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CHAPTER 1
initiated by the big role-players, a process in which the Groundnut Forum can play
an important coordinating role.
It was also found that great uncertainty regarding pricing prevailed in the ground-
nut industry, specifically regarding pre-season contracts. This plays an important
role in the producers’ decision to plant groundnuts or not. The recommendation
was that a specific price strategy was necessary to enforce a transparent pricing
mechanism and that the possibility of introducing a price-hedging mechanism for
groundnuts should be examined.
Groundnuts cultivated in South Africa are traditionally an export product, and de-
spite the problems in the industry, South Africa is still a net exporter of groundnuts,
because in most years the domestic production exceeds the domestic consumption.
Domestic prices are therefore largely determined by export parity.
The export market makes high demands regarding the quality of the groundnuts,
especially for the presence of aflatoxin. Groundnut exports experienced enormous
problems in 1999 and many consignments were returned to South Africa from
overseas destinations because the quality was not acceptable. In addition to unac-
ceptably high levels of aflatoxin contamination, mixing of cultivars occurred, and
this was also not acceptable to the international buyers, particularly because they
were used to the high quality of South African groundnuts and they often traded
at quite a premium.
By 2013, groundnuts were mainly exported to the Netherlands, Germany, Japan
and Mexico.
Sunflower
Utilisation
In South Africa sunflower seeds are almost exclusively used for manufacturing oil
and oilcake – approximately 95%. The rest is mainly used for human consumption
and in pet food. Sunflower oil is used mainly for human consumption, be it in un-
processed or processed form. However, in South Africa oilcake is exclusively sold
for manufacturing animal feed.
Unlike in the case of soybean oilcake, the production of which has grown substan-
tially since 2005/2006, the production of sunflower oilcake has stayed almost at the
same level and the predictions are that in the future it will vary between 700 000
and 800 000 tons/year.
Production
Sunflower performs better than most other grain crops under unfavourable, dry
climatic conditions, which could possibly explain why it is a popular crop to grow
in the more marginal production areas of South Africa.
Sunflower is a good crop-rotation crop with maize and there is a fair correlation
between the surfaces on which maize and sunflower can respectively be planted,
because producers can easily switch over to sunflower when the optimum planting
date for maize has passed. It also explains in part why sunflower production varies
quite a lot from year to year, as is seen in Graph 26 (on page 60).
In 2008 South Africa was the world’s tenth biggest producer of sunflower seeds,
produced mainly in the Free State, North West and Limpopo and on the Highveld
of Mpumalanga.
Import and export
Traditionally sunflower seeds are exported on a very limited scale by South Af-
rica, especially because their export was viewed as uneconomical as a result of
the mass-volume ratio. Sunflower seeds may only be exported if they satisfy the
prescribed phytosanitary requirements and are certified by PPECB as suitable for
export.
During the first half of 1996 a sharp decline in the rand/dollar exchange rate and a
strong demand for plant-based oil and oilcake in Europe and Britain created a good