Mtwara. The 2019 cashew nut trading season kicks off on Tuesday amid fears and optimism what the money-making industry will bring this time after experiencing the worst turbulences last season.
The government said on Monday everything was in place for the new season.
It has directed Agricultural Marketing Co-operative Societies (Amcos) to start collecting the crop from individual farmers and cooperative unions and subsequently hold auctions.
Deputy Agriculture minister Omary Mgumba announced the start of the cashew trading season on Monday during a meeting of cashew stakeholders held in Mtwara.
Stakeholders had expressed concern during the meeting that the October 30th date set for the first auction came too late and would seriously affect the trading season.
Experience has shown Tanzania cashews attracted better prices before Christmas and buyers tend to shift to other markets after end- of-the- year festivals.
“Auctions should have started as early as October 15 instead of October 30, 2019 as announced by the Cashewnut Board of Tanzania (CBT),” says the chairman of the Coast Cooperative Union (Corecu), Rajabu Ng’onoma.
Similar views were echoed by another farmer January Mohammed who said the auctioning time should be set to protect farmers from declining prices after Christmas.
But the deputy minister insisted that the October 30 was set to pave the way for creation of enough storage space because warehouses were still full of cashews produced during the 2018/19 season.”
“My recent visit to Tandahimba established that there were empty warehouses with a storage capacity of 10,000 tonnes and the construction of another warehouse with the capacity of 1,700 tonnes cashews was being completed,” he said.
CBT said the 2019/20 trading season will last for nine weeks.
The official schedule shows the first auction by Corecu would take place on October 30, followed by the Tunduru Agricultural Marketing Cooperative Union (Tamcu) the next day.
Tandahimba and Newala Cooperative Union (Tanecu) and the Masasi and Mtwara Cooperative Union (Mamcu) on November 1, this year.
“Lindi Mwambao, Ruangwa Nachingwea and Liwale Cooperative Union (Runali) and Tanga Cashews Cooperative Union (Tacacu) will hold theirs on November 2 and November 3, respectively,” according to CBT.
The cooperatives will conduct other auctions within the nine weeks.
CBT acting director general Francis Alfred said preparations for the seasons included accessibility of packaging materials, licensing of storage facilities and auction warehouses.
Other areas include quality control of Raw Cashew Nuts (RCN), licensed buyers, sales proceedings during auctions, payment procedures, levies imposed on farmers and logistics.
Mr Alfred said a total of 4,040, 000 sacks were required for this season and already one million sacks were available.
“The Tanzania Co-operatives Development Commission (TCDC), therefore, has ordered importation of the remaining 3,040,000 sacks through the Dirma Holdings Company and Namanyolo Investment Limited and that they were expected to arrive in the country mid October,” he said.
Storage and auctioning warehouses
According to the CBT boss, a total of 25 warehouses with a storage capacity of 208,526 tonnes have been licensed for storage and auctioning of raw cashew nut.
He said the five warehouses located in Lindi can accommodate 59,602 tonnes, those in Mtwara (120,790 tonnes), Ruvuma (16,602) tonnes while the Coast Region warehouses stores (11,529 tonnes).
Quality control of RCN
The CBT boss said the board was training warehouse supervisors, buyers, processing companies and extension officers in cashew growing regions on quality control.
He said Amcos and cooperative unions have been directed to purchase moisture meters and start using them in the 2020/21 season to improve quality control from the grassroots level.
According to him, farmers will this season be required to collect cashews and properly grade them before submitting to Amcos responsible for inspections, grading and ensuring they are free from impurities.
The warehouse supervisors will be responsible for storage of cashews in grades.
Buyers who will participate in the 2019/20 season are supposed to be registered by CBT through the Agricultural Trade Management Information System (ATMIS). He said buyers are also required to make bid security deposits varying from Sh20 million for 50 to 100 tonnes and exceeding Sh1 billion for cashews above 3001 tonnes.
This time buyers will be required to submit sealed bids at the offices of district and regional commissioners one day before auctions.
“The opening of the bids will be done in a transparent way under the supervision of cooperative unions. Sales invoices will be issued within 24 hours,” he said.
Payments to cashew farmers
Mr Alfred said payments will be made to farmers through respective bank accounts after buyers have paid for procured bulk after payments of agreed levies have been made.
He said Amcos will be responsible for preparing a list of farmers and respective bank accounts and submiting the list to respective banks for verifications before handing it over to cooperative unions.
According to him, the buyers are required to deposit money for sold cashews into a settlement account owned by a cooperative union four days after cashews have been sold and that all legitimate levies will be deducted before the money has been transferred to different Amcos.
Imposed levies for 2019/20 season
He said during the 2019/20 season, Sh70 will be deducted from every kilo of cashew for development of cooperatives, including supervising the collection of cashews from farmers, leasing warehouses, security to mention but a few.
He said an estimated amount will be charged per kilometre for transportation of cashews from Amcos to main warehouses and that councils will receive Sh56.52 per kilo in cashew levies at the farmgate prices.
Also, he said Sh25 will be deducted from every kilo of cashews to facilitate the crop’s research by the Naliendele Agricultural Research Institute (Nari) and enable CBT to import inputs, supervision of seedlings production, conduct cashews capacity building trainings as well as protecting the quality of the produce.
Levies charged to buyers
Mr Alfred said buyers will be charged Sh56.52 per kilo they sell in expenses for sacks and ropes imported for cashew storage.
“According to the Warehouses Receipt Regulatory Board (WRRB), the buyers will also be charged Sh38 per kilo for the storage of the produce at the auction warehouses,” he said.
The buyers will be responsible for maintaining the quality of the produce inside and outside the country and that Procedure Delivery Note (PDN) permit issued by CBT will be responsible for transportation of cashews inside the country.