Monday, January 24

Global demand for cashews is booming

the global cashew industry It has grown rapidly over the past decade, driven by increasing cashew consumption around the world. And the raw cashew market is forecast it will continue to grow at an annual rate of 4.27% between 2020 and 2025. It is expected to reach almost US $ 7 billion by 2025.

The growing demand for cashews around the world, particularly in developed and emerging economies, is driven by a number of factors. They include recognition of your nutritional and health benefits and growth on plant-based diets. Cashews are also considered a substitute for dairy products and represent a popular salty sandwich. They are also a substitute for the ever popular peanut butter.


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African countries are at the forefront to respond to this growing demand. They have increased production.

Proving this, the African continent now represents more than 50% of the raw cashew. About 90% of all African production is exported, mainly to Vietnam and India. These two countries account for 98% of world imports of raw cashews. Cashew nuts are shelled and processed by Vietnam and India before re-exporting them to the US, Europe, the Middle East, China and Australia, where they are in turn roasted, salted and packaged before consumption.

Low cashew processing rates in African cashew producing nations are due to several factors. These include limited infrastructure and local processors. But several African governments have recently implemented policies and measures to address these shortcomings. However, there are still gaps. Research is needed to better understand the structural challenges limiting local processors.

Ghana is among the top African cashew producers. Ghana currently produces around 85,000 metric tons of raw cashew nuts each year, which represents about one percent of the world’s total production. Of this, more than 90% is exported to India and Vietnam by Asian exporters and processors.

Cashew nut production in Ghana dates back to 1960, with production for export markets that expanded significantly in the last decade.

Our investigate focused on the Brong Ahafo region, now Bono East, Bono and the Ahafo regions. Here we seek to better understand the dynamics and issues associated with Ghana’s growing cashew sector, including the particular challenges faced by local processors.

Local processors face many challenges

Ghana has 14 cashew processing plants, with a total annual capacity of 65,000 metric tons of raw cashews. Although 10 of these plants are active, they process less than 10% of the total annual cashew production. The remaining processing plants have either stopped operating or have been completely closed.

There are a number of challenges that hamper local cashew processing in Ghana. One of the keys is the lack of capital to sustain operations, coupled with the inability of local processors to access raw cashew nuts from farmers, exacerbated by poor transportation infrastructure. Although local processors can access loans and credit facilities from commercial banks, high interest rates make this an unfeasible option, especially for small national operators.

The shortage of capital also limits the ability of local processors to buy raw cashew nuts from farmers. Local processors also face intense competition from foreign processors and exporters, especially from Asia, which drive up cashew prices. While Asian processors and exporters can afford high producer prices due to their access to Interest rates In their home countries, local processors cannot compete, leaving them simply unable to buy raw cashews.

Cashew farmers also demonstrate a preference for selling their nuts to Asian processors and exporters, who pay them immediately in cash. Local processors, on the other hand, often buy cashew nuts on credit.

These conditions leave Ghana out of the field, thus losing important employment and income-generating opportunities through the burgeoning global cashew industry. Recent estimates indicate this loss at approximately $ 100 million every year. This loss is mainly related to Ghana’s inability to process and therefore add value to its raw cashews.

The way forward: Ghana should learn from other countries

Governments of major cashew producing countries in Africa are increasingly implementing strategies to increase both the production and processing of raw cashew nuts. For example, in Côte d’Ivoire, the world’s largest exporter of raw cashew nuts, a export tax of FCFA 30 per kg raw cashew nuts has been introduced recently. The proceeds from this tax are used to subsidize and support local processors. This has encouraged local processing, making Côte d’Ivoire, Ghana’s neighbor, Africa’s largest cashew processor, with a capacity of 70,000 metric tons per year.

Similarly, Mozambique and Tanzania have adopted a series of measures protect and incentivize local cashew processors. These include granting local processors preferential access to raw cashews. It also includes the imposition of export duties on raw cashews. Meanwhile, since 2009 Kenya has introduced a ban on the export of raw cashews, a strategy that has increased local processing since 30% in 2009 to 80%in 2012.

The Ghana Export Promotion Authority is currently working with the Ghana Cashew Industry Association to increase local processing. This collaboration can benefit from the experiences of other African countries, including to guide a national cashew processing strategy.

Importantly, local processors must be protected against Asian competitors coming to Ghana to buy cashew nuts during the cashew harvest season. They also need tax incentives, affordable credit facilities, and modern technology to thrive.

With the right support, Ghana could take advantage of the growing demand and consumption of cashews in developed and emerging economies, with results that will generate jobs and income.The conversation

James boafo, Professor of Geography and Sustainable Development, Kwame Nkrumah University of Science and Technology (KNUST) and Kristen lyons, Professor of Sociology of Environment and Development, The University of Queensland

This article is republished from The conversation under a Creative Commons license. Read the Original article.

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