Tanzania’s cashew nuts firms must innovate to compete in global markets

February 13, 2014

Tanzanian companies have long been viewed as laggards compared to their South Africa and Kenyan counterparts due to their reluctance to venture in markets outside their country. However, that could be about to change in the cashew nuts industry after weak local market demand and trade disputes with foreign firms entering Tanzanian market cut into their bottom lines. Local companies situation reflects a general trend that weak profitability has led to less investment on innovation, expansion, upgrading and left them to multiple vulnerabilities as a result. To safeguard their competitiveness, Tanzania cashew nuts producers have to allocate more resources in developing new products and boosting employees’ loyalty. Seeing such business opportunities, cashew nuts companies in areas like Songea, Singida, Mtwara, Lindi, Tanga, Kisarawe, Bagamoyo and other places should ensure they open their own processing facilities to create a value-added product, and save on shipping costs that has left many farmers with meager profit margins. According to data in my possession, Tanzania is Africa’s fourth largest producer of cashew nuts after Nigeria, the Ivory Coast and Guinea-Bissau and was ranked ninth biggest grower in the world in 2012.

The results would be much more favorable besides creating more profit and it will also helps the local communities that deal in the cash crop. Cashew nut sector employs directly and indirectly thousands of people across Tanzania, with majority of them said to be women who have never had jobs before. By having local processing companies, making profit by empowering local women would be a big plus for country of estimated 47 million people. I strongly believe that community development is best achieved and sustained through the empowerment of people, especially women unlike men who waste all their earnings in alcohol and skirts. Me think environmental and social sustainability in the cashew nuts business will bring success for the companies setting up their processing plants and their employees. Being innovative does not mean having fancy software and automated systems only. For example waste and by-products generated by the production and processing of cashew nuts can be managed optimally. One of the innovation would be fruits being turned into juice and can also be used as fertilizer. Another benefit for innovation for cashew nuts farmers in Tanzania would be for cashew shells to be processed and sold to brick producers as a source of energy in a country that has a chronic shortage.

Contador Harrison