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Tanzania: Going nuts over cashew

Tanzania: Going nuts over cashew

Attempts at revival
But while 90% of Tanzania’s cashew crop is harvested in the country, less than 10% is processed locally. The majority of processing takes place in India, Vietnam and Brazil, and the revenue lost as a result of exporting unprocessed nuts is a core issue that the government is trying to address.

At the inaugural Cashew Investors Conference in Dar es Salaam in 2013, Tanzania’s then Deputy Permanent Secretary in the Ministry of Industry and Trade, Maria Bilia, said that without value addition, it would be impossible to achieve a balanced trade in Tanzania.

“We have witnessed, and we continue to witness from our business partner countries, [that] we export our raw material [and they] benefit from the finished cashew product. Now it is our time to turn the sector and benefit our country,” she said.

In other words, while Tanzania’s export of cashews benefited the buyers who paid low prices for the product in its raw state, Tanzania was seeing nothing of the profits.

The African Cashew Alliance estimated, in a 2014 report, that in the past five years Tanzania has lost $551m in value addition by exporting in-shell cashew nuts instead of processing them. Government attempts to dissuade export of the unprocessed commodity by hiking the export tax from 10% to 15% in 2011 has, however, had limited effectiveness, according to the FAO.

Before privatisation, Tanzania had 12 cashew nut processing factories which, in the 1990s, were sold to private firms. Currently there are three that process the crop: Olam Tanzania Ltd (Mtwara), Korosho Africa (Tunduma, Newala and Mtwara) and Mohammed Enterprises (Dar es Salaam), and they cannot absorb the entire national production. Most farmers therefore use manually operated machines.

Prime Minister Pinda

In July, Tanzania’s Prime Minister Mizengo Pinda announced the government would revive four cashew nut processing plants in the southern regions at an investment of $72m. Plants lined up for rehabilitation are Newala­1, Masasi, Lindi and Nachingwea, which will subsequently process a cumulative total of 29,500 tonnes of cashew.

The CBT is also planning to construct three new processing plants in the southern regions under a public-private partnership model to cut the losses the country incurs in exporting raw nuts.

The increased attention being paid to the sector has seen a threefold increase in national production from 35,000mt in 2006 to 114,600mt in 2012, and 2013/14 figures are expected to shoot up due to abundant rains in the southern regions.

Anticipation over the sector’s revival has also seen the regions of Singida, Dodoma and Morogoro in the central provinces express an interest in joining the ranks of cashew growers.

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Written by Aamera Jiwaji

Aamera Jiwaji is a Nairobi-based business journalist who writes for the East African and MENA markets. A graduate of South Africa's Rhodes University, she returned to the media in 2011 after working in Kenya's publishing and public relations scene. Tweet her on @amijiwaji.

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