Africa currently exports an estimated 95 per cent of its cashew nuts in raw form, but this could change following moves to boost processing on the continent and to raise the profitability of the ailing industry. The African cashew industry employs three million households, but is dogged by depressed prices and dwindling production.
Besides Mozambique and Tanzania, other notable African producers are Ghana, Guinea Bissau, Kenya, Madagascar, Benin, Togo and Nigeria. 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 tonnes, with almost all the production exported for processing in India. Directly or indirectly, almost 80 per cent of the country's population is connected to the cashew industry.
Lack of financing for raw material purchases, as well as 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 Guinea-Bissau kernels lack recognition in the international market.
The Ghanaian industry is dogged by low inputs, low yields and poor prices for raw nuts. A large increase in processing over the next five years is expected to occur with the establishment of five new processing plants.
Tanzania, whose 2004 production is expected to be 84,000 tonnes, processes only about 10 per cent of its production, while the rest is exported to India for processing. A small amount of processed kernel is exported to the US, Europe and South Africa. The sector employs 280,000 smallholder farmers. Tanzania's cashew industry generates 5 per cent of the country's export earnings - approximately $70 million annually - from raw cashew nut exports. Following nationalisation of the cashew sector in the 1970s and investment in costly, large-scale production plants utilising inefficient technology in the 1980s, the industry has experienced troubled times. Raw cashew nut production in Tanzania has fallen from 128,000 tonnes in 2001 to 84,000 tonnes currently. Analysts say a viable processing industry in the country could create 30,000 direct jobs and generate $40 million in incremental processing revenues annually.
Cashew industry officials in Tanzania say high levels of taxation at the farmgate and on processed cashews, low farmer profitability leading to lack of investment in the crop, limited processing experience and lack of an established international reputation for Tanzanian processed kernels are the main problems.
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.
African production has been constrained by low tree yields, pests, lack of by-product usage, inadequate farmer training and lack of funding. Limited access to credit, abandonment of trees and marketing constraints are the other obstacles. Most of Africa's major cashew growing nations lack viable processing industries, meaning that African countries are forgoing tremendous value-added gains. The price for cashew kernels has of late averaged $4,500 per tonne, compared with $500-$700 per tonne for raw cashew nuts. Besides, with processing, thousands of jobs would be created in Africa.
