Cashew – a prized commodity, an answer to poverty, and the world’s favourite nut!

by | Nov 12, 2019

I have to admit, I love cashew. So I was delighted to have the opportunity to address the Africa Cashew Alliance’s 13th annual conference held in Dar es Salaam on a bright morning in early November. I was even happier to see that every single speaker that I shared the dais with, representing leadership of the cashew fraternity and including the Honorable Japhet Hasunga, Tanzanian Minister of Agriculture, touched on the burning issue of increasing Africa’s cashew processing capacity to match its status as the world’s largest producer of raw cashew nut. Angelina Ngalula, from the Tanzania Private Sector Foundation, encompassed the issue perfectly in one question she posed the audience: “Why do we continue to export raw cashew and why do we continue to export employment?”

There is no better place or time to be having these conversations, as we are all aware of the unique position of Tanzania today in the global cashew economy. We have witnessed dramatic leaps in local cashew production each year – a radical 450% in the last 15 years. It is currently the world’s third largest producer of raw cashew nuts, with a projected harvest of over 300,000 metric tonnes by the end of the 2019 season. As we speak, farmers everywhere are collecting the fallen cashew apples, and gathering under the shade of magnificent evergreen cashew trees with their families and neighbours to pluck the precious nuts. And yet, currently, only 10% of Tanzania’s raw cashew nut is being processed locally.

Tanzanian cashew is an increasingly treasured commodity the world over for its premium size, colour and taste, and is regarded as one of the best quality origins in the world. Furthermore, it has the competitive advantage of having its harvests in the off-seasons of the other cashew producing giants, India and West Africa, therefore garnering higher market rates. Internationally, demand for cashew kernels is also on the rise, in large part a result of expanding health consciousness and the marketing of cashew as a versatile “super food.”

Incidentally, the Portuguese word for cashew, acaju, derives from a Tupian word that literally translates to the “nut that produces itself.” This nut that produces itself has quietly taken centre stage as one of Tanzania’s top export crops, and seamlessly given birth to a burgeoning industry ripe with the promise of prosperity and a large-scale socio-economic footprint. It is no strange coincidence that the first syllable of CASHEW is, well, CASH!

In addition to this, the cashew value chain holds within it the critical capacity to create auxiliary industry through the deployment of by-products. Cashew nut meal, and cashew nut oil cake, is used to feed livestock. Cashew apples can be eaten fresh, pressed into juices, or made into jams – I saw these products on display at the ACA’s exhibition this year. Cashew nut shells are one of the most abundant forms of tropical biomass waste that can be used as bio-fuel. Cashew Nut Shell Liquid is used in the manufacture of resins, varnishes, and many high-tech materials that can withstand high temperatures, such as brake linings. CNSL is also used as a pesticide against termites in timber, and the bark gum is repellent to insects. There are few other agricultural products in the world which contain within them such vast possibilities to be utilised in the food, medicine, chemical and allied industries.

Most significantly, however, the biggest unexploited potential lies in intensifying local cashew processing. Value chain addition is mainly achieved through processing and packaging activities, and many African governments have understood that agro-processing industries play a crucial role in achieving sustainable economic development by diversifying the economy, capturing an increased part of the added value, and creating employment opportunities for the population – especially women. Removing the shell and skin without breaking or contaminating the kernel is difficult and has been most successfully done manually by skilled workers.  If an average worker in Tanzania shelled between 20-25 kilograms of raw nuts a day and worked 250 days a year, approximately 50,000 workers would be needed to shell the projected 300,000 tonnes of raw cashew nuts that Tanzania produces in 2020 through toll processing facilities. Thus the employment opportunities from manual processing are significant, which will lead to increased productivity, a better quality of life and ultimately, a higher GDP.

We are all aware that developing a competitive private sector processing industry, that includes microsatellite cashew processing units, would also reduce dependence on external buyers as the market for raw nuts. These growth opportunities are only possible with wholehearted public sector support through enabling regulatory mechanisms. Firstly, this would involve exemptions on duties and taxes connected with the import of machinery and spare parts, as well as packaging material. Secondly, VAT exemptions must be considered on the purchase of local packaging material and third party processing. Third, cashew processing factories, which are mainly operated in extreme locations where there is lack of water, electricity and other basic facilities, should be granted the special status of SEZs. And finally, processors should be given preference over exporters in the form of rebates or discounts on the purchase of raw cashew nuts, and financial incentives to hold stocks and recover losses as happens in West African countries.

Through a collaborative approach framed within a public private partnership, I am convinced that Tanzania can raise its processing to 50% in the next 10 years. ETG, as an assured buyer and processor of raw cashew nut, is always ready and willing to contribute to this long-term mission in any way it can. With our continued focus on the smallholder farmer and their empowerment through linkages with global and commercial value chains, participation in a blossoming cashew industry in Tanzania and regionally, strongly resonates with us.

The word CASHEW sounds like KESHO, the Kiswahili word for ‘tomorrow’. I have no doubt that cashew is the crop of the future for Tanzania and other African countries!

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