Ghana's Cashew Industry Faces Struggles Despite High Demand

Ghana, the world's third-largest exporter of raw cashew nuts, grapples with challenges in processing and supplying higher-value products. Despite booming demand, local farmers and entrepreneurs highlight the need for government support, access to affordable credit, and improved infrastructure to boost the industry.

Ghana is known for its rich agricultural produce, and cashew nuts are among its key export crops. However, a visit to a busy market in Accra reveals the stark discrepancy between the price of raw cashew nuts and their roasted, packaged counterparts. While a 30-gram bag of roasted cashews may cost around $0.75, local farmers receive only about $50 for a 100-kilogram sack of the same nuts in their unprocessed state.

The reality is that Ghana is the third-largest exporter of unprocessed cashews globally, following Ivory Coast and Cambodia. The sector supports an estimated 300,000 Ghanaians, yet farmers face precarious working conditions and unstable market prices. Nashiru Seydou, a farmer from the northeastern part of the country, expressed his frustrations with the system, which leaves many struggling to make ends meet.

"Using our sunlight and fertile land can create more jobs, but we need government support," Seydou lamented. Entrepreneurs like Bright Simons have applauded the potential for profit in processing cashews, noting that retail prices on roasted nuts can yield tenfold returns compared to raw purchases. "Roasters pay around $500 per ton for unshelled cashews but sell them for $20,000 to $40,000 per ton," Simons explained.

One person addressing this issue is Mildred Akotia, CEO of Akwaaba Fine Foods, which processes only 25 tons of cashew annually. She attributes limited local processing to high interest rates on loans, with local banks charging around 30%. “We can’t afford that on our margins,” Akotia said, emphasizing that these economic hurdles hinder her company and others from scaling their operations effectively.

Notably, a significant portion of Ghana's cashews—over 80%—are exported unprocessed, generating around $300 million in revenue. This economy deprives the country of the higher earnings associated with prepared cashew products, resulting in Ghana importing back roasted cashews that have undergone lengthy supply chains.

In 2016, a government initiative to ban raw cashew exports was enacted to promote local processing, but backlash from farmers quickly led to its reversal, highlighting the struggle between the need for regulation and the realities facing producers. More recently, proposals have emerged to implement tariffs on raw cashew exports, although experts like Simons warn that businesses need to adapt and brand their products to improve local consumption before considering government interventions.

Economist Prof. Daron Acemoglu echoes this sentiment, advocating for a focus on building international market access for processed Ghanian cashews. He stresses the significance of education, infrastructure improvement, and reducing corruption as vital steps toward strengthening the industry.

Despite these challenges, Akotia remains optimistic about her business future. She intends to enhance her logistics capabilities to directly process cashews at the farms and further her branding initiatives. “Currently, we can’t meet demand,” Akotia noted. “There’s a ready market both locally and internationally, and I'm determined to elevate Ghanaian processed foods.” As farmers and entrepreneurs push for change, the hope is that Ghana's cashew industry can transform its fortunes from reliance on raw exports to robust local processing and consumption.