WATH West Africa Trade Hub News African
cashew prospects: The quest for better quality and wealth creation
Posted on: 30-Apr-2007 found at myjoyonline.com
Africa
currently produces more than one-third of the world’s cashew (605,000 tons out
of 1.6 million tons world wide in 2006) and exports an estimated 95% of raw nuts
abroad.
Cote d’Ivoire, Guinea-Bissau and Tanzania rank 4th, 5th & 6th respectfully
on the league of biggest producers in the global market, urging out a country
like Mozambique which was the then leading producer of cashew on the continent
in the 1970s.
But despite the apparent good standing of the continent’s exports, majority of
the farmers continue to struggle to make the needed economic impact, forcing
them to either fold up completely or shift their attention to the cultivation of
new set of crops.
From a low level of local consumption to the absence of credit facility from the
banks and other donor agencies, farmers continue to struggle to stay in business
despite the odds.
A case in hand is Guinea-Bissau where a lack of financing for raw material
purchases and lack of buyers of kernels are some of the problems facing the
industry. Besides, there is no national export brand and no credible quality
certification, which means the country’s kernels lack recognition in the
international market.
Surprisingly, this problem is equally prevalent in most of the cashew growing
countries like Ghana, Senegal and even Cote d’Ivoire which is seen as one of
the big-shots in the industry.
The industry recently formed a continental cashew association to promote a
campaign to add value to its nuts, encourage higher production and better
quality, and market Africa as a source of quality organic cashews. The African
Cashew Alliance is a private-public partnership that aims at promoting the
African cashew sector from production to consumption.
It also serves as a platform that brings together cashew stakeholders to share
common vision and capitalise on the sector’s potential for economic growth and
employment.
The African cashew industry employs three million households, but is dogged by
depressed prices and dwindling production.
The West African Trade Hub (WATH) an agency that is helping to revamp the cashew
industry in Africa says for many years African raw cashews have been exported to
India and Vietnam where they are processed and the majority is shipped to Europe
and to the USA for consumption.
According to the agency, East Africa alone processes more than 20% of its
domestic production. West Africa is increasing the number of its processing
plants and will expand its current processing capacity of 3% to higher levels in
the coming years.
But industry officials say whereas world cashew production has increased,
Africa's share has decreased over the years. The continent's current output of
300,000 tonnes is less than half its potential of 700,000 tonnes.
The Alliance therefore hopes to address this very situation by liaising with
local associations in the 14 member countries, by linking actors of the industry
across countries to share information and create a common vision and synergies.
Again, the association equally hopes to prioritise and stimulate interventions
to increase competitiveness, as well as facilitate fund raising efforts for
cashew industry development initiatives and projects in the sector.
At its recently held meeting in Guinea Bissau, delegates discussed the pertinent
issue of appropriate forms of drying the nuts in order to make them attractive
to the international markets.
“Exporters and international buyers are stressing proper drying, the need to
let the cashews mature before harvesting, and the need to package raw nuts in
jute bags instead of the poly-plastic bags,” participants stressed.
According to officials of TechnoServe, an agency that advocates a better pricing
for cashew farmers in Mozambique, cashew processing in Africa could generate
annual revenues as high as $500 million by 2015, of which 40 per cent would go
to wages for manual labour.
The primary target markets for Africa, which produces a third of the world's
cashews, are the European Union and Asia. The Executive Director of the Agency
Jake Walter said "African processors need to be competitive in four areas:
broken nut yields, production costs, working capital rates, quality and
reputation."
He added that "processors must also have access to quality nuts to assure
long-term industry viability."
Statistics from every one of Africa's big producers paint a bleak picture as far
as processing is concerned. Guinea-Bissau, the second biggest producer in Africa
and the fifth in the world, produces 90,000 tons, according to Fernando Flamengo,
a cashew nut processor.
Mr. Flamengo says almost all the production is exported for processing in India.
He notes that, directly or indirectly, almost 80 per cent of the country's
population is connected to the cashew industry.
The Ghanaian industry is dogged by low inputs, low yields and poor prices for
raw nuts. Orleans Chinery, the cashew project manager for TechnoServe Ghana,
says virtually all nuts are exported raw. He adds, however, that a large
increase in processing over the next five years is expected to occur with the
establishment of five new processing plants.
Meanwhile, Ivory Coast has one struggling processing facility and virtually all
its produce is exported in raw form to India, accounting for 22 per cent of all
India’s cashew nut imports. The country, whose production in 2003 was 64,000
tonnes, has 20 export companies, and 1.5 million people involved in cashews.
TechnoServe, which is operational in most of Africa's major cashew growing
nations, says the lack of viable processing industries means that African
countries are forgoing tremendous value-added gains. It says the price for
cashew kernels has of late averaged $4,500 per tonne, compared with $500-$700
per tonne for raw cashew nuts.
Source: dailyEXPRESS/Nii Kwaku Osabutey ANNY with files from New Agriculturist
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