Private sector spurs cashew trade

THE global value of cashew nuts industry is currently valued at 2.6 billion US dollars having dropped slightly from 2.7 billion US dollar in the year 2020.

And for the record, more than 2.8 million tonnes of cashew were traded around the world.

Cote d’Ivoire, Cambodia and Ghana emerged as the leading exporters of the crop last year whereas India, Vietnam and United Arab Emirates were the top importers.

Production Tanzania is one of Africa’s leading producers of cashew nuts an emerging industry whose exports brings in more than 10 per cent of country’s foreign exchange.

According to Tanzania Cashew Board Tanzania produced 189,113 tonnes of cashew during the last season valued at 347bn/-.

Major producing regions of raw cashew nuts in Tanzania are Mtwara, Lindi, Coastal Region, Ruvuma, Tanga and Dar es Salaam in the descending order.

Cashew nuts board of Tanzania though reports that 2019 production have declined to 232,681.8 metric tonnes – which is 10 per cent of world’s total cashew output.

Four years ago, the Food and Agriculture Organisation of the United Nations, FAO, ranked Tanzania as eighth in the world and fourth in Africa – behind Nigeria, Cote d’Ivoire and Guinea Bissau – in cashew production.

It’s unclear whether same status exists this time around.

While India and Vietnam seem to go neck-and neck in competing for global supply, when it comes to Tanzania India seems to get the lion share of exports as it imported more than 61 per cent of all cashews that were exported by the East African nation.

Little is known behind this state of the matter but the relatively higher price that India offers plus strong trade connections between the friendly countries that has existed for decades appears to be the major reasons behind this trade flow.

In the past nine years, India has been our leading export destination by taking in an average of 66 per cent of Tanzania’s export share.

In the year 2019, though, for the first time in many years, India was outclassed by Vietnam by being the major importer of the permanent crop by fetching cashews to the tune of 197 million dollars which was 89 per cent of Tanzania’s exports.

Despite that shocking turn of events, according to International Trade Centre, Vietnam paid a relatively low price per tonne – 1,426 dollars – compared to India’s (US$1,492), Kenya’s ($6,237), Rwanda ($1,625) as well as Norway ($10,000).

Seasonality Tanzania harvests its nuts during the October – January period, which benefits it so much as its competitors from West Africa normally harvests in February or latter.

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Export pattern shows that after harvest begins in October, exports start in November and reach its peak in January before declining in the subsequent months.

Trading For many years now, cashew trade in Tanzania has been conducted through auction system of which Tanzania Mercantile Exchange in collaboration with Warehouse Receipt and Regulation Board (WRRB) and Tanzania Cooperative Development Commission (TCDC) have been taking a good care of an entire process.

Experience shows that the industry has been progressing so well when private sector leads the process and crumbles when government unnecessarily “intervenes”, the 2018 cashew debacle is a case in point which literary no sensible player would want to see its repetition.

Global prices have been fluctuating, thanks to the sector’s dynamic nature but it has been averaging at 1,100.8 US dollars per ton on the lower side and 1127.8 US dollars per ton on the higher side, CIF India Vietnam.

Even as we end today’s discussion it is important to take note of the increasingly raw cashew nuts exports.

There is very little of which Tanzania exports as processed nuts, probably this needs a very informed conversation as to why the situation stands for ages now.