Senegal scraps groundnut export tax as producers face record harvest

SENEGAL – Senegal has removed the four percent export tax on groundnut shipments for the 2025 to 2026 marketing year, as authorities try to clear a crop that has grown far beyond earlier forecasts.

The Ministry of Industry and Trade announced the decision on January 13, saying the measure aims to ease access to foreign markets at a time when local channels struggle to cope with rising volumes.

Groundnuts rank among Senegal’s top farm exports, yet overseas sales have dropped sharply in recent years. Data from the National Agency for Statistics and Demography shows exports reached 336,000 tonnes in 2021 but fell to 121,798 tonnes in 2024. That represents a drop of about sixty four percent in four years.

Export income followed the same trend. Earnings declined from 154.7 billion CFA francs, about US$274.7 million, in 2021 to 65.3 billion CFA francs, about US$115.9 million, in 2024.

For the new season, the authorities want to ship between 300,000 and 450,000 tonnes to the international market. Officials see the tax cut as a way to help reach that target and restore trade flows.

A harvest beyond expectations

The policy change comes as production exceeds earlier estimates. In its statement, the ministry said the country has already recorded more than 900,000 tonnes of groundnuts this season.

“Through this measure, the Government intends to provide a response to the challenge of marketing this year’s production, whose volumes far exceed forecasts with more than 900,000 tons recorded,” the statement said.

The large harvest has raised concern among farmers and traders about market congestion and falling prices, especially if local processors fail to absorb the crop.

SONACOS capacity questioned

To ease pressure, the government asked the National Company for the Marketing of Oilseeds of Senegal, known as SONACOS, to raise its buying target to 450,000 tonnes from an earlier plan of 250,000 tonnes. SONACOS stands as the country’s main oilseed processor.

Farmers remain doubtful. “In two months, SONACOS has only bought 62,000 tons of groundnuts. It would be illusory to think that this company is able to buy 450,000 tons of groundnut seeds,” said the regional coordinator of the farmers’ group Aar Sunu Momel in Thiès, in remarks carried by the Senegalese Press Agency on January 11.

For the 2025 to 2026 season, the state has set the minimum producer price at 305 CFA francs per kilogram, about US$0.51. Producers now watch closely to see whether the tax removal will boost exports enough to steady prices and ease pressure on the domestic market.

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