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Cashew nut farmers turn back to brokers
Roasted cashew nuts at a local supermarket. Kenya’s production of raw nuts fell to10,000 tonnes last year, compared to 14,000 metric tonnes three years ago. Photo/FILE
Posted Tuesday, February 9 2010 at 00:00
Middlemen are taking advantage of lax enforcement to buy cashew nuts from farmers despite a government ban on export and a directive that the nuts be bought through the National Cereals and Produce Board (NCPB).
Farmers say they have turned to the middlemen due to what they termed frustration by processors who are purportedly paying them less for the produce, compared to middlemen.
Some processors have also petitioned the government to allow back the middlemen who can buy and supply the product from far-flung areas.
The middlemen are buying a significant portion of the nuts from the farmers amid fears that some of the nuts bought this way could end up in export markets.
Before the export ban, the middlemen collected the nuts from individual farmers and delivered them to the exporters based in Mombasa for shipment.
“There are currently only two processors on the ground buying the nuts, with a significant amount going to the middlemen,” said Mr David Gikaru, Lake Kenyatta Farmers and Cooperative Ltd chairman. The co-operative society buys nuts from Mpeketoni in Lamu, a region known for top quality nuts in the country.
Dried nuts
The co-operative is holding 40 tonnes of dried nuts which it says it cannot dispose of at the going rates of between Sh32 and Sh34 a kilogramme without incurring losses.
It is holding out for a price of Sh38 per kilogramme. Before the ban, farmers were fetching as much as Sh60 per kilogramme of nuts.
But low prices at the start of the season (November to April) which is characterised by low quality nuts and poor farm gate prices are expected to improve once high quality nuts start entering the market later this month.
There are only two processors—the Kenya Nuts and Wonder Nuts buying the produce at the moment.
Equatorial Nut Ltd is expected to set shop in Coast province this week, according to its general manager, Mr Johnson Muhara.
Exporters of raw cashew nuts commanded over 60 per cent of the market before the ban.
Experts say the exporters were able to offer higher prices because of rebates offered by importing countries like China, Hong Kong and India to encourage cashew nut processing and create jobs in those countries.
Most of the exporters have reportedly moved to Mozambique and Tanzania.
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