50,000 tons of cashew nuts worth $300 million delayed

Gridlock and inefficiency at the ports of Nigeria’s commercial hub, Lagos, delayed shipment of 50,000 tons of cashew nuts valued at $300 million and is threatening this year’s output as traders are cash-strapped.

The kidney-shaped fruits from last year’s harvest should have been exported by January, according to Tola Fasheru, president of Nigeria Cashew Exporters Association. Instead, they are still in containers on trucks waiting to enter the ports or on wharves, he said.

Roads to Lagos ports are badly congested, with hundreds of lorries queuing to enter the premises and either deliver or pick goods. In addition, inadequate capacity and infrastructure, stifling red tape and corruption are hampering export processes, according to Fasheru.

“There is a palpable lack of synergy among the port operators and this is affecting the business of our members,” he said Thursday by phone from Lagos.

Some members of the cashew association have defaulted on contracts to the extent that foreign buyers are now walking away from them. “They are no longer willing to give us fresh contracts,” said the group’s president.

No Money

The delay is likely to affect the output target of 260,000 tons for the current season, which started in February and will end in July.

“Not one single cashew exporter is in the field now as he is owing on contracts and as a result has no money to operate with,” said Fasheru.

Africa’s sixth largest cashew producer plans to raise its annual production to 500,000 tons by 2023, according to a five-year strategic plan released in 2018 by the National Cashew Association of Nigeria.

The country is the continent’s biggest oil producer and President Muhammadu Buhari’s administration is seeking to reduce dependency on crude and diversify the economy, which contracted in 2016 after oil prices and output crashed. Agriculture is one of the key sectors the government has been trying to boost.

source: Bloomberg