Enterprise reporter, ORIONEWS Information

The Accra road vendor appears at me, bemused.
I am making an attempt to determine how the slightly flimsy 30g bag of roasted cashew nuts she’s promoting, beside a sweltering freeway in Ghana’s capital, prices me the equal of about 75 cents (60p).
That is clearly not some huge cash for me, a customer from the UK, however I am amazed on the mark up.
The worth is at the least 4,000% increased than the price of shopping for the identical weight of uncooked, unshelled cashews from a Ghanian farmer.
“It is unimaginable,” I protest. But she does not perceive my English, or my reasoning.
The worth of the nuts was, in spite of everything, printed on the packet. And explaining why I assumed it was past the pale was by no means going to be straightforward.
Ghana is the world’s third-biggest exporter of unprocessed cashew nuts, behind Ivory Coast in first place, and Cambodia in second.
To supply the crop, round 300,000 Ghanaians make at the least a part of their residing rising cashews.
Nashiru Seydou, whose household have a farm within the nation’s north-east, some 500 miles (800km) from Accra, is one in all them.
He says the work is tough, and unreliable provide chains and risky wholesale costs make survival tough.
“We’re struggling. We will use the daylight, the fertile land, to create extra jobs,” he says. “I would be pleased if the federal government involves our assist and helps help our business.”
He tells me that he at present will get round $50 for a big 100kg sack of unshelled cashews.

“It is wonderful,” says Vibrant Simons, an entrepreneur and financial commentator in Accra, who has studied the numbers. “Roasters and retailers purchase the nuts from farmers for $500 a tonne, and promote to clients [both at home and abroad] for quantities between $20,000 and $40,000 a tonne.”
As a complete, Ghana grows about 180,000 tonnes of cashews yearly. Greater than 80% is exported, and in uncooked, unshelled type. This generates some $300m in export revenues, however implies that Ghana misses out on the considerably increased returns you get from roasted, ready-to-eat cashews.
Mildred Akotia is one individual making an attempt to extend the quantity of cashews which might be shelled and roasted in Ghana. She is the founder and CEO of Akwaaba Positive Meals, which at present processes simply 25 tonnes a yr.
Ms Akotia denies any suggestion that she and others like her are price-gouging. The packaging and roasting equipment a western enterprise would robotically use on this business, she says, is out of attain for her due to the excessive price of credit score in Ghana.
“When you go to an area financial institution, it should price you 30% curiosity to get a mortgage,” she complains. “As a producer you inform me how massive your margins are that you would be able to afford that sort of curiosity? We have needed to depend on what we will get: mushy loans from relations and grants from donor companies.”
She says that this case is why lower than 20% of Ghana’s cashews are processed regionally. The majority are scooped up and exported to large factories in nations like India, Thailand and Vietnam.
Remarkably, a few of these packaged nuts are then exported again to Ghana, the place they’re offered for a similar value as domestically roasted cashews. That is regardless of the 20,000-mile sea freight spherical journey, and import prices.
It’s a related image for rice, which is exported to Ghana from Asia and offered at low costs, regardless of Ghana additionally rising the crop itself.

Again in 2016 the Ghanaian authorities experimented with an export ban on uncooked cashews with a view to encourage homegrown processing. Nonetheless the coverage needed to be deserted inside a few weeks after uproar from farmers and merchants.
With out obtainable low cost loans, it wasn’t potential for ample new Ghanaian roasters to enter the market. So the value of uncooked nuts crashed, and plenty of began rotting for need of a purchaser.
Extra just lately there was speak of elevated tariffs on uncooked cashew exports and bans on exporters buying cashews instantly from farms.
However all these coverage interventions miss a key level, in accordance with Mr Simons. An enormous problem for native producers, he says, is to work more durable on the fundamentals of doing enterprise, and rising their firms.
“To be able to be environment friendly at this, you want scale,” he says, including that companies want to advertise consuming cashews to make it extra widespread within the nation. “You want a number of a Ghanaians consuming the nuts, not only a small center class”.
Prof Daron Acemoglu, a Turkish-American economist, agrees that constructing a powerful native market is vital for Ghana’s cashew business. He was one in all final yr’s winners of the Nobel Memorial Prize in Financial Sciences, for his work on the struggles going through low-income economies, and specifically their home-grown companies.
But he says that the primary precedence ought to be bettering entry to worldwide markets for processed Ghanaian cashews.
“These companies are coping with workforces that are not correctly expert, they’ve infrastructures that are not working, they’re always in concern of corrupt officers, or rule adjustments, and likewise it’s extremely tough to succeed in international markets, he says. “They want the international market as a result of the home market is small, and their very own authorities has little or no capability [to boost it].”
He additionally needs to see the Ghanaian authorities enhance the community of roads and railways to ease the price of transportation.

However Mr Simons reckons the onus ought to now be on Ghanaian companies themselves, to do the fundamentals to reinforce the branding and advertising and marketing of cashews. As it’s, he says, most of the nation’s most enterprising enterprise persons are simply leaving Ghana for higher paid alternatives overseas due to the purple tape and cronyism in Ghana are so prohibitive.
“There is a huge mind drain,” he says. “My idea of why Africa’s financial growth has been gradual is as a result of we focus an excessive amount of on the availability facet, however the true magnificence is in demand, making a consuming class of cashew-eating lovers, and you do not have an entrepreneurial class that may create demand transformation.”
He says the identical argument applies to Ghana’s different larger exports, like gold and chocolate, neither of which will get a lot value-addition inside Ghana earlier than getting exported to the West.
Mildred Akotia hopes she could be a type of entrepreneurs to buck the development. She now needs to construct her personal logistics arm, to have the ability to course of the cashews direct from the farm gate.
“I’ve a number of calls from the UAE, from Canada and America. At present we will not meet demand. We will not get sufficient kernels to roast.
“There is a prepared market each regionally and internationally. My branding is sweet, my advertising and marketing is sweet. My dream is to provide a facelift to Ghanaian processed meals.”