Nigeria suffers rejection of 37,000 cashews by Vietnamese buyers

Nigeria is known for its agricultural and oil sector, data from the National Bureau of Statistics (NBS) indicate that cashew nuts have topped sesame seeds to become the leading agricultural export product (and fourth leading export product) in Nigeria for the second quarter of 2018.   

The drive to produce her non-oil export has suffered a severe setback when her 37,000 tons of cashew were rejected because of high price of commodity.

The Deputy Executive Secretary, Federation of Agricultural Commodity Associations of Nigeria (FACAN), Mr. Peter Bakare, who made this known, said the price volatility was due to lack of conducive business environment.

According to him, this made the price of raw cashew from Nigeria to be higher than the price of the finished products in the international market. A look at the report in 2017, when cashew nuts exports dropped from N13.5 billion to N3 billion in the same quarter of the year.

The banks in Vietnam that usually provide the loans to their buyers for purchase complained that the prices of the finished products are less than the price of raw materials.

“The Vietnam financial institutions, therefore, backed out of the business, stressing that it is not a profitable venture for its farmers, so the produce are stuck in Vietnam now,’’ he said.

Bakare said over 67,000 tonnes of cashew were also still lying in the warehouse in Nigeria.

  • Get the scoops and market intelligence that can help
    you make better investment decisions right in your
    mailbox.

The President, FACAN, Dr Victor Iyama, disclosed The Federation of Agricultural Commodity Associations of Nigeria has heaped the blame for the rejection of 37,000 tonnes of Nigerian cashew by Vietnamese buyers, on Nigerian and foreign produce merchants, who engage in speculative buying in the Nigerian produce market.

On what next for the exporters, Iyama responded that the expectation was towards the next cashew season which would be February.

He said, “I am advocating that more of our cashew should be processed and consumed locally. Also, we should sell more of the processed ones instead of raw cashew.”

He pointed out that cashew was not on the terminal market, and so the price was subject to negotiation.

On the estimated loss to the operators, Iyama said it could not be determined yet, adding that in the new season, it would be possible to assess what was sold and leftover, as well as the profit and the losses.

Share this...
Share:

Author: see naija

Leave a Reply

Your email address will not be published. Required fields are marked *