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How To Write A Business Plan on Establishing a Cashew Plantation in Nigeria

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How To Write A Business Plan on Establishing a Cashew Plantation in Nigeria

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Cashew is a tree crop, a small to medium tree, generally single-trunked and spreading in habit, up to 10-12m in height. In older trees, spread may be greater than height, with lower limbs bending to touch the ground. Leaves are thick, prominently veined, oval to spatulate in shape, with blunt tips and entire margins.

Most cashew trees start bearing fruit in the third or fourth year, and are likely to reach their mature yield by the seventh year if conditions are favorable. The average yield of nuts of a mature tree is in the range of 7-11 kg per annum. Although the cashew tree is capable of living for 50-60 years, most trees produce nuts for about 15-20 years.

Cashew is widely cultivated for its nuts and derived products in the West, East and South Africa and in South Asia, from Sri Lanka to the Philippines. Cashew is mainly grown as a cash crop by farmers across the world. Since it is grown in different habitats through cross-pollination, cashew production varies greatly in terms of crop quality and yield.

Nigeria, having a total area of 100,000ha cashew plantation and an average annual production of 80,000MT contributes almost 16% of the total production of the agro-ecological zone. Its production is 5% of the global situation.

Cashew cultivation is a capital intensive business and requires a experience. The farmer would need help in the follow areas

Land Preparation
Pest and Disease control
Fertilizer Application

In Asia and Africa, more than 80% of the cashew cultivation is done by smallholding farms, ranging in size from 0.5-5 ha. Medium and large-scale commercial plantations amount to 10-15% of the total cashew production. Major cashew nut producing countries are Vietnam, Nigeria, India, Côte d’Ivoire and Benin. In India, cashew is grown in peninsular areas of Kerala, Karnataka, Goa and Maharashtra, Tamil Nadu, Andhra Pradesh, Orissa and West Bengal.

The country is the pioneer in cashew trade and processing in the world. India and Vietnam are the two major producers and exporters of cashew, accounting for 40% and 33% market shares, respectively. Brazil is another major exporter that supplies to the United States.

The largest cashew importers in terms of value are Vietnam, India, and the US. These countries together account for 85% of the total cashew import share, which signifies a concentrated nature of import trends. Other importers of cashew kernel are European Union, China, United Arab Emirates, Japan and Saudi Arabia.

Cashew crop is traded in several forms including cashew kernels, broken and whole, raw cashew nuts, roasted cashew nuts and cashew nut shell liquid. Brazil is currently focusing on trade events through its Agency for Promotion of Exports and Investments (APEX) for the popularity and growth of cashew trade.

Many small African countries like Guinea-Bissau are focusing on supply-chain development and competitive pricing to boost their export demand. However, due to the ongoing supply crunch caused by reduced production in Vietnam and Western Africa, the global cashew prices are expected to escalate in the near future. Shippers of Raw Cashew Nuts (RCN) have defaulted or negotiated new prices with the sellers in India and Vietnam.

On the other hand, the Ivory Coast is in a better condition in terms of production; the exports by the region have slumped due to high taxes and low prices that have forced the farmers to sell their produce in the neighboring countries.

During the last three years, Nigeria has been one of the leading suppliers of raw cashew nuts exported to India. Nearly 18,000 to 23,000MT of raw nuts per annum have been exported earning about N 23 billion annually.

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Business Plans in Nigeria

businessplansinnigeria.ng is a one stop destination for investment and business opportunity seekers in Nigeria. businessplansinnigeria.ng is privately owned and operated by Foraminifera Market Research Limited. We have over nine (9) years experience in conducting and preparing market research report (feasibility reports and business plans) in Nigeria.