Cashew farmers lose N99 bn in Q1 as drop in global price threatens Nigeria’s cashew exports

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The National Cashew Association of Nigeria Publicity Secretary, Mr. Sotonye Anga, has said the continuous crash of commodity prices in the global market has had a huge impact on the Nigerian cashew sector. Many exporters, he said, have been forced to hold excess stocks of raw cashew nuts bought at a time when prices were more favourable.

Anga told news men that cashew sells for below $1,000 per metric tonne (MT), signaling 34 per cent drop in price from last year.

Last year, the price of raw cashew nuts fell by 50 per cent from N600, 000 ($1,666) per metric tonne in April to about N300, 000 ($833) in July. In 2017, a metric tonne was bought at the rate of N600,000.

Since the commencement of the 2019 cashew season, exporters have been unable to meet up with their contractual agreements entered into on the back of a worsening Apapa and Tin Can traffic situation as well as the slow clearing process at the port.

Cashew nut farmers in the country have lost approximately N99 billion since the commencement of production this year.

The farmers produce about 220,000 metric tonnes of cashew nuts yearly. This year, however, the cost plummeted to N150,000 per tonne. The figure implies that they lose N450,000 on every tonne sold. Multiplied by 220,000 metric tonnes, the farmers are set back by a staggering N90billion.

Anga noted that persistent downward prices of cashew had in turn resulted in supply glut in producing countries, including Nigeria.

He lamented the lack of investment and interest from financial institutions in the sector, which he described as capital intensive.

He stressed the need to increase investment in cashew processing to add value to the cashew value chain.

He is, however, optimistic about reaping from the industry this year, adding that high yielding cashew seedlings had been planted in Kwara, Oyo and Cross River states. According to him, investors acquired 500 hectares of farmland in Calabar, Cross River State and commenced the planting of hybrid cashew seedlings.

He said: “We need to grow the next generation of cashew that will make Nigeria great. The good thing with cashew is that once it gets to maturity in four years, for the next 45 years, it will continue to produce fruits.

“The cashew trees that are currently in existence were planted between 1950 and 1970 and the average lifespan of a cashew tree is 50 years. The ones in existence are more than 50 years and if something is not done about this, we may wake up one day to know that cashew trees are no longer yielding fruits.’’

Globally, demand for cashew is huge at three million metric tonnes and the global production is 1.9 million metric tonnes.

The Nigerian Export Promotion Council (NEPC) has advised farmers and cashew nuts merchants to prioritise local processing over export of raw nuts.

According to the council, this will add value to the crop’s value chain, and boost earnings. Nigeria currently exports 95per cent of its raw cashew nuts, leaving only an abysmal five per cent for local processing and consumption. This is because there are very few factories that process the crop in the country.

Nigeria’s cashew is usually harvested between February and June, though farmers stock the crop and export it all year round.

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Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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