The ACA is empowering the cashew industry
Saturday, August 7 2010
The African Cashew Alliance started just five years ago with 24 members, including USAID’s West Africa Trade Hub. Until late 2009, the Trade Hub was home to the ACA’s secretariat and the Trade Hub’s cashew sector advisor managed its activities. Gradually, the ACA has become an autonomous entity, receiving Trade Hub grant support and technical assistance. Today, it has almost 100 members spanning the globe. As the ACA gears up for its fifth annual conference, Tradewinds asked ACA President Carlos Costa for an assessment of progress made as it marks its fifth year.
If Africa’s entire cashew crop was processed locally (instead of the only 10% processed today), almost 300,000 new jobs could be created by more than 1,000 businesses directly and more than US$280 million dollars in added value would be realized. This quite possible outcome is what drives the African Cashew Alliance’s work in every cashew-producing country on the continent and with its members and partners around the world.
We are currently preparing our fifth annual conference and, looking over what’s happened since the organization began in 2005, it’s easy to see why an industry alliance has been so important. Register today for the conference!
First and foremost, it’s helped stakeholders across the industry advance toward that goal of helping improve the livelihoods of the almost 2 million cashew farmers in Africa. Happily, we have continued to make steady progress toward this goal. In late July, another processing company opened in western Cote d’Ivoire, in a town called Touba.
The company immediately will employ 140 people – about 80 of who are women. But many, many more people – probably all of Touba’s 30,000 residents – will be positively affected.
Farmers who cultivate cashew trees now have another buyer – and a more stable market for their raw cashew nuts. The company will need supplies and much of that will come from local vendors. It will use local trucking companies to move its goods. And the government has a new source of tax revenue.
Consider that within just the last three years, the quantity of raw cashew nuts actually processed in Africa has more than doubled: in 2006, local processing of raw cashew nuts produced about 7,000 metric tons of cashew kernels ; last year, that figure had reached 15,000 metric tons. In particular, West Africa went from below 500 metric tons in 2006 to more than 5,500 in 2009!
The 15,000 metric tons of African kernel processed locally correspond to about 75,000 metric tons of raw cashew nuts or 10% of Africa’s crop. The cashew processing industry in 2009 supported the livelihoods of about 250,000 farmers in 11 African countries – more than 1,250,000 people if you count the dependents.
In 2009, farmers earned a total of about $40million from selling cashew nuts to cashew processors, or about $160 per farmer household. Cashew-related income represents about 20-30 per cent of the total household income on average.
Cashew processing jobs are empowering thousands of rural women in Africa.
They earned more than US$16million in salaries. You might say that is only $530 per person per year but keep in mind that the factories typically pay about 20-40% higher than the average income and it is literally an improvement from $0 yearly income before they opened their doors.
These improvements can be at least partly traced to a $25 million grant of the Bill & Melinda Gates Foundation. That grant – matched by $25 million from the industry – has funded the African Cashew Initiative, which is focusing on five African countries in the first phase but is expected to be extended to more countries after 2012.
In the first phase, the ACi project aims to increase the cashew-related income of 150,000 cashew farmers by $100 – or $15 million. The project also aims to increase local processing of raw cashew nuts by 50,000 metric tons – in other words, bring an extra 10,000 metric tons of kernel processed in Africa to the market. This should create more than 10,000 new jobs depending on the processing technology used. The minimum objective for the four-year is to create more than 5,500 new jobs.
Over a possible ten-year period, the ACi project aims to raise the percentage of RCN processed to about 60% in ten selected countries. This would affect at least 500,000 farmer households, i.e. more than 2.5 million people. It would bring an additional 60,000 metric tons of kernel to the market by 2019. That corresponds to 300,000 metric tons of raw cashew nuts. It could create up to 115,000 new jobs.
Cashew is contributing significantly to the food security of hundreds of thousands of people in the rural areas of Africa. It provides a source of cash income to purchase food during the dry season when people need cash to purchase food on the markets.
Five years is actually a very short time, but for the ACA it has seemed like a long time. When we started, our goals were actually quite modest. We knew that bringing stakeholders together was a natural way to help the industry grow, but the impact we’ve had has exceeded our expectations. We now have committees working on industry issues in many countries and we’ve helped companies across the continent increase their productivity, improve their marketing and realize greater success.
The secretariat now has its own office and a full-time staff of five people. They are making sure that potential opportunities actually become realities. The ACA staff, with critical partners at Technoserve, GTZ and FairMatch Support, have helped companies develop business plans that win bank loans, find appropriate technology, lay out factories for maximum efficiency, identify market and improve their operations, generally.
We’re proud of that work but we’re also focused on the future. The industry holds such enormous potential – the excitement comes in seeing it realized.
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