Cote d'Ivoire is the world's number one cashew producer notwithstanding a drop in 2016 production due to poor weather. Now however, local cashew nut producers are unhappy over the government set producer price of USD0.71/kg1 as against the sought after USD0.96kg – leading to substantial smuggling across the border.
This is a long-term issue for the country. In 2016, an estimated 100,000 tons of cashew nut were smuggled to neighbouring countries including Ghana for example, where the the buying price was US$1.53/kg as opposed to US$0.56/kg2 in Cote d'Ivoire.
Main Findings
- In 2016, targeted production was 725,000 tons but only 649,587 was achieved3. Still roughly 25% of global production. The country aims to produce 1 million tons within three years and the industry directly and indirectly employs 1.5 million people in the country4.
- The calls for a halt to smuggling came from the secretary of the Fédération nationale des acheteurs d'anacarde et de coopératives de cajou de Côte d'Ivoire (FENACACI), Abdoulaye Sanogo. He said that the activity "weakens the sector because the state is unable to collect its DUS [taxes] which leads to unfair competition5.".
- Despite continued threats from smuggling and black market dealings, outlook for the cashew industry in Cote d'Ivoire is very strong. Good weather at the end of 2016 means that the target for 2017 is a record one, which if achieved, would further cement the country's top producer status.
Outlook
Refined products normally account for less than 10% of all Ivorian cashew exports. Government has realised the potential in this market and has implemented a range of bonus payments for those selling refined products. There are plans to scale up installed refining capacity from 90,000 tons to 214,500 tons by the end of this year6.
Meanwhile, the discontent of cashew nut producers should be viewed as part of a larger problem of dissatisfaction among low-level agricultural producers and bottom of the pyramid Ivorians. Their situation is made more difficult by the volatility of external demand.
Footnotes
1 http://news.abidjan.net/h/609748.html
2 http://news.abidjan.net/h/608856.html
3 http://news.abidjan.net/h/610022.html
4 http://medafricatimes.com/9377-cote-divoire-becomes-worlds-cashew-nuts-top-producer.html
5 http://news.abidjan.net/h/610022.html
6 http://www.reuters.com/article/us-ivorycoast-cashew-idUSKBN13D2OM
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