SMEs digest: Mkinga gets Sh400 million factory for processing cashew nuts

Mkinga, Tanga. A small scale cashew nut semi-processing factory has been established here as the country seeks to up its capacity to process the delicious snacks.

Tanzania Agricultural Development Bank (TADB) is financing the project - located at Mkinga District, Tanga Region – to the tune of Sh420 million.

The project will be implemented in phases, with the other one [phase] being financing cashew farmers with farm inputs to raise their productive capacities.

Speaking during the launch of a project known as ‘Innovating Cashew Value Chain by Care Tanzania in Tanga, TADB’s manager for the eastern zone, Mr Jeremiah Mhada said that the bank has approved a loan of Sh420 million for the project.

The money will finance the buying of processing machines, civil works for factory buildings and utilities as well as working capital for cashew nut purchase for Outgrowers Kilimo Industry Sigaya Limited.

“TADB has financed the company, Out Growers Kilimo Industry Sigaya Limited, to enhance value addition of cashew nuts and we hope this will increase incomes of cashew farmers in Mkinga District,” he said.

He said TADB’s role was that of catalysing development of the agriculture sector and turning smallholder farming into a formidable agri-business practice.

It also helps to link farmers with the market whereby in this case, he said, they will be linked to the market through their Agricultural Marketing and Cooperative Society (Amcos).

Cashew processing allows development of cashew by-products which increases cashew value.

Available data shows that the liquid inside the cashew shell when processed provides about 15 percent of oils which is medicinal and for industrial uses.

Currently, India and Brazil earns millions of dollars each year by exporting cashew nut shell liquid is sold to the European Union, United States, Japan and Republic of Korea.

“We at TADB hope to stimulate increased productivity and we have so far injected Sh33 billion into the value chain,” said Mhada.

The leaders at Duga Amcos say the investment has what it takes raise the profile of the crop at Mkinga District and Tanga Region as a whole.

“As Amcos leaders we are happy with this investment. The investors have come all the way from Denmark to invest in our country and yet thought of a model that will enable local farmers get shares of the factory at 45 percent,” said the Duga Amcos chairperson, Mr Hassan Tuwano.

Currently, the group had a total of 200 farmers but that the expectation was that the number would rise to 2,500 cashew farmers in the near future.

Mkinga District Commissioner Col Maulid Surumbu called upon all stakeholders to reflect on their roles in the cashew productivity and define them clearly so that the factory project becomes a reality.

He said the factory has come at the right time when Tanzania was exporting 90 percent of its cashew in raw form.