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CHAPTER 1 - INTRODUCTION

The cashew tree, native to Brazil, was introduced to Mozambique and then India in the sixteenth century by the Portuguese, as a means of controlling coastal erosion. It was spread within these countries with the aid of elephants that ate the bright cashew fruit along with the attached nut. The nut was too hard to digest and was later expelled with the droppings. It was not until the nineteenth century that plantations were developed and the tree then spread to a number of other countries in Africa, Asia and Latin America.

Cashew processing, using manual techniques, was started in India in the first half of the twentieth century. It was exported from there to the wealthy western markets, particularly the United States. In the 1960s, some of the producing countries in East Africa began to process nuts domestically rather than sending them to India for processing. This allowed them to benefit from the sale of both processed nuts and the extracted cashew nut shell liquid.

1.1 The importance of cashew

Cashew is held with great esteem in many customs and cultures. Its value can be estimated from a question that appeared on the household census in Mozambique that asked whether the house owned any cashew trees.

Cashew is known by many names. In Mozambique, the Maconde tribe refer to it as the 'Devil's Nut'. It is offered at wedding ceremonies as a token of fertility and is considered by many to have aphrodisiac properties. The cashew tree and its products are known by the following names in other parts of the world:

Portuguese caju, cajueiro, pe de caju, castanha de caju, maca de caju
French cajou, acajou, ancardier, noix de cajou, pomme de cajou, amande de cajou
English cashew, cashew tree, cashew nut, cashew apple, cashew kernel
Spanish maranon, nuez de maranon
Hindi cadju
Sinhalese cadju
Italian anacardio, noce d'anacardio, mandorlad'anacardio
Dutch acajou, kashu
German acajuban, kashunuss
Swahili mkanju, korosho
Somali bibbo, bibs
Indonesian jambu mente, jambu mete

Source: Andrighetti et al, (1989).

With world production in 2000 at about 2 million tonnes of nuts-in-shell and an estimated value in excess of US$2 billion, the cashew industry ranks third in the world production of edible nuts. India and Brazil are the major cashew exporters, with 60 percent and 31 percent respectively of world market share. The major importers are the United States (55 percent), the Netherlands (ten percent), Germany (seven percent, Japan (five percent) and the United Kingdom (five percent).

Cashew kernels are ranked as either the second or third most expensive nut traded in the United States. Macadamia nuts are priced higher and pecan nuts can be, if the harvest is poor. Cashew nuts have a well established market in the United States with a great variety of uses. Retail prices range from about US$4-11 per pound (US$9-23 per kg) depending on the size of nut and the packaging.

The extensive market connections of exporters from Brazil and India make it difficult for the smaller exporters to make gains in the United States market. Importers may appreciate the low prices offered by small suppliers, but the lack of reliability in quality tends to make them favour the larger, more reputable suppliers (The Clipper, 1994).


1.2 Cashew products

Three main cashew products are traded on the international market - raw nuts, cashew kernels and cashew nut shell liquid (CNSL). A fourth product - the cashew apple is generally processed and consumed locally.

The raw cashew nut is the main commercial product of the cashew tree, though yields of the cashew apple are eight to ten times the weight of the raw nuts. Raw nuts are either exported or processed prior to export. Processing of the raw nuts releases the by-product CNSL that has industrial and medicinal applications. The skin of the nut is high in tannins and can be recovered and used in the tanning of hides. The fruit of the cashew tree that surrounds the kernel can be made into a juice with a high vitamin C content and fermented to give a high proof spirit.


1.2.1 Cashew kernels

It is estimated that 60 percent of cashew kernels are consumed in the form of snacks while the remaining 40 percent are included in confectionery. The cashew competes in the same market as other edible nuts including almonds, hazels, walnuts, pecans, macadamias, pistachios and peanuts. There has recently been a considerable rise in demand for edible nuts by consumers interested in quality and health aspects of food. The breakfast cereal, health food, salads and baked goods markets are all expanding markets for cashew nuts.

One major factor that affects the consumption of cashew kernels in world markets is competition from other tree nuts. The major importers in developed countries contract their requirement for the whole year based on the sales from previous years. If prices of a commodity fluctuate over a wide range, they will not want to trade in that item for fear of incurring heavy losses. Since cashew cultivation is not organised on a plantation scale in most producing countries, year to year variation in crop yield is a regular feature resulting in wide price fluctuations for cashew kernels. On the other hand, almonds and pistachios are grown in very large plantations in the United States and thus their prices are steady year after year (Nayar, 1995).


1.2.2 Cashew nut shell liquid

Cashew nut processing allows for the development of an important by-product which can increase its added value. The liquid inside the shell (CNSL) represents 15 percent of the gross weight and has some attractive possible medicinal and industrial uses. CNSL is one of the few natural resins that is highly heat resistant and is used in braking systems and in paint manufacture. It contains a compound known as anacardium, which is used to treat dermatological disorders. The main markets for CNSL are the United States, the European Union (mainly the United Kingdom), Japan and the Republic of Korea. Together these account for over ninety percent of world trade, most of which is supplied by India and Brazil.


1.3 Processing

Traditionally the various processing operations were performed manually by experienced semi-skilled workers. This is still the case in India, which is the world's largest producer of cashew kernels. Since the 1960s, various mechanised pieces of equipment have been developed and are available in several countries. The processes that have been mechanised are roasting, cashew nut shell liquid extraction and shelling. For the most part, the cleaning of raw materials and sizing and kernel grading have remained labour intensive manual operations.

There are significant differences in investment requirements, labour skills, health requirements and levels of efficiency between the Indian manual technology and the medium to large-scale mechanical and semi-mechanical operations. In general the Indian processing system involves lower investment and variable costs and achieves far greater efficiency in terms of kernel material yield and the proportion of whole kernels extracted. However this system requires large numbers of experienced workers who work at unhealthy levels of exposure to CNSL. The mechanised systems are more vulnerable to breakdown due to shortage of spare parts, require large volumes of nuts for efficient operation and operate well below manufacture specifications when strict grading and sizing activities are not in place prior to shelling (Jaffee and Morton, 1995).


1.4 Opportunities for small-scale processors

Cashew processing is a very competitive but also a potentially lucrative activity that can and should be exploited by more small-scale processors. African countries that are in the process of re-building their local cashew processing industry would be well advised to follow the Indian example of small scale, mainly manual processing operations.

There are several good reasons why small-scale producers and processors should get involved in cashew processing, including the following:

Thus cashew has the potential to increase the incomes of poor producers, to create employment opportunities during harvesting and processing, and to increase exports.

However, as with all small-scale processing operations, cashew processing is not without risk or problems. In order for the small-scale processor to succeed, there are certain constraints which also need to be considered:

These constraints are not, however, insurmountable. With good committed support from local governments, introduction of policies that favour rather than hinder the small-scale entrepreneur and back-up from relevant development organisations, cashew processing can be an attractive and viable option for the small-scale processor.


1.5 The way ahead

Small-scale producers and processors need to establish more direct relationships with the European food industry, which packs and markets cashew nuts. At the moment, the world purchasing circuits are dominated by middlemen - brokers and wholesalers - who control prices, quality requirements and the volumes sold (Partnership, 1995). Development organisations can be instrumental in bridging the gap between the small-scale processor and the buyer, thus helping the former to succeed. They can offer a range of support services, including the following:

One area that deserves special attention is the development of value added products for export. Most exports are in the form of plain kernels in bulk, which are imported by large wholesalers in the consuming countries. These are then re-packaged, either as they are, or after roasting and salting, and sold to retailers. Opportunities exist for processors to penetrate these markets, however, they are fraught with difficulties, such as pricing and competition from existing products. The key to opening up new markets or expanding the existing ones is to supply the best quality products at competitive and steady prices. Particular attention to providing goods of consistently high quality is vital and cannot be over-stressed. This requires inputs from various stakeholders in the food processing chain and is a service that can be provided by government and non government organisations interested in supporting the small-scale food processor.

This bulletin gives a general overview of cashew production, with a detailed section on cashew processing. It is suitable for smallholder farmers, small-scale processors and development professionals who wish to support development of the cashew processing sector. Considerable emphasis is placed on processing operations, particularly for the small and medium-scale processor. This bulletin also contains a comprehensive list of organisations and resource persons involved in cashew processing and a selection of suppliers and manufacturers of cashew processing equipment. The bibliography section contains an assortment of relevant literature that the reader should find interesting and useful.

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