Maputo — The Mozambican Association of Cashew Industries (AICAJU) has warned that less than 35,000 tonnes of cashew nuts will be processed in Mozambican factories this year, which is more than 33 per cent less than the 52,000 tonnes processed last year.
In a Monday press release, AICAJU notes that Mozambique has less than ten processing plants operating and some of these will stop processing in the middle of this year, probably in August, for lack of raw materials.
There has been a continuing decline in Mozambican cashew processing in recent years. AICAJU says that 60,000 tonnes of nuts were processed in 2018.
The Mozambican processing plants, says the release, “are operating in a particularly adverse context, in which the national industries face growing, aggressive and protected competition from international players such as India and Vietnam”. So far there has been no effective response by Mozambique “to this new paradigm”.
India last year increased its surtax on imported processed cashew kernels from 45 to 70 per cent. This, says AICAJU, “increased still further the purchasing power and the capacity to influence markets of India’s own industries”.
For, while Indian buyers are discouraged from buying the finished product from Mozambique, India continues to buy Mozambican raw, unprocessed nuts.
“The Asian processors can now buy in Mozambique raw material at inflated and unfair prices, distorting the market with a negative impact on Mozambican industry and, ultimately on the Mozambican state coffers”, the release protested. In other words, Mozambican industries find it difficult to sell cashew kernels to the Indian market, while the Indian industries snap up thousands of tonnes of raw nuts from Mozambican farmers, at prices the Mozambican processing factories cannot compete with.
On top of this has come the impact of the Covid-19 pandemic. The price of cashew kernels has fallen by more than 15 per cent since the start of the Covid-19 crisis, and by 25 per cent when compared with last year’s prices.
Nonetheless, AICAJU declared its confidence in the measures the Mozambican government is taking and believes that “through discussions between the state, the private industry and the cashew producers, it will be possible to implement measures in good time to defend the sector, which will allow a cashew campaign in 2020 that is fair for all the stakeholders”.
AICAJU also called on the government to provide support for farmers to develop the cashew orchard, “otherwise production will suffer a sharp decline, with a resulting impact on the income of more than 1.4 million households that are dependent on cashew nuts”.
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