Africa: Lack of processors affecting cashew exports and inhibiting growth

Vietnamese cashew

With over $182 million realised from the export of raw cashew nut and the industry creating about 600, 000 jobs in the country, the lack of processing facilities is hampering cashew exports and inhibiting the growth of the sector.

According to the Managing Director, Vertex Agro Limited, Daniel Gemana, in an article published on, Nigeria can generate more revenue and create more employment opportunities for its teaming young population if the raw cashew nuts were to be processed locally.

Please the full interview…
The cashew industry is one of the most promising sub-sectors in agriculture. But Africa that grows most of the world’s raw cashews is missing out on a wealth of opportunities offered by the booming global demand. Analysts attribute this to low level of processing. DANIEL ESSIET reports.

THE global market for cashew is booming, according to United Nations Centre for Trade and Development (UNCTAD). The African Cashew Alliance (ACA) estimated raw cashew nuts (RCN) production in Africa to be at around 2.1 million metric tonnes, representing about 57 per cent of global production.

However, one major challenge facing the industry is low level of processing. Because of poor processing capacities, most raw cashew nuts are exported to Vietnam and India, the two countries which account for 98 per cent of the world’s raw cashew nut imports.

In Vietnam and India, the raw nut is deshelled and processed into cashews before re-exporting them to the United States, Europe, the Middle East, China and Australia, where they are, in turn, roasted, salted and packaged prior to consumption.

READ: News: West African Cashews Draw Vietnamese Buyer to Challenge Olam

According to UNCTAD’s report, published April last year, the product has the potential for increased income and could reduce poverty for Africa’s three million small cashew producers. According to UNCTAD, the problem lies in the lack of local processing industries. Cashew nuts grow in Côte d’Ivoire, Tanzania, Nigeria, Benin, Burkina Faso, Guinea-Bissau, Mozambique and Ghana.

For this reason, the governments of these key cashew producing countries are rolling out strategies to increase the production and processing of the nuts.

An example is Cote d’Ivoire, the largest exporter of raw cashew nuts in the world. The government imposed an export tax of CFA franc 30 per kg of raw cashew nuts to raise revenue to support processors. Analysts say the outcome has incentivised local processing, boosting production capacity to 70,000 metric tonnes yearly.

Also, the Ivoirien Government is committing more than $20 million to helping cashew processors struggling against competition from Asia and to boost the percentage of the crop that gets processed in the country.

The government hopes, in partnership with the private sector, to boost processing to 50 per cent of national production by 2025 or 2026, which would allow Cote d’Ivoire to compete with Vietnam, according to analysts.

Though there are no reliable figures to show Nigeria’s yearly capacity for cashews processing, cashew remains an integral part of industrial and export crops, supporting over 300,000 families and sustaining 600,000 jobs.

Analysts said cashew industry earns about N150 million, and raw cashew exports provide $182.5 million.

If the raw cashew nuts were to be processed locally, the Managing Director, Vertex Agro Limited, Daniel Gemana, noted, Nigeria could generate more revenue, create more employment opportunities – and benefit more in related activities, including value addition. He set up a cashew nut processing plant in Gauraka,Tafa Local Government Area of Niger State for processing and exporting cashew and sesame seeds to markets in Brazil and Dubai.

He explained that there were some challenges that hinder local processing of cashew nuts. Key among them is a lack of capital to acquire machines and the inability of local processors to access raw cashew nuts from farmers.

Gemana stressed the need for the government to put in place an enabling environment to support increasing investment in domestic processing of cashews.

According to him, if the government is to make true its promise of locally processing the cashews produced in the country, it will, ultimately, benefit the economy. He said it would snowball into significant employment not only through the processing, but also in the extraction of by-products from the raw nuts, to be used in the production of chocolates, jams and other delicacies, as well as fertiliser from the same raw material.

At the moment, what the stakeholders are clamouring for is protection against Asian competitors who visit the farms to buy cashew nuts during harvest. The other prayers were for the government to facilitate the granting of loans for use on cashew processing plants and supplies of water and power as a matter of urgency.

He explained that a lot of them were processing cashews below the installed capacity because supplies of power to the industries were epileptic.

He stressed that the government needs to provide support to promote the cashew industry.

According to him, investors would be lured to set processing factories if there were incentives provided by the governments.

So far, he noted, multinationals are coming into cashew processing. Already, Olam Agro has established a cashew nut processing and exporting company in Tanzania, Mozambique, Cote d’Ivoire and Nigeria. Similarly, construction giant, Julius Berger, has launched into cashew processing. It has a state-of-the-art cashew processing plant in Epe, Lagos.

With big players coming into the industry, Gemana told The Nation they had put in motion a plan to establish a cashew processors association to enable those of them into processing to get the government’s ears to address encumbrances hampering the growth of the industry.

While processing remains a major challenge, the President, National Cashew Association of Nigeria (NCAN),Chief Ojo Ajanaku, said the association had been working hard to change this. The target is to process most of the industry ‘s output in the approaching years.

Apart from encouraging more Nigerians to get involved in cashew farming, Ajanaku noted that critical attention was being given to increasing the quantity of raw cashew nuts to enable processors get enough supplies.



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