Five Ivorian Cashew processing companies have gone bankrupt and closed their factories in the last two years, while four others are in difficulties and have substantially reduced their activities due to Asian exporters who buy up all the local supplies.
Previously, Ivorian cashew processors claimed they needed more government support and protection from competition from well-heeled Asian buyers, who pay higher prices to control the supply of raw cashew nuts.
Ivory Coast, the world’s top cocoa producer, produces approximately 1 million tons of cashews a year and seeks to process half of it locally by 2025. Only 100,000 tonnes of cashews are processed within the country annually, while Ivorian-owned companies will produce less than 25,000 tonnes.
For every kilogram of processed cashews they export, the government offers companies a bonus payment of 400 CFA francs, but it has not been enough to keep them in business.
TNT, a Vietnamese processor, declined to comment as an independent buyer who worked for TNT, said it was more cost-effective to export raw nuts and produce them in Asia because of the high price of power and labour in Ivory Coast.
CASA, one of the most promising in the Ivorian capitals, declared bankruptcy in November, citing the hiring of 1,200 people.
Citing a general lack of interest in the sector, Hussain Gilani, manager of the CASA plant said the company closed because of technical difficulties.
Ivorian processors are urging the CCA, the cashew marketing board, to develop a system of prior sales for Ivorian companies and stabilise the pricing, to solve the supply problem.
The CCA declined to comment, but an internal source outside of the firm stated that it is working to find solutions to these problems.