The Crisis in Nigeria’s Cashew Industry
The debate around the government’s proposed restriction on raw cashew nut exports has sparked strong reactions across the agricultural sector. This comes after a similar move was made regarding shea butter, and it has ignited a heated discussion about the future of Nigeria’s cashew industry.
One of the most vocal critics is Dr Ojo Ajanaku, President of the National Cashew Association of Nigeria (NCAN), who warned that such restrictions could lead to “premature deaths” among farmers. While this rhetoric may evoke sympathy, it overlooks the deeper issues affecting the sector and diverts attention from the urgent need for structural economic reform.
Nigeria’s cashew industry is not collapsing due to export restrictions. It is failing because of long-term policy neglect, an unregulated market that favors foreign traders over local processors, and the lack of an industrialization strategy that turns agriculture into real wealth creation.
The choice is not between pity and punishment, but between a short-term, sentiment-driven narrative and a long-term, structural economic strategy. If Nigeria is serious about jobs, prosperity, and competitiveness, the truth is clear: cashew farmers do not need pity. They need a functional policy framework.
The Strain on Local Processing
Today, the local cashew processing industry is under extreme pressure. Nigeria has over 150,000 metric tonnes of installed processing capacity across several factories, yet utilization hovers between 10 and 13 percent. Nearly 90 percent of this capacity goes to waste every year.
At the heart of the problem is the inability of local processors to secure a steady supply of raw nuts. International buyers, backed by stronger capital and cheaper credit, are able to purchase nuts at the farm gate and pay cash immediately. Local processors, on the other hand, are forced to borrow at high interest rates from Nigerian banks, making it impossible to compete.
This results in a predictable outcome: nuts are exported raw, factories remain idle, and thousands of potential jobs are lost. Factories that were built to employ over 10,000 workers now operate with skeleton crews, retaining only a fraction of their workforce. Most of these lost jobs would have gone to women and young people in rural communities.
When Julius Berger, a multinational company with technical expertise and advanced facilities, abandoned cashew processing, it was not just a business decision—it was a signal that Nigeria’s cashew economy is broken. If a large, resourceful company could not survive, what hope do smaller Nigerian processors or entrepreneurs have?
Economic Losses and Missed Opportunities
The economics of the situation are stark. Nigeria exports raw cashew nuts at about $1,500 per tonne. If processed into kernels, the global market pays between $3,500 and $8,000 per tonne, depending on grade. By exporting raw, Nigeria forfeits between 100 and 400 percent of potential revenue.
This loss is not abstract; it translates into fewer schools, hospitals, rural roads, and jobs. Worse still, cashew processing is labor-intensive: shelling, peeling, grading, and packaging involve thousands of hands. Every tonne exported raw is not just lost income but lost opportunities for local employment, skills, and industrial learning.
Each container shipped to Vietnam or India represents a container of jobs that could have been created in Nigeria. And the opportunity goes beyond kernels. Cashew is a multipurpose crop with more than 20 commercially viable by-products, including Cashew Nut Shell Liquid (CNSL), which is used in paints, varnishes, resins, and advanced polymers. Cashew apples can be processed into juice, ethanol, animal feed, and even biofuels. Yet Nigeria has barely scratched the surface.
Lessons from Global Examples
Global examples show that success in cashew is not built on pity but on deliberate policy. Tanzania, for instance, imposed export restrictions in 2018 and again in 2022. Controversial at first, the results were transformative: farmers received fair prices, processors had reliable access to raw materials, and national output more than doubled—from 232,681 metric tonnes in 2022 to over 500,000 tonnes in 2025, with a target of 700,000 in 2026.
India’s dominance in cashew is no accident either. For decades, it imposed tariffs, subsidized processors, and offered technical support. Today, it is the world’s largest consumer and among the top exporters of kernels. Ironically, India now imports raw nuts from Africa, processes them, and sells finished products back to the world at a premium.
Vietnam’s rise is even more striking. In the 1990s, it was a minor player. Through targeted government intervention, technology investment, and private sector collaboration, it became the world’s leading cashew exporter. It achieved this not by allowing uncontrolled raw exports, but by creating a structured system where both farmers and processors thrived.
A Path Forward for Nigeria
Against this backdrop, NCAN’s claim that farmers will “die prematurely” if exports are restricted rings hollow. Farmers are not condemned by local processing. On the contrary, they stand to gain from stable farm-gate prices, guaranteed demand, and reduced dependence on volatile international buyers.
The real premature death we should fear is that of Nigeria’s factories, industrial jobs, technology transfer, and ultimately, a viable future for the country’s youth. What Nigeria needs is not a reckless blanket ban, but a phased, structured, and inclusive policy that balances the interests of farmers, processors, and traders while putting the national economy first.
A workable framework could involve a quota system where about 200,000 metric tonnes of raw nuts are reserved annually for certified local processors. The balance could then be sold to international buyers through a regulated auction system. Proceeds from levies and permits should be reinvested in farmer cooperatives, extension services, research, and rural infrastructure.
Smallholder farmers, who make up over 90 percent of producers, must be empowered with improved seedlings, access to credit, and fair pricing benchmarks. Local processors must be supported not only with guaranteed supply but also with tax incentives, affordable loans, and critical infrastructure such as stable electricity and efficient logistics.
Nigeria must also position its cashew brand globally. This requires enforcing strict quality standards, certification, packaging, and aggressive marketing. It also requires innovation. The future of cashew lies not only in kernels but also in by-products like CNSL, juices, and cashew-based foods that can compete on international shelves.
NCAN itself must evolve from a defensive lobby into a development-focused institution, leading afforestation drives, building seed centers, creating farmer databases, and partnering with processors to push output beyond one million tonnes annually.
The Bigger Picture
Cashew is not just another crop. It is a test of Nigeria’s seriousness about industrialization. For decades, the country has repeated the same mistake: exporting cocoa, cotton, groundnuts, and crude oil raw, while importing finished goods at a premium. This cycle keeps Nigerians poor while enriching processors abroad.
The cashew debate is therefore much bigger than one commodity. It is about whether Nigeria will remain a raw-material supplier or finally take control by processing, manufacturing, and creating wealth at home.
The emotional warnings about premature deaths for farmers miss the deeper truth. Farmers do not die because their crops are processed locally. They die economically when their produce is undervalued, when it is sold raw at low prices, and when their children are denied opportunities because industries that should have grown around their farms were exported abroad.
The choice before Nigeria is stark: remain stuck in a low-value, job-exporting past, or embrace a high-value, job-creating future.
The proposed policy on raw cashew exports, if carefully designed, is not a death sentence. It is a lifeline, a chance to rescue a critical agro-industrial sector, create thousands of jobs, and align with a broader vision of prosperity.
The time for pity is over. The time for policy is now.
