Producing countries in Africa strive to increase cashew nuts production and export

Africa is one of the major cashew nuts production worldwide. However, the production process in Africa is still limited, which make reduce profit.

Africa’s cashew industry challenged by low-value addition

President of the African Cashew Alliance (ACA) has identified low-value addition inadequate finance and skills among others as challenges; that have continued to limit the growth of the African cashew industry. 

– Africa still processes less than 10 percent of its cashew nuts despite being the largest producer of the commodity. Despite the supply chain obstruction caused by the pandemic, the industry was able to show resilience owing to increased global demand; particularly from the US, Europe and Middle East countries.

Africa’s cashew industry challenged by low-value addition

– Processing factories in Africa are still challenged with issues of inadequate access to finance; lack of processing equipment, technical knowledge and skills, storage systems among others. To address some of these challenges in the industry, ACA has developed diverse learning and information sharing platforms for cashew stakeholders. 

– Next year, ACA will introduce the ACA Quarterly Policy Roundtable (QPR) that the purpose of the forum is to develop sustainable and inclusive policies. It offers an opportunity to improve the literature and strategic plan of cashew stakeholders. Through this forum, they will address issues around price mechanism, value chain analysis and sustainability, capacity building and access to finance.

– Also, there is the ACA Annual Conference held every September in cashew producing countries. The ACA conference continues to be a great place to learn and network in the cashew business world. It also allows stakeholders to promote their brand, products, and services.”

Lack of cashew processing leads to huge losses for Tanzania

A recent study by the Agricultural Non State Actors Forum (Ansaf) has revealed that export of raw cashew nuts (RCN) instead of kernels led to heavy losses for Tanzania. The study has reported that in the 2020/21 season, Tanzania has lost Sh 216 billion.

Lack of cashew processing leads to huge losses for Tanzania

–  The Cashew production would have also created 63,058 jobs for the country which faced a major challenge of unemployment. The study pointed out that in the 2020-21 season, people traded raw cashew nut  at a maximum price of Sh2,707 per kilo; while kernels fetched a minimum price of Sh15,000 per kilogramme.

– According to the findings of the Ansaf report dubbed: Economic opportunities in cashew processing and the costs of exporting RCN; only 10 percent of RCN is getting processed despite the 50 percent processing capacity of the country. Many of the units do not function due to obsolete technology.

– The industry players also suffered from limited capital access, barriers from taxations and regulatory frameworks and inadequate market; which linkage with investors in major kernel importing countries according to the report.

– The study has recommended setting up of agro-processing centers to accommodate a number of small agro-processing chain actors; and strengthening of LGAs and Small Industries Development Organization (SIDO). It has also suggested linkages between farmers, contract farming  to link farmers and processors, partnerships and setting up of  supply chains for local processors.

– Besides, businesses also need to improve and update technology. Instead of just producing raw cashews for export, the export of processed cashews brings more benefits to farmers. Not only that, it is possible to expand the market for domestic and foreign investors with the latest technologies; thereby helping to optimize and efficient cashew nut production.

West Africa’s Cashew Industry Gets $60 Million in Processing Boost

A US backed project plans to help invest about $60 million in West Africa’s cashew nut industry as part of a goal to boost local processing.

A US backed project plans to help invest about $60 million

– The Prosper Cashew project, started by a non-profit organization will create a fund to strengthen of processing in Ivory Coast; Ghana and Nigeria. Launched in October 2020, the project aims to act as a catalyst for the cashew industry, strengthening and reviving existing processing facilities.

– While West Africa is the biggest cashew producer, people only processed locally about 10%. Ivory Coast and the Prosper Cashew project are trying to encourage people process more cashew in Africa. The project also says private-sector interest in sourcing from the region is growing’ as buyers look to diversify their sourcing footprint and reduce supply risk. 

– At least $30 million of the planned investment will come from funds raised by the Prosper Cashew project. Most of the money will be invested in Ivory Coast, where processing will benefit the most.

– Over the next five years, TechnoServe said Prosper Cashew would improve the capacity of 60 processors who source cashews from approximately 34,000 farmers, facilitate $497 million of investment in the cashew sector, and generate $1.5 billion in cashew kernel sales.

Ivory Coast announces 20 million USD aid plan

Ivory Coast plans to commit more than $20 million to helping cashew processors struggling against competition from Asia. Besides, it also helps to boost the percentage of the crop in the country..

– The world’s largest cocoa producer – Ivory Coast, has also in recent years become the top grower of cashew nuts; with an annual production of around 1 million tonnes. It processes only about 10% of that and exports the rest raw.

– The government hopes the aid plan combined will help boost processing to 50% of national production by 2025 or 2026; which would allow Ivory Coast to compete with the world’s biggest processor, Vietnam.

– Ivory Coast processes about 2.6% of cashews produced worldwide, behind Vietnam at 52.8%. Ivorian processors last year said they needed more help to compete with Asian companies.

– The plan is still under discussion but is 90% finalized and will be announced in the near future. It will increase the subsidy given to national processing companies, though it was not clear by how much, and help them secure bank financing through the establishment of a guarantee fund worth more than $20 million.

Cashew output in Nigerias seen rising 20% on good weather

Nigeria is the fourth-largest producer of cashew nuts in Africa and sixth globally, with 160,000 metric tons per annum, according to data from the country’s agriculture ministry. This is a very potential country in the production of cashew nuts. Under good weather conditions, cashew output is expected to increase.

Cashew on favorable weather conditions

– People expected Nigeria’s cashew output to rise 20 percent on favorable weather conditions, which have helped boost output for the 2021/22 season to an estimated 192,000 tons, the national president of the National Cashew Association of Nigeria, has said.

– Despite the COVID-19 omicron variant uncertainty, accelerating inflation, increasing shipping and logistic cost, People still demand for Nigeria’s cashew crop on the back of cashew being an immunity-boosting food.

– Cashew farmers in Africa’s most populous expect prices to hit an average of N500,000 per metric ton on the decline in Indian production and surging demand from Vietnam and Asia. People  harvested between February and June, though farmers stock the crop and export it all year round.

– According to data from the National Bureau of Statistics (NBS), Nigeria earned N42.9 billion from cashew nuts export in the first nine months of 2021. People exported bulk of Nigeria’s cashew nuts and kernels to Asia, Europe, and the United States.

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