Country Update: A Rise in Cashew Processing on the Horizon in Tanzania

Sector and Government agencies in Tanzania are shifting their focus to cashew processing as an industry with great economic potential.  Currently, Tanzania produces over 150,000 TPA of RCN, however the current installed processing capacity is less than 20% of this annual crop.  Various stakeholders in the country are taking action to change this deficit in processing capacity in order to meet the country’s large RCN production.  In early November,the Agriculture Non-State Actors’ Forum (ANSAF), in collaboration with other agencies, organized an Investors Conference in the country which promoted  cashew processing.  ACA Managing Director Roger Brou and ACA Business Advisor Sunil Dahiya attended the two day conference and met with a number of stakeholders throughout.  Additionally, Brou and Dahiya presented ACA and its activities to conference participants during a conference session. ACA MD Roger Brou stated that “the 2 day conference shed some light on the status of the current situation of the cashew value chain in the largest producing country in East Africa” and was “a great opportunity for the ACA Team to meet and greet a number of private sector companies as well as sector associations for further collaboration on the ground”.

In another effort to increase cashew processing in Tanzania, the Tanzanian Investment Bank (TIB) has shown great interest in supporting TANECU, one of the largest and organized farmer co-operative unions, in establishing a cashew processing unit in Southern Tanzania.  TIB approached the African Cashew Alliance in March 2013 for technical advisory as they work towards building a facility and ACA agreed to assist on feasibility assessments and business planning for the venture. TIB aims to finance a facility with 15,000-35,000 TPA processing capacity, which will be developed by TANECU.

From the 9^th-11^th of December, ACA’s Business Advisor, Sunil Dahiya, visited Southern Tanzania with Brazilian Industry Expert, Sebastiao Ricardo Fonteles Castro to collect inputs and information for an Environmental Analysis and Project Feasibility Study.  This Study comes as part of the agreement that ACA signed with the Tanzania Investment Bank (TIB). During their visit, Dahiya and Castro interviewed several key cashew sector agencies and visited the potential sites for the upcoming cashew processing facility. This cashew factory, owned by TANECU, would process nuts from over 80,000 farmers represented by TANECU. ACA has already delivered a Market Analysis to TIB and will be delivering the Environmental Analysis and feasibility study by early February, 2014. These studies will assist TIB in its review of the working capital requirements, performance risk analysis, technology needs, and financial projections for the project. Based on the proposed processing capacity of the facility, the fully operational factory could provide up to 1,000 jobs.