Groundnut Market Likely to Remain Firm Due to Declining Production in Gujarat

Rajkot. The Solvent Extractors' Association of India (SEA) has estimated that the production of the Kharif-season groundnut crop in Gujarat—the country’s leading groundnut-producing state—will decline by 20.5 percent, falling to approximately 3.33 million tonnes (33.30 lakh tonnes). According to the association, the area sown with groundnuts in the state has shrunk to 2.071 million hectares (20.71 lakh hectares), and the average yield is expected to drop to 1,608 kg per hectare. The groundnut crop has been adversely affected by deficient monsoon rainfall in certain districts of Gujarat, which will lead to a decline in yield.

During the 2025 Kharif season, groundnuts were cultivated across 2.202 million hectares (22.02 lakh hectares) in Gujarat, with an average yield of 1,902 kg per hectare, resulting in a total estimated production of 4.188 million tonnes (41.88 lakh tonnes).

It is noteworthy that Gujarat is the largest groundnut-producing state in India. A significant drop in production there could lead to a firming trend in prices. India also exports groundnuts on a large scale; however, if domestic market prices remain too high, export performance could weaken. Due to a severe shortage of rainfall, the Gujarat government has declared four districts in the state as drought-affected.

In some areas of the Saurashtra region, rainfall has been significantly below the normal average; consequently, groundnut production in this region is projected to decline by 19.8 percent. The area sown with groundnuts in the Saurashtra region stood at 1.578 million hectares (15.78 lakh hectares), with production estimated at 2.553 million tonnes (25.53 lakh tonnes).