figure 29 Prospects for market diversification for Groundnuts (1202) exported by South Africa in 2014

Source ITC Trade Map

31

4 ACKNOWLEDGEMENTS The following organizations are acknowledged Statistics and Economic Analysis Department of Agriculture Forestry and Fisheries Tel (012) 319 8453 Fax (012) 319 8031 wwwdaffgovza Grain South Africa wwwgrainsacoza African Groundnut Council wwwafgroundnutcouncilorg Quantec Easydata POBox 35466 Menlo Park Pretoria 0102 Tel 012 361 5154 Fax 012 348 5874 Website wwwquanteccoza ITC Trade Map Website httpwwwtrademaporg ITC Market Access Map wwwmacmaporg Disclaimer This document and its contents have been compiled by the Department of Agriculture Forestry and Fisheries for the purpose of detailing the groundnut industry Anyone who uses the information as contained in this document does so at hisher own risk The views expressed in this document are those of the Department with regard to the industry unless otherwise stated The Department therefore accepts no liability that can be incurred resulting from the use of this information

28

Figure 28 Prospects for diversification of suppliers of groundnut imported by South Africa 2014

Source ITC Trade Map

29

Table 9 List of Importing markets for the groundnut exported by South Africa in 2014

Importers

Trade Indicators

Exported value 2014

(USD thousand)

Share in South

Africas exports

()

Exported quantity

2014

Unit value

(USDunit)

Exported growth in

value between

2010-2014 ( pa)

Exported growth in quantity between

2010-2014 ( pa)

Exported growth in

value between 2013-2014 (

pa)

World 13081 100 9844 1329 -23 -25 -12

Japan 4912 376 2638 1862 -15 -20 -7

Netherlands 3530 27 2086 1692 -24 -28 -43

Mozambique 1094 84 2956 370 10 45 -19

Belgium 1030 79 540 1907 62 62

Egypt 602 46 397 1516 67 82

United Kingdom

455 35 286 1591 -62 -40

Norway 345 26 179 1927 -16 -21 -35

New Zealand 255 19 126 2024 0 -5 4

Namibia 175 13 74 2365 28 41 1491

Source ITC Trade Map

It is clear from Table 9 and Figure 29 that the major export destinations for groundnuts originating from South Africa are Netherlands Japan Mozambique Belgium and Egypt with the greatest volumes being exported to Japan and Netherlands In 2014 Japan alone absorbed 376 of South Africarsquos total groundnut exports followed Netherlands and Mozambique with 27 and 84 respectively South Africarsquos value of groundnuts exports to the world declined by 23 in value terms between the years 2010 and 2014 The figure and the table further show that between the years 2013 and 2014 the value of the South African groundnut exports to the world declined by 12 while those towards Japan also declined by 7 over the same period Figure 29 further shows that South Africarsquos groundnuts exports to countries such as Netherlands Japan Norway New Zealand Zimbabwe and Finland have grown at a slow pace compared to these countriesrsquo imports growth from the rest of the world The growth rate of South Africarsquos groundnut exports to countries such as Mozambique and Egypt is more than the growth in these countriesrsquo imports from the rest of the world The figure further shows that if South Africa wishes to expand its groundnut export base the prospective markets exist in countries such as Botswana Swaziland Malawi Algeria Taipei Chinese and Namibia

30

Figure 29 Prospects for market diversification for Groundnuts (1202) exported by South Africa in 2014

Source ITC Trade Map

31

4 ACKNOWLEDGEMENTS The following organizations are acknowledged Statistics and Economic Analysis Department of Agriculture Forestry and Fisheries Tel (012) 319 8453 Fax (012) 319 8031 wwwdaffgovza Grain South Africa wwwgrainsacoza African Groundnut Council wwwafgroundnutcouncilorg Quantec Easydata POBox 35466 Menlo Park Pretoria 0102 Tel 012 361 5154 Fax 012 348 5874 Website wwwquanteccoza ITC Trade Map Website httpwwwtrademaporg ITC Market Access Map wwwmacmaporg Disclaimer This document and its contents have been compiled by the Department of Agriculture Forestry and Fisheries for the purpose of detailing the groundnut industry Anyone who uses the information as contained in this document does so at hisher own risk The views expressed in this document are those of the Department with regard to the industry unless otherwise stated The Department therefore accepts no liability that can be incurred resulting from the use of this information

29

Table 9 List of Importing markets for the groundnut exported by South Africa in 2014

Importers

Trade Indicators

Exported value 2014

(USD thousand)

Share in South

Africas exports

()

Exported quantity

2014

Unit value

(USDunit)

Exported growth in

value between

2010-2014 ( pa)

Exported growth in quantity between

2010-2014 ( pa)

Exported growth in

value between 2013-2014 (

pa)

World 13081 100 9844 1329 -23 -25 -12

Japan 4912 376 2638 1862 -15 -20 -7

Netherlands 3530 27 2086 1692 -24 -28 -43

Mozambique 1094 84 2956 370 10 45 -19

Belgium 1030 79 540 1907 62 62

Egypt 602 46 397 1516 67 82

United Kingdom

455 35 286 1591 -62 -40

Norway 345 26 179 1927 -16 -21 -35

New Zealand 255 19 126 2024 0 -5 4

Namibia 175 13 74 2365 28 41 1491

Source ITC Trade Map

It is clear from Table 9 and Figure 29 that the major export destinations for groundnuts originating from South Africa are Netherlands Japan Mozambique Belgium and Egypt with the greatest volumes being exported to Japan and Netherlands In 2014 Japan alone absorbed 376 of South Africarsquos total groundnut exports followed Netherlands and Mozambique with 27 and 84 respectively South Africarsquos value of groundnuts exports to the world declined by 23 in value terms between the years 2010 and 2014 The figure and the table further show that between the years 2013 and 2014 the value of the South African groundnut exports to the world declined by 12 while those towards Japan also declined by 7 over the same period Figure 29 further shows that South Africarsquos groundnuts exports to countries such as Netherlands Japan Norway New Zealand Zimbabwe and Finland have grown at a slow pace compared to these countriesrsquo imports growth from the rest of the world The growth rate of South Africarsquos groundnut exports to countries such as Mozambique and Egypt is more than the growth in these countriesrsquo imports from the rest of the world The figure further shows that if South Africa wishes to expand its groundnut export base the prospective markets exist in countries such as Botswana Swaziland Malawi Algeria Taipei Chinese and Namibia

30

Figure 29 Prospects for market diversification for Groundnuts (1202) exported by South Africa in 2014

Source ITC Trade Map

31

4 ACKNOWLEDGEMENTS The following organizations are acknowledged Statistics and Economic Analysis Department of Agriculture Forestry and Fisheries Tel (012) 319 8453 Fax (012) 319 8031 wwwdaffgovza Grain South Africa wwwgrainsacoza African Groundnut Council wwwafgroundnutcouncilorg Quantec Easydata POBox 35466 Menlo Park Pretoria 0102 Tel 012 361 5154 Fax 012 348 5874 Website wwwquanteccoza ITC Trade Map Website httpwwwtrademaporg ITC Market Access Map wwwmacmaporg Disclaimer This document and its contents have been compiled by the Department of Agriculture Forestry and Fisheries for the purpose of detailing the groundnut industry Anyone who uses the information as contained in this document does so at hisher own risk The views expressed in this document are those of the Department with regard to the industry unless otherwise stated The Department therefore accepts no liability that can be incurred resulting from the use of this information

30

Figure 29 Prospects for market diversification for Groundnuts (1202) exported by South Africa in 2014

Source ITC Trade Map

31

4 ACKNOWLEDGEMENTS The following organizations are acknowledged Statistics and Economic Analysis Department of Agriculture Forestry and Fisheries Tel (012) 319 8453 Fax (012) 319 8031 wwwdaffgovza Grain South Africa wwwgrainsacoza African Groundnut Council wwwafgroundnutcouncilorg Quantec Easydata POBox 35466 Menlo Park Pretoria 0102 Tel 012 361 5154 Fax 012 348 5874 Website wwwquanteccoza ITC Trade Map Website httpwwwtrademaporg ITC Market Access Map wwwmacmaporg Disclaimer This document and its contents have been compiled by the Department of Agriculture Forestry and Fisheries for the purpose of detailing the groundnut industry Anyone who uses the information as contained in this document does so at hisher own risk The views expressed in this document are those of the Department with regard to the industry unless otherwise stated The Department therefore accepts no liability that can be incurred resulting from the use of this information

31

4 ACKNOWLEDGEMENTS The following organizations are acknowledged Statistics and Economic Analysis Department of Agriculture Forestry and Fisheries Tel (012) 319 8453 Fax (012) 319 8031 wwwdaffgovza Grain South Africa wwwgrainsacoza African Groundnut Council wwwafgroundnutcouncilorg Quantec Easydata POBox 35466 Menlo Park Pretoria 0102 Tel 012 361 5154 Fax 012 348 5874 Website wwwquanteccoza ITC Trade Map Website httpwwwtrademaporg ITC Market Access Map wwwmacmaporg Disclaimer This document and its contents have been compiled by the Department of Agriculture Forestry and Fisheries for the purpose of detailing the groundnut industry Anyone who uses the information as contained in this document does so at hisher own risk The views expressed in this document are those of the Department with regard to the industry unless otherwise stated The Department therefore accepts no liability that can be incurred resulting from the use of this information