REPOSITIONING AFRICA CASHEW TRADING FOR THE LOCAL PROCESSING INDUSTRY

The cashew nut is one of the most widely traded commodities in the world, with a market value of over $5 billion. Cashew nuts are one of Africa’s most important cash crops, accounting for a significant percentage of the continent’s agricultural exports. The global demand for cashews has been on the rise, and this trend is expected to continue in the coming years. Nigeria, in particular, is one of the world’s largest cashew-producing countries, and the industry has the potential to contribute significantly to the country’s economic growth. However, despite its potential, the industry has largely remained underdeveloped, with the majority of the cashew nuts being exported in their raw form. This article will analyse the cashew trading industry, explore its positive impact on the local processing industry, examine the current state of the cashew trading industry in Africa, and the steps being taken to reposition the industry for local processing.

OVERVIEW OF THE CASHEW TRADING INDUSTRY
The cashew nut is primarily grown in tropical regions such as Africa, India, and Vietnam. These countries account for the majority of global cashew production. The nuts are harvested by hand and then processed to remove the outer shell, which is then roasted and salted for consumption.
The cashew trading industry is highly competitive, with many countries vying for a global market share. The United States, Europe, and Asia are the largest importers of cashews, with the United States being the largest consumer of cashew nuts. In recent years, Vietnam has emerged as the largest exporter of cashew nuts, followed by India and Brazil.

CURRENT STATE OF THE CASHEW TRADING INDUSTRY IN AFRICA
The African continent produces around 40% of the world’s cashew nuts, making it a significant player in the global cashew trade. However, despite its high level of production, Africa has largely remained a net exporter of raw cashew nuts, with little value addition taking place on the continent. Most of the cashews produced in Africa are shipped to Asia for processing, where they are roasted and packaged for export.
The lack of local processing has significantly hindered the development of the cashew industry in Africa, as it has limited the industry’s potential for creating jobs and generating revenue for the local economy. In addition, the export of raw cashew nuts has exposed African countries to price volatility, with prices often dropping during the off-season.

REPOSITIONING FOR LOCAL PROCESSING
The African cashew industry has recognised the need to reposition itself for local processing, with several countries taking steps to develop their processing capabilities. Nigeria, in particular, has been making significant strides in this regard.
Nigeria is currently the largest cashew producer in Africa, accounting for over 20% of global cashew production. However, despite its high level of production, the country has largely remained a net exporter of raw cashew nuts. In recent years, however, there has been a push to develop local processing capabilities, with the government setting a target of processing 50% of the country’s cashew nuts locally by 2023.
To achieve this goal, the Nigerian government has been providing incentives to investors to establish cashew processing factories in the country. The government has also been investing in research and development to improve the quality of locally processed cashews and to develop new cashew-based products. The country has also been collaborating with international organisations such as the African Cashew Alliance and the International Trade Centre to develop the local cashew processing industry.
Other African countries, such as Ghana and Ivory Coast have also been making efforts to develop their cashew processing industries. For instance, Ghana has been incentivising investors to establish cashew processing factories, while Ivory Coast has launched a cashew processing program that aims to create 150,000 jobs by 2020.

POSITIVE IMPACT ON THE LOCAL PROCESSING INDUSTRY
The global demand for cashews has led to the establishment of many cashew processing factories in cashew-producing countries. These factories create jobs for the local population and provide a boost to the local economy. In addition, the processing of cashews has added value to the product, making it more profitable for farmers and other stakeholders in the industry.
In India, the cashew processing industry is a significant contributor to the country’s economy, providing employment to over 1 million people. The country exports over 200,000 tons of cashews annually, making it the second-largest exporter after Vietnam. The Indian cashew processing industry is highly organised, with many factories adhering to international quality standards.
In countries such as Nigeria, Ghana, and Ivory Coast, cashew processing factories have been established to create jobs for thousands of people. In Africa, cashew processing has also become a significant source of employment and income for many people. In Ivory Coast, for instance, the government has launched a cashew processing program that aims to create 150,000 jobs by 2020, but the African government and the private sector have to do more to attract the necessary investment to the industry.
In Vietnam, the cashew processing industry has grown rapidly in recent years, with the country now accounting for over 50% of global cashew exports. The industry has created jobs for thousands of people and has helped to boost the country’s economy.

CONCLUSION
The cashew trading industry is an important part of the global economy, with many countries benefiting from the production and trade of cashew nuts. The African cashew industry has the potential to contribute significantly to the continent’s economic growth, but this potential can only be realised through the development of local processing capabilities. Nigeria, as the largest cashew producer in Africa, has been taking significant steps to reposition itself for local processing, with the government providing incentives to investors and investing in research and development. Other African countries, such as Ghana and Ivory Coast, have also been making efforts to develop their cashew processing industries. The development of the local cashew processing industry and industry’s growth has led to the establishment of many cashew-processing factories, creating jobs and income for people in cashew-producing countries, generating revenue for the local economy, and reducing the exposure of African countries to price volatility in the global cashew market. The positive impact of the cashew trading industry on the local processing industry is evident, with many countries investing in the establishment of cashew processing factories. As the global demand for cashews continues to grow, we can expect the cashew trading industry to contribute to the global economy significantly.

Author: AITRC 2