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CHAPTER 1
OILSEED PERSPECTIVE: GROUNDNUTS, SUNFLOWER,
SOYBEANS AND CANOLA
Groundnuts
Utilisation
Groundnuts are mainly cultivated for human consumption. They are primarily used
in the production of sweets and breakfast cereal, or in unprocessed form. Statistics
show that approximately 26% of the groundnuts produced in South Africa from the
1990/1991 until the 2001/2002 season were consumed in their unprocessed form
(shelled and unshelled).
The crushing of groundnuts for oil renders approximately equal quantities of
oil and oilcake. The oilcake is mostly used in the manufacturing of products like
peanut butter and animal feed.
Production
The groundnut originally came from South America (Bolivia and adjacent coun-
tries), but is currently cultivated in tropical and warm climatic regions across the
world. In the USA, groundnuts were cultivated in gardens up to approximately
1870, and planted as grazing for pigs up to approximately 1930.
Initially groundnuts were imported from India and other countries in the Middle
East for crushing in South Africa, while the South African producers focused on
the eating market. During the 1920s, the government encouraged the creation and
expansion of oil crushing capacity. Initially growth was slow and it only really took
off during the 1930s.
According to the first report of the Oilseeds Control Board, released in 1952, ground-
nuts were first cultivated for commercial purposes in South Africa during the First
World War. During that period, the price of groundnuts increased significantly amidst
inflationary circumstances, which made the cultivation of it very attractive.
The best prices were achieved in the eating market, which motivated producers
to mostly plant the Virginia Bunch cultivar.A promising export market for these
groundnuts developed in the international eating market, which contributed a lot
to the strengthening of the domestic producer price. This in turn contributed posi-
tively to the increasing of production and the improvement of the general quality
of South African groundnuts.
During the Second World War (1939 - 1945) and the period shortly after that, the
local production of groundnuts was further stimulated by a shortage that arose
from limited imports – firstly due to a lack of space on board ship for imports and
then due to developments in the international markets, particularly in Asia and
Europe. It became clear that the domestic production of groundnuts would have
to be increased to meet the demand, specifically for the crushing industry.
In order to address this need the government started a campaign, at the insistence of
the crushers, to increase the production of groundnuts in South Africa significantly.
The seed of the Natal Common type of groundnut, which offered a higher yield/
hectare, is less susceptible to drought conditions and more suited for oil crushing,
was made available. A guaranteed producer price for shelled groundnuts as well as
other guidelines aimed at supporting the industry was announced before the start
of the production season.
Subsequently the production of groundnuts increased quite quickly from 8 000 tons
of shelled groundnuts in 1946 to 79 000 tons in 1952.
In the ten-year period from 1970/1971 to 1979/1980 an average of 280 000 ha/year
was planted with groundnuts. The largest planting was 373 000 ha in 1970/1971,
and the smallest was in 1976/1977, when only 185 000 ha were planted. During the
next ten years the average annual groundnuts plantings decreased to 221 000 ha,
and in the period from 1990/1991 to 1997/1998 it decreased further to an average
of 161 000 ha/year.