The Transformation of the

Ghanaian Cashew Processing

Industry

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Presented by: Rowell Kutie Weyori

December 2009

Order of Presentation

• General Overview of Processing Industry

• ACi Support

• Financing• Financing

• Other Initiatives

• Plan for 2010

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General OverviewGhana is relatively small cashew producer but offers good conditions for cashew processing

Doing BusinessCashew Industry•Cashew Farmers : 35,000

•Hectares under cultivation : 72,000

•Yearly Production : 27,000 tons

•Average Farm size : 0.8 - 2.5 ha

•Easy start up, freezone facility, tax holidays.

•Favorable labour policy

•Better Infrastructure, water,electricity, roads, port, etc.

•Average Yield : 2-3 kg/tree

•Productivity/ha : 250 kg/ha

•Farm Gate price : $350/ton

•Value Raw nuts : $11m

•Value processed Nuts : $19m

•Local Processing : 2%

•Yearly exports : 55 - 70000 tons

•Good management people

•Workers are Hard workingthough expectation levelsare high.

•Finance for Working Capital is not easy even at high interest rates

•Raw nut quality is good tosupport profitable processing

Cashew Processing at a glance ….

Mim Cashews

Goaso Municipality

1500 tons/year

530 acres plantation

Cashew apple brandy

Workers training

Expansion

Quality Control

Kona Agro Processing

Wenchi

1000 tons/year Financing

Management

Complete TA

West African Market

Link

Techman

Project in pipeline

(5000tons/year)

N/A

Processor Potential Bottle Neck

Cashfoods Ltd.

Drobo

750 tons/year Financing

Management

Complete TA

Winker Investments

Lda.

Afeinha (Volta region)

150 tons/year

Local market oriented

Expansion

Financing

Complete TA

Muskaan Ghana

Limited

A new investor

1000 tons capacity

plant in Nsawkaw

New kick off

Financing

Complete TA

Bole , Sampa, Kabile,

Nsawkaw (4 small

plants)

100 tons/year each

Local Market oriented

Expansion

Financing

Complete TA

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Facility

LocationPlantation

Processing

Plant Apple Plant

ACi is Providing Technical assistance for three existing plant,

Expansion for 2 existing plant and one new in pipeline

• Technical assistance to MIM Cashew & Agri products Ltd. and Winker Investments Limited: Systems to control production loss and traceability tools are in progress. Technology up-grading and training on quality.

• Financing for Kona Agro Processing, installation of machinery for 2010

• Discussions on MOU for CRIG processing plant at Bole: Complete Technical Assistance will be given by 2010, February.

• Expansion plans for Mim, Winker, CRIG - Bole and Kona Agro processing.

• One New client is receiving base line assistance to kick off a plant in 2010. (Muskaan Ghana Limited, Nsawkaw)• Business Plans• Layout designs• Environmental and social Impact study

• One potential client is in the pipeline.

Financing is a critical issue in revitalizing old closed processing

plants as well as for new start ups. Banks and financial

institutions are not prepared for financing cashew sector

• Introduced cashew processing to the banks as banks have hardly any experience of it: some banks show a positive response, a step forward to help cashew processors.

• Various introductory meetings with many banks, ADB, Ecobank, • Various introductory meetings with many banks, ADB, Ecobank, Amal Bank: Root Capital has assisted in visits to some processors.

• Ecobank and Root Capital is working on some proposals. Other banks are still reluctant to finance cashew processing.

• New processors are also motivated and investing a good part of investments from their pockets.

Creating a Direct Linkage between farmer groups and

Processors and introducing tools to measure for premium

payments

• Work with FMS and GTZ to introduce farmer associations, groups, cooperatives to processors.

Other Initiatives

cooperatives to processors.• Training program for these farmer groups in evaluation of their

product quality, post harvest handlings.• Set up tools for processors as well as for farmer associations on

premium base. (Mutually agreed by farmers as well as processors)• Creating one brand for processors to export

Plan for 2010, Next steps..

• Continuous Technical assistance to MIM, Winker in their expansion phase

• Trainings for future managers, supervisors and workers, Academic and hands on approach on cashew processing and controls

• Installation and Commissioning on equipment for 2010 processors, maintenance schedule for equipment

• Assist Kick off processing for 2010 processors, install all control systems in placesystems in place

• Quality control at each stage of process, Hygiene and workers health

• Assessment of certification need and preparation for certification• Farmer linkage with the processors, introducing tools to measure

premiums.• New client search and set up.• Holding company base line as services provider as AIA in

Mozambique, address brand needs

Thank You

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