Africa accounts for 53% of global cashew production, but less than 10% of global processing. Through local processing there is a value addition potential of US$2.8 billion every year and potential employment of 275,000 people in the processing plants.
USIBRAS Ghana Limited, subsidiary of a leading cashew nut processing firm with four units in Brazil, Africa and USA, is the largest cashew processing plant in the country.
The Managing Director of USIBRAS, Patricio Lima Assis, is calling for a comprehensive and industry-specific policies to help revive the ailing cashew processing sector in the country.
Patricio Lima Assis believes government should protect cashew processing companies in the country against competitors in highly subsidized economies like India and Vietnam, by offering incentives such as tax reliefs, affordable agro-processing credit facilities, and support to acquire state-of-the-art industrial equipment, as well as, discourage excessive export of raw cashew nuts (RCN).
This is to avert the perennial fluctuating of the price of raw cashew nuts on the world market which goes to affect the labour costs and investment made by cashew producers who are often left at the mercy of middlemen who exploit their labour.
Currently, the price of cashew on the world market has collapsed as a result of COVID-19 and the 2020 cashew season opened with a price of GH¢7/kg. Within a matter of a month, the price took a nosedive to low as GH¢2.5/kg.
The price collapse and challenging economic environment has seen only two processors, out of 12, still in operation with the rest shutting down. Even among the two cashew factories in business, they operate below their optimal capacities.
With this state of affairs, it is little wonder that cashew producers are up-in-arms against the prevailing circumstances and want to see the revival of local processing capacity so that processors can purchase the needed raw cashew nuts and offer farmers competitive prices.
USIBRAS Ghana Limited has a processing capacity of 30,000 metric tonnes per year but its processing volume is around 15,000 to 20,000 mt. Assis has bemoaned the excessive exportation of cashew in its raw form, indicating that the trend denies the country the actual benefits of the commodity along its value chain.
The situation is starving processing companies as the sub-sector has the potential to create thousands of job opportunities. Currently, USIBRAS alone has a workforce of 600. Since Cashew is the leading Non-Traditional Export (NTE) commodity in the country, we need to protect the industry and its players.