Cashew Exports: Ghana Risks Losing International Market

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Ghana’s cashew stands the risk of being blacklisted on the international market due to substandard nuts.
Information gathered by Business Journal has revealed that major exporters from importing countries including India and Vietnam have complained that the commodity gets rotten by the time it gets to their countries.
The complaint was made at a meeting between the exporters, representatives from the Finance Ministry, Trade Ministry, Ghana Export Promotion Authority (GEPA) and the Cashew Nuts Association of Ghana, recently.
A representative from one of these institutions confirmed this, and attributed the situation to lack of regulations as exporters, mainly foreigners, are allowed to buy the commodity directly from farmers without any quality test.

While the nuts need to be properly dried before they can be bagged for export, the farmers, who are also faced with lack of financial support to operate their farms, are mostly in a hurry to sell the produce that are not well dried at cheaper prices.
Experts have argued that the country’s inability to add value by processing the commodity locally, and lack of proper warehousing system to ensure quality testing, account for such situation.
The country produced 90,000 metric tonnes of cashew last year, a significant increase over the 75,000 metric tonnes produced in 2016.
The foreigners, who made these complaints, are the very people who serve as middlemen that have taken over the buying and marketing of the commodity.
They are the main determiners of market prices because local buyers lack the capacity to buy in large quantities for export.
In a rather bizarre twist of events, the activities of these foreigners are pushing local entrepreneurs out of the industry.
The foreigners bring people from their countries, who pose as tourists, but are actually brought in to shell and bag the nuts; activities which hitherto were done by Ghanaians.
Consequently, the number of Ghanaians involved in such work has been halved from 6,000 to 3,000.
Information gathered has revealed that each exporter brings in, not less than 20 people, to do the casual jobs such as tallying, cutting, quality testing and bookkeeping.
“I was having about 25 people doing these jobs, but because of this I have had to reduce the number to 12. Instead of increasing employment, we are decreasing the numbers,” Secretary of the Cashew Nuts Buyers Association, Alhaji Justice lamented.
He believes the lack of proper regulations by government accounts for the problem.
“I have a company in Ivory Coast and, before I could operate in that industry, I had to pay a huge sum of money for my documents and also pay about GHS50, 000 for my license. But here, nothing of the sort is happening. They can just come in and operate without any control from the State.” Justice added.
He said several meetings with the Trade Ministry and Ghana Export Promotion Authority (GEPA) have not yielded much result.
Government in March, last year, moved to prevent farmers from selling their produce directly to buyers as it took steps to regulate the sale.
But the directive was rejected by the Cashew Farmers Association, which claimed the directive came rather late, as most farmers had already started selling their produce because majority of them had taken loans from buyers even before they harvested their yields.
The Cashew Nuts Buyers Association wants the foreigners to be restricted to operate only in the ports.
“They now take Kia trucks and scale and buy from the farmers, offering them high prices and buying ours at far lower prices than we even bought from the farmers, so indirectly they are pushing us out of the business. The foreigners should be restricted to the ports and not to enter the field,” Justice further stressed.
Comparatively, Ghana’s neighboring country, Ivory Coast, has managed to grow its industry to become the World’s leading producer with 702,510 tonnes produced last year. Ghana with similar soil and climatic conditions could only do 10 percent of theirs.
Instructively, only five percent of Ghana’s cashew output is consumed locally.