This study was conducted to assess the extent of value-addition, employment
generating potential and economics of peanut-candy and salted-peanut
small-scale units in India. In the low-capacity peanut-candy units, the
value-addition at the end of Stage-I (pod to kernel) was $ 2.4/q, whereas, it
was $ 2.2/q in the high-capacity units. In salted-peanut units, the
value-addition in the low- and high-capacity was $2.2/q and $2.3/q,
respectively. In Stage-II (kernel to final product), the value-addition was
high across sizes and type of the processing units. Around 525 and 635
man-days of employment/month/unit were generated by low and high-capacity
peanut-candy units, respectively. The employment generation was less in
salted-peanut vis-?-vis peanut-candy units due to different processing
methods. The kernel alone constituted 50 to 52 per cent of the total cost in
peanut-candy, and 89 per cent in salted-peanut units. The sensitivity
analysis revealed that change in the kernel price directly affected the
magnitude of profits. The important policy implications emerged were: if the
units process the pods to obtain kernel (Stage-I) instead of procuring
kernels from the market, considerable value-addition can be made, kernel
price directly affects the profits and hence an appropriate mechanism like
?contract farming? would stabilise the kernel prices, majority of the units
retrench labour during off-peak period due to less demand and hence
diversification in processing will generate sufficient employment to retain
the existing skilled employees, and appropriate policy intervention is
necessary to address the capital, technology and marketing constraints of the
peanut processing units.
Economics of non-oil value chains in peanut: A case of peanut-candy and salted-peanut small-scale units in India