How a Dearth of Processors Is Holding Back Nigeria's Cashew Exports
Updated: 13 hours ago
In short: Africa grows more than half of the world's raw cashew nuts, but most of the crop leaves the continent unprocessed, and the jobs and value go with it. In Nigeria, processors are held back by the cost of machinery, competition for raw nuts at harvest and unreliable power. Vertex Agro's Managing Director, Daniel Gemana, argues that targeted support for local processing would pay off in jobs and export earnings.
This article draws on reporting by The Nation in 2022, including an interview with Daniel Gemana. Figures reflect that period.
Africa grows the cashews, but others capture the value
Cashew is one of Africa's most promising export crops. In 2022 the African Cashew Alliance estimated the continent's raw cashew nut (RCN) production at around 2.1 million tonnes, about 57% of the global harvest. Yet very little of it is processed where it is grown.
Instead, most raw nuts are shipped to Vietnam and India, which together accounted for around 98% of world RCN imports. There the nuts are shelled, graded and re-exported as kernels to the United States, Europe, the Middle East, China and Australia. The United Nations Conference on Trade and Development (UNCTAD) has pointed out that processing more of the crop locally could raise incomes for Africa's roughly three million smallholder cashew farmers.
What is holding back cashew processing in Nigeria?
In 2022 Nigeria's cashew sector was estimated to support more than 300,000 families and 600,000 jobs, but there were no reliable figures for the country's processing capacity. Speaking to The Nation, Daniel Gemana, who set up Vertex Agro's processing plant in Gauraka, Tafa LGA, Niger State, identified four main obstacles:
Cost of machinery. Local processors struggle to raise the capital needed to buy processing equipment.
Access to raw nuts. Foreign buyers visit farms at harvest and buy raw nuts directly, leaving local factories short of supply.
Power and water. Unreliable electricity forces many processors to run below their installed capacity.
Finance and incentives. Processors want access to loans for processing plants, and incentives that would attract new investors into the sector.
Gemana called on government to create an enabling environment for domestic processing, and said processors were planning an association to give the industry a stronger voice with policymakers.
What other cashew-producing countries are doing
Côte d'Ivoire, the world's largest exporter of raw cashew, introduced a levy of CFA 30 per kg on raw nut exports to fund processors and committed more than $20 million to support them, with a target of processing 50% of its crop by 2025–26.
Tanzania exported 206,719 tonnes of raw nuts in the 2020/21 season. A study by the Agricultural Non-State Actors Forum (ANSA) estimated this cost the country around Sh216 billion and more than 63,000 potential processing jobs.
For more on how the region is approaching local processing, see our key takeaways from the 18th African Cashew Conference.
Building supply at the farm level
Processing only works if factories can buy enough good-quality raw nuts. In 2022:
The National Cashew Association of Nigeria (NCAN) was distributing improved seed varieties that can begin fruiting in about two years, compared with around three years for typical trees.
The USDA-funded PRO-Cashew project, implemented by CNFA, was training farmers and working with the Cocoa Research Institute of Nigeria on cashew mother-tree selection, with plans to distribute more than 200,000 grafted seedlings through nurseries.
Vertex Agro ran its own extension programme for cashew farmers in Kogi State, which aimed to source raw nuts directly from smallholders.
Why local processing matters to Vertex Agro
Gemana's argument is that processing creates value well beyond shelling. By-products of the raw nut can feed into food products and into fertilizer. At Vertex Agro we put that into practice: we process cashew for Gemana Cashews and turn the leftover shells into Vertelizer, our bio-organic fertilizer.
Frequently asked questions
Why does Nigeria export raw cashew nuts instead of kernels?
Because local processing capacity is limited. Processors face high equipment costs, unreliable power and strong competition from foreign buyers for raw nuts at harvest, so most of the crop is sold and shipped unprocessed.
Which countries process most of Africa's cashews?
Vietnam and India. In 2022 they accounted for around 98% of world raw cashew nut imports, shelling the nuts and re-exporting the kernels.
How much of the world's cashew does Africa grow?
More than half. The African Cashew Alliance estimated African production at about 2.1 million tonnes in 2022, roughly 57% of the global total.
What does Vertex Agro do with cashew shells?
We turn them into Vertelizer, a bio-organic fertilizer that improves soil structure and helps the ground hold water, and we use shell waste as fuel in the factory.
This is amazing A big weldone to Daniel for his wonderful thinking