A Value Chain Analysis of the Cashew Sector - AGOA Export Toolkit
A Value Chain Analysis of the Cashew Sector - AGOA Export Toolkit A Value Chain Analysis of the Cashew Sector - AGOA Export Toolkit
18 Figure 2.1 Cashew Value Chain Operators and their Functions Specific Inputs Production Transformation Commerce / Trade Consumption ÿ Supply of seeds ÿ Supply of agrochemicals ÿ Supply of specifi c information to producers ÿ Supply of equipment and packaging materials ÿ Agrochemical dealers ÿ Seed dealers ÿ Equipment/ packaging dealers ÿ Seed sowing ÿ Weeding, spraying ÿ Harvesting ÿ Sale of RCN ÿ Hiring of wage labourers ÿ Post-harvest handling (grading included) ÿ Small- and largescale producers ÿ Producers’ associations ÿ Outgrowers ÿ Seasonal labourers Functions ÿ Bulk purchase of RCN ÿ Sorting ÿ Cracking, peeling ÿ Grading, roasting ÿ Packaging Participating Actors ÿ Processors/ entrepreneurs ÿ Wage labourers ÿ Roasters Th e cashew industry in Ghana currently boasts 12 processing companies with a total installed capacity of 2,137 t per year. Th e only medium processing company is Mim Cashew Products which has an installed capacity of 1,000 t per year and, as the name implies, is located in Mim. Th e remainder are small enterprises with an installed capacity ranging from 10 to 250 t per year. Th ese companies process kernels for export, while the bulk of secondary processing takes place around Accra. Th ere are 21 kernel roasting companies operating in diff erent parts of the country. 17 of these are to be found in the Greater Accra Region, three in the Brong-Ahafo Region and one in the Eastern Region. Th e kernels they roast are sold at hotels, restaurants and supermarkets. Th e “Cashew Processing, Marketing and Consumption in West Africa” (USAID 2007) study concludes that the average retail price of locally processed cashews is highest in Ghana and Côte d’Ivoire – higher even than that of imported Asian cashews. If prices cannot be reduced signifi cantly, the local market for cashews will be dominated by imports. In addition, Gha na ian producers do not use all of the market channels avail able within the country eff ectively. As a result, products do not reach all potential points of sale, and potential buyers or sellers (such as hotels) are underserved. Distributors: these include local traders, intermediaries, (agents), retailers and exporters. There are nine local RCN buyers, plus the four foreign companies in operation during the 2008 harvesting season. Th e agents of these companies purchase RCN by travelling from one marketing centre to another and ÿ Harvesting, collection and purchase of cashews from producers ÿ Post-harvest handling ÿ Sale of cashews to exporters/traders ÿ Payment for transport ÿ Agents/traders ÿ Middlemen ÿ Wholesalers/retailers (supermarkets) ÿ Exporters ÿ Consumption of roasted kernels ÿ Households (urban, domestic and export) ÿ Hotels ÿ Restaurants sometimes travel to the farming communities themselves. Agents and traders are responsible for transporting cashews to ports and pay for the related costs. Th ey sell RCN to exporters directly and, in some cases, to secondary intermediaries or middlemen. Exporters: these are few in number and operate mostly from the Brong-Ahafo Region, as well as from marketing centres in other cashew growing areas of Ghana. Th e RCN are collected in bulk and packed into jute sacks obtained from associations. Th ese are then transported to Tema harbour, where they are shipped to target markets such as India and Vietnam. Consumers: the majority of consumers buy locally roasted kernels from supermarkets and other retailers. 2.2.2 Marketing Channels and the Local Cashew Trade Th e diagram that follows depicts the marketing channel for raw cashew nuts produced in Ghana. Only 2% of these are processed locally, while the remaining 98% are exported to India. World prices for cashew kernels fl uctuate, as is particularly the case for raw nuts from Africa. Farm gate prices reached a peak in 2000, before they collapsed by 50% in 2001. In Ghana, the farm gate price for RCN was US$ 0.52 per kg in 2009. Th is compares with the price range of US$ 0.31 per kg to US$ 0.54 per kg identifi ed by a survey of three West African countries conducted in 2006. In 2009, the realised sales revenues from cashews in Ghana were:
Farm gate price of RCN per kg = US$ 0.52 Processing centre price per kg = US$ 6.80 of WW320 kernels Roasting centre price per kg = US$ 10.00 of roasted kernels Retail price per kg of roasted = US$ 17.00 and packaged kernels Figure 2.2 Illustration of Existing Marketing Channels Local RCN Traders/Buying Agents 100 % Exporters of Raw Nuts to India Processors in India 98 % 2 % Indian Household Consumption Producers of Raw Cashew Nuts in Ghana Exporters of Kernels 98 % 2 % Local Household Consumption Private Processors 70 % 25 % 5 % Indian Roasters Roasters abroad Local Roasters Household Consumption Wholesalers/Retailers Wholesalers/Retailers abroad Wholesalers/Retailers (local traders) 96% Total 2% remain in Ghana for processing and world-wide distribution (Output: 1,86%) 98% 100% 1,38% Total Global Consumers Th e marketing of RCN is currently one of the most critical issues of concern for farmers. RCN are marketed between February and May each year, and without much structured organisation to the underlying process. Basically, RCN marketing companies visit known cashew farming communities individually to either purchase RCN directly from farmers, or to collect the RCN already purchased at an agreed price by their locally commissioned people and local marketing agents. Th us, the marketing channel consists of producers, village merchants, or agents and exporters. Since this is an activity restricted to only four months in the year, there are 98% Import to India for processing and worldwide distribution (Output: 96%) 2% 0,5% Total 19
- Page 1 and 2: A Value Chain Analysis of the Cashe
- Page 3 and 4: A Value Chain Analysis of the Cashe
- Page 5: Table 2.2 Farm Gate Producer Prices
- Page 9: Value chain addition regarding cash
- Page 12 and 13: 12 ductivity and insuffi cient nut
- Page 14 and 15: 14 Table 1.2 Essential Data/Informa
- Page 16 and 17: 16 Table 1.6 Policies Governing the
- Page 20 and 21: 20 Table 2.2 Farm Gate Producer Pri
- Page 22 and 23: 22 Cashew is grown as a smallholder
- Page 24 and 25: 24 An Economic Analysis of Annual C
- Page 26 and 27: 26 Table 2.6 Technical and Economic
- Page 28 and 29: 28 Table 2.7 Needs Assessment for S
- Page 30 and 31: 30 2.6.1 Demand and Supply of Finan
- Page 32 and 33: 32 Table 2.13 Programmes/Projects I
- Page 34 and 35: 34 ÿ Geographical proximity to pri
- Page 39 and 40: List of Acronyms ACA African Cashew
- Page 41 and 42: Author(s) Title of Document/Materia
- Page 43 and 44: Appendix II: Further Sources of inf
- Page 45 and 46: Notes 45
- Page 48: Published by: Deutsche Gesellschaft
Farm gate price <strong>of</strong> RCN per kg = US$ 0.52<br />
Processing centre price per kg = US$ 6.80<br />
<strong>of</strong> WW320 kernels<br />
Roasting centre price per kg = US$ 10.00<br />
<strong>of</strong> roasted kernels<br />
Retail price per kg <strong>of</strong> roasted = US$ 17.00<br />
and packaged kernels<br />
Figure 2.2 Illustration <strong>of</strong> Existing Marketing Channels<br />
Local RCN Traders/Buying Agents<br />
100 %<br />
<strong>Export</strong>ers <strong>of</strong> Raw Nuts to India<br />
Processors in India<br />
98 %<br />
2 %<br />
Indian<br />
Household<br />
Consumption<br />
Producers <strong>of</strong><br />
Raw <strong>Cashew</strong> Nuts in Ghana<br />
<strong>Export</strong>ers <strong>of</strong> Kernels<br />
98 % 2 %<br />
Local<br />
Household<br />
Consumption<br />
Private Processors<br />
70 % 25 % 5 %<br />
Indian Roasters Roasters abroad<br />
Local Roasters<br />
Household<br />
Consumption<br />
Wholesalers/Retailers Wholesalers/Retailers abroad<br />
Wholesalers/Retailers (local traders)<br />
96% Total<br />
2%<br />
remain in Ghana for<br />
processing and<br />
world-wide distribution<br />
(Output: 1,86%)<br />
98% 100%<br />
1,38% Total<br />
Global Consumers<br />
Th e marketing <strong>of</strong> RCN is currently one <strong>of</strong> <strong>the</strong> most critical<br />
issues <strong>of</strong> concern for farmers. RCN are marketed between<br />
February and May each year, and without much structured<br />
organisation to <strong>the</strong> underlying process. Basically, RCN marketing<br />
companies visit known cashew farming communities<br />
individually to ei<strong>the</strong>r purchase RCN directly from farmers,<br />
or to collect <strong>the</strong> RCN already purchased at an agreed price<br />
by <strong>the</strong>ir locally commissioned people and local marketing<br />
agents. Th us, <strong>the</strong> marketing channel consists <strong>of</strong> producers,<br />
village merchants, or agents and exporters. Since this is an<br />
activity restricted to only four months in <strong>the</strong> year, <strong>the</strong>re are<br />
98%<br />
Import to India<br />
for processing and<br />
worldwide distribution<br />
(Output: 96%)<br />
2%<br />
0,5% Total<br />
19
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