FG urged to shift focus to cashew processing to boost export, output

… industry needs cheap credit to expand – NCAN

Nigerian cashew growers have urged the federal government to shift its focus to cashew processing to boost export earnings and output while creating jobs for its fast-growing population.

The farmers under the National Cashew Association of Nigeria (NCAN) who spoke at the third edition of the Nigeria Cashew Day – themed ‘Catalysing Sustainability in Nigeria Cashew Industry’ held recently in Lagos, said for every amount earned in the export of raw cashew, Nigeria would have made much more if it were processed before export.

They added that it will also help the country edge its farmers against price volatility as they will have a large market locally and for export.

Ojo Ajanaku, president of NCAN said the country is not maximising the potential of the cashew crop in terms of job creation and revenue generation owing to poor value addition.

Ajanaku noted that Nigeria had lost its place in the comity of cashew producing nations when it moved from first position on the continent to fourth position.

Nigeria is the fourth largest grower of cashew nuts in Africa and sixth globally, with production estimated at 350,000 metric tons per annum.

He said farmers are unable to boost production owing to a combination of issues owing to low processing, high interest rate and high cost of seedlings and aging trees among others.

“If we don’t encourage processing, there will be no full market for farmers to benefit. We are looking at a policy that will favour processing in the country and encourage farmers to grow more cashew,” he said.

“Processing is highly capital intensive. Cashew harvest lasts for just three months yearly and processors will have to buy and stock what they need for processing all through the year and this is highly capital intensive,” he explained.

“The cost of capital is highly intensive as we are looking at 42 percent which you cannot break even with,” he added.

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He commended the government for creating the domestic export warehouses to lessen the burden of interest on processors, however, he noted that a special product paper for cashew is needed to provide a single digit interest rate for processors to stock up all through the year.

He noted that the industry currently processes less than 10 percent of its cashew nuts.

Jumoke Oduwole, minister of Industry, Trade and Investment, said cashew, over the years, has remained one of the country’s major contributors to GDP, noting that it currently ranked third after cocoa and sesame in terms of export value.

Oduwole, who was represented by Akeredolu Johnson, said the ministry is working with the country’s cashew association to create a sector that delivers globally competitive value-added products.

She said the ministry has taken into account the need to create the right environment and platforms to spur investment across the cashew value chain, create market linkages and provide technical support to strengthen domestic production and processing.

The minister noted that a worrying trend in the sector is the inability to add value and export a high volume of processed cashew kernel.

“We are not unaware of the numerous challenges we have been confronted with which borders on the high cost of processing as well as limited availability of credit for processors to support their capability to procure high volumes of raw cashew nuts to enable processing at optimal capacity,” she said.

“This and more are many factors militating against our domestic processing efforts.” “Even though the challenges are enormous, we must continue to brainstorm until we find a solution on the way forward.”

Also, Babajide Sanwo-Olu, governor of Lagos, said the industry has the potential to generate over $3.7 billion annually into the Nigerian economy, noting that it is imperative to develop policies specifically tailored to the cashew industry.

According to him, these policies should promote the holistic development of the value chain, with a special focus on increasing production and significantly processing cashew into finished products within Nigeria.

The governor who was represented by Rotimi Fashola, special adviser on agriculture to the governor, said cashew farmers in the country are missing out on potential earnings owing to low-value addition.

“It is worth noting that countries growing cashew but not processing them on a significant scale retain only an insignificant fraction of the value created as the nut travels from farm to store.”