Groundnuts: Extraction

The plant that plants its own nuts underground

Groundnuts, or peanuts, are a South American legume now grown across the warm tropics and subtropics. After flowering, the stalks bend into the soil and the pods ripen underground, so loose, sandy, well-drained soils suit them best. Much of the crop is rain-fed and grown by smallholders in India, Nigeria, Sudan and the Sahel, while the US, Argentina and parts of China are mechanised. Plants are lifted, dried in the field and threshed. Poor drying invites the mould that produces aflatoxin, the crop's main quality risk. Nuts are then shelled and either crushed for oil and cake or graded for food.

Groundnut is a legume grown on sandy, well-drained soils in warm climates. Pods form underground, so harvesting means lifting the whole plant. The main routes are mechanised, irrigated or high-input farming in China, the US and Argentina, which reaches 3.5-4.1 t/ha, and smallholder rain-fed farming in India and West Africa, which gets 1.2-2.1 t/ha. After harvest, nuts are shelled and graded: the best go to food and export, the rest are crushed for oil and cake. Aflatoxin control during drying and storage decides which markets a lot can reach.

Methods compared

How each method works

Farms use improved runner and Virginia varieties, fertiliser, irrigation or reliable rain, and machine digging and combining. US growers sell under contracts to shellers and a federal marketing loan programme sets a price floor. China's Shandong and Henan provinces dominate its output.

High yields and consistent quality, but US and Argentine output depends on a few states and provinces and on contract prices.

Families plant local or improved bunch and spreading types with the monsoon, using bullocks or small tractors, and lift pods by hand. Gujarat is India's main area, with Rajasthan, Madhya Pradesh, Tamil Nadu and Karnataka. Many farms sell soon after harvest because they lack storage.

Low input cost and soil nitrogen benefit, but yield swings with the monsoon and aflatoxin risk limits premium exports.

Pods are decorticated by machine, and kernels are sized by count per ounce, sorted by colour machines and by hand, and sometimes blanched to remove the red skins. Export lots need laboratory aflatoxin certificates, and EU-bound cargoes face the strictest checks. Rejected or lower-grade kernels go to crushers instead.

Captures premium food value, but rejection for aflatoxin can strand a whole lot.

Kernels are pressed in screw expellers to give filtered groundnut oil, and the remaining cake is solvent-extracted to recover more oil before it is sold as meal. In Gujarat and China much oil is sold unrefined or lightly filtered for its nutty flavour, while refined oil competes with imported soft oils.

Uses lower grades profitably, but oil competes with cheaper imported oils.

Who does it: global

Who does it: India

India is the second-largest producer (13.07 Mt in-shell in 2025-26) and the second-largest exporter by value (21.4% in 2024). Gujarat's Saurashtra region dominates both crushing and export shelling. Market prices fell below MSP in 2025, which pushed NAFED procurement.