Cashew Producers Warn Against Export Ban, Seek Low-cost Loans

Nigeria’s cashew industry has warned that any move to ban the export of raw cashew nuts without first addressing structural challenges could hurt millions of farmers, reduce production and weaken the country’s competitiveness in the global market.

The warning was issued in Abuja on Monday by the National Cashew Association of Nigeria (NCAN) where they reviewed the state of the sector and policy options for growth.

NCAN national president, Dr Ojo Joseph Ajanaku said Nigeria’s cashew value chain supports more than five million people, largely smallholder farmers cultivating less than one hectare each.

He said policies that depress farmgate prices in favour of local processing would place an unfair burden on producers already struggling with rising input and logistics costs.

Ajanaku said many farmers face difficult terrain and spend heavily moving produce from remote farms to collection centres and urban markets. He added that after transportation and production expenses, many growers are left with only a fraction of the value of their harvest.

According to him, processors currently relying on commercial loans at rates of between 25 and 35 per cent cannot sustainably store raw materials or compete with better-supported rivals in other producing countries.

Rather than impose restrictions, the group urged government to create incentives for processors through special agro-industrial loans at single-digit interest rates of between three and five per cent, while allowing farmers to continue selling produce at market-driven prices.

It also called for renewed investment in seedlings, extension services, rural roads and security in farming communities, noting that insecurity in remote producing areas has affected harvesting and access to farms.

The association maintained that stable pricing this season has shown the benefits of a more transparent market environment and expressed optimism that with the right reforms, Nigeria can regain lost ground in the global cashew trade.

He said, “It will only be at the expense of our farmers if we ban export of raw cashew nut in Nigeria. And this is why we are saying that we are protecting the sector for sustainability. Let us do it in a way that the economy of this nation will be sustained.

Nigeria cashew industry is employing over 5 million people on a lower estimate. For you to get one tonne of cashew from the farm, you need minimum of 10 persons. And if we want to process all the cashew that is produced in Nigeria, say we want to process the 350,000 metric tonnes of cashew that we have in Nigeria, we cannot employ more than 35,000″.

“The best way to go is to ensure our farmers are not shortchanged while processors are supported through special loans of three to five per cent.

Cost of funding is high. production, harvesting season is just between three months and four months. You need to store minimum of nine months to eight months what you process all through the year”.