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Competitiveness and technical efficiency: Determinants in the groundnut oil sector of India


  • Amarender Reddy, A.
  • Bantilan, Ma Cynthia S.


India imports about half of its domestic consumption needs of edible oils. Groundnuts are a major source of edible oils in India. One of the central problems of groundnut production and processing is huge inefficiencies due to an uncertain production environment owing to rainfed cultivation, the low resource base of smallholder farmers and processors, and the low adoption rates of improved technology. This paper addresses critical issues that impair the groundnut sector’s international competitiveness and efficiency. The paper uses primary data collected from Indian farmers and processors of groundnuts to measure efficiency, and it suggests policies for reducing yield gaps and increasing efficiency. Specific policies suggested from the study are (a) the harnessing of improved varieties with attributes like drought tolerance, high oil content, high productivity for large-scale seed multiplication and distribution by public and private agencies; (b) viable village seed banks and seed networks through cycles of post-rainy season seed multiplication to meet the seed requirements in the rainy season and vice versa; (c) adoption of low-cost technologies to increase profitability and reduce risk; (d) oilseed clusters to facilitate scale and scope economies in processing units; and (e) capital subsidies to accelerate technological upgrading to shed inefficiency in the processing sector. The expected gains in efficiency in the production and processing of oilseeds are expected to result in producer and consumer gains which would justify the proposed incentives for seeds and for technological upgrading in the processing sector.

Suggested Citation

  • Amarender Reddy, A. & Bantilan, Ma Cynthia S., 2012. "Competitiveness and technical efficiency: Determinants in the groundnut oil sector of India," Food Policy, Elsevier, vol. 37(3), pages 255-263.
  • Handle: RePEc:eee:jfpoli:v:37:y:2012:i:3:p:255-263
    DOI: 10.1016/j.foodpol.2012.02.004

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    References listed on IDEAS

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    Cited by:

    1. Sharma, P. & Dupare, B.U., 2016. "Total Factor Productivity Growth and Returns from Research Investment on Soybean in India," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 29(1).
    2. repec:bla:afrdev:v:29:y:2017:i:1:p:28-43 is not listed on IDEAS
    3. Rani, Usha & Reddy, G.P. & Prasad, Y.E. & Reddy, A. Amarender, 2014. "Competitiveness of Major Crops in Post-WTO Period in Andhra Pradesh," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 69(1).
    4. repec:wly:agribz:v:33:y:2017:i:4:p:505-521 is not listed on IDEAS
    5. repec:gam:jagris:v:7:y:2017:i:12:p:96-:d:120345 is not listed on IDEAS
    6. Sanzidur Rahman & Mohammad Mizanul Haque Kazal & Ismat Ara Begum & Mohammad Jahangir Alam, 2016. "Competitiveness, Profitability, Input Demand and Output Supply of Maize Production in Bangladesh," Agriculture, MDPI, Open Access Journal, vol. 6(2), pages 1-14, May.
    7. repec:gam:jsusta:v:9:y:2017:i:9:p:1648-:d:112190 is not listed on IDEAS
    8. Singh, Amarendra Pratap & Narayanan, Krishnan, 2016. "How can weather affect crop area diversity? Panel data evidence from Andhra Pradesh, a rice growing state of India," Studies in Agricultural Economics, Research Institute for Agricultural Economics, vol. 118(2), August.
    9. Magdalena Kapelko, 2017. "Dynamic versus static inefficiency assessment of the Polish meat‐processing industry in the aftermath of the European Union integration and financial crisis," Agribusiness, John Wiley & Sons, Ltd., vol. 33(4), pages 505-521, September.

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