by Steve Agbota
Despite losing several billions of dollars in 2016 to lack of value addition, Nigeria appears not to have learnt useful lessons on how to boost revenue from cashew export.
The cash crop, regarded as one of the nation’s economic trees, has the potential to create enormous wealth for farmers and generate huge foreign exchange to government’s coffer.
A recent data from the National Cashew Association of Nigeria (NCAN) showed that Nigeria exported a total of 160,000 metric tonnes of raw cashew valued at $300 million in 2016. This figure was far behind what farmers and exporters could have earned assuming there are processing factories to process cashew nuts for export.
In order to maximise the potential of the golden tree, Nigeria is set to supply 130,000 tonnes of roasted cashew nuts valued at $7 billion to Walmart Super Market chain in the United States of America.
The Minister of Agriculture and Rural Development, Audu Ogbe, said the US firm came to Nigeria to request for 130,000 tonnes of roasted cashew nuts and their demand is 130,000 tonnes of cashew nuts per annum, with a total value of $7 billion.
The Minister announced that, “we are in conversations with Walmart, the biggest supermarket chain in the US. They came here and asked us to roast cashew nuts for them. What Nigeria currently does is ship the nuts to Vietnam, which in turn roasts and sell to the US. This year, we are going to create six cashew processing factories in Nigeria, each to be cited in Enugu, Imo, Benue, Kogi, Kwara and Oyo states. These are the cashew belts for now. These options are coming now because Nigeria is beginning to focus on non-oil export.”
Daily Sun learnt that currently a tonne of processed cashew nuts, when exported, is sold for $10,000 while the raw cashew nuts are sold at $1,200 at the international market.
Cashew grows very well in virtually all agro-ecological zones including the semi-arid areas but with high concentration in the middle belt areas in smallholder farms and plantations and provide livelihood for over 300,000 families and has created 600,000 jobs in the country. Cashew production comes from over 28 states, including Kogi, Kwara, Oyo, Edo, Ondo, Benue and Cross River, among others.
To meet the Walmart’s demand, stakeholders said that government must ensure that farmers embark on massive production of cashew and take value addition extremely serious. They said government should also ensure that smuggling activities on the nation’s land borders are controlled.
The stakeholders hinted that over 30 per cent of cashew nuts produced in Nigeria annually are smuggled across the border as a result of price discrepancy in cashew moved into the global market by other countries like Benin Republic, as the crop fetches a premium in the international market.
Speaking with Daily Sun, President of the National Cashew Association of Nigeria (NCAN), Mr. Tola Faseru, said that if government were that committed, it would be able to meet the demand of Walmart, which means government is ready to do a lot more across the value chain. For government to earn the $7 billion, he said there was need to increase production of cashew, improve its quality in terms of processing, adding that value addition has to be supported.
He added: “It is expected that in order to meet all of these, the farmers need to be supported, funding has to be made available, infrastructure and a whole lot of things have to be put in place because now you are committing yourself to giving so much quantity, which is final product. That means the whole value chain has to be retooled for us to be able to make this happen.
“We are excited about the Minister’s declaration and we hope ultimately, he would walk the talk because he is interested in changes and if he has the support of the Federal Government, it will become something that would be achievable.”
Speaking on the budget allocated to the agriculture sector, he said, “government can only give what it has. Budget goes beyond the figure, it is how well budget allocated is utilised and having the focus on where they want to get to. The vision, which you can now begin to look at making provision for, should be what you want to achieve in the next five years in terms of production and value addition; how many factories we want to see, what level of cashew processing we will want to achieve.”
According to him, for each commodity, there should be serious private public sector collaboration with regard to input and then Nigeria can get the right output.
He noted that each of these commodities can create a whole lot of difference for the economy, from cocoa to cashew and sesame seed, urging government to set up a task force by formulating a policy that would create enabling environment for each of these commodities to thrive and bring about the needed transformation to the economy.
On his part, Chief Executive Officer, Universal Quest Limited, Mr. Anga Sotonye, explained: “This is a challenge on Nigeria. This demand has brought upon us a big economic challenge. To be able to meet up that order, we will have to significantly increase our cashew production, which starts with the farm. We need to increase the areas we will put under cashew cultivation nationwide because $7 billion is not N7 million; it’s a whole lot of money.
“We don’t have that volume of cashew because we have not produced that volume of cashew on a national basis; we don’t have it. So we would not be able to fulfil that order. To fulfil it, we will have to deliberately grow more cashews, we have to put our farmers to work again, we have to get our land and grow more cashews, so that we would be able to supply and meet this demand. And what that means is that we would be able to meet this demand, we would be able to create more jobs for our people, earn more foreign exchange and we would be able to build the cashew industry better because all of this is about foreign exchange, we would be bringing much needed dollars into the country.”
He said there was need to add value to cashew nuts and then make available processed cashew nuts to Walmart, which he said starts with farm, increased production and improvement on the nation’s process capacity.
On budget allocation to the agriculture sector, he said, “it is still very small. We have not reached anywhere but it is also very important that business should be left for business people to do and government should not do business. We should allow the businessmen to run the business while government should provide the conducive environment to enable business to grow. But budget allocation has to be significantly improved in Nigeria. The budget allocation is still very small and we need to do more because we need to build agriculture.”