Ivory Coast’s Cashew Processors Call on Government for Support
Cashew nut processors in Ivory Coast are urging the government to renew a subsidy deal, expressing concerns about potential bankruptcy if the struggling sector does not receive adequate support. Despite Ivory Coast being the world’s largest cocoa producer, it has emerged as a significant cashew nut grower. Yet, only a tiny fraction of its nuts undergo local processing due to stiff competition from well-funded Asian exporters.
The Ivory Coast Cashew Industry Group (GTCI), representing five cashew processors with an annual processing capacity of 41,000 metric tons, submitted a letter to the government in December, requesting the renewal of an arrangement that guaranteed the supply of raw cashew nuts, constituting up to 20% of GTCI’s processing capacity at the beginning of each season. With the impending 2024 processing season, the GTCI warns that its members risk bankruptcy without the necessary support.
The letter emphasizes the importance of renewing the agreement for the next four years, seeking a continuation of the state support that has amounted to approximately 10 billion CFA francs ($16 million) annually for the past two years, according to a government source. However, the request is being weighed against budget constraints, as substantial subsidies for cashews and cocoa are straining public funds.
Ivory Coast’s cashew nut output is expected to increase to 1.25 million tons this year, a 5% rise from 2023, according to Agriculture Minister Kobenan Kouassi Adjoumani. Despite this growth, the local processing industry faces significant challenges, as data shows that only 22% of the country’s cashew nut output was processed domestically in 2023.
The sector heavily relies on foreign exports, with 81% of cashew nut exports going to Vietnam and approximately 18% to India. This underscores the need for strategic government intervention to support local processing and ensure the sustainability of the cashew industry in the Ivory Coast. The ongoing negotiations highlight the delicate balance between supporting vital economic sectors and managing fiscal constraints.
