Mozambique’s cashew nuts output is expected to decline by a third in 2020 compared to last year, an association representing processors said on Tuesday.The Association of Cashew Industrialists said in a statement that cashew processing this year “will not reach 35,000 tonnes compared to around 52,000 tonnes processed last year.”
“This drop reflects the impact of a negative marketing trend in recent years, with the national industry having been processing less and less cashew since 2017,” it said.
It revealed that over 60,000 tonnes of cashew nuts were processed in 2018.
It attributed the decline in output to “the particularly adverse context in which the nation’s industrialists are operating.”
The adverse operating environment includes stiff competition from international players such as India and Vietnam where local producers receive subsidies from their governments.
The association argued that as a result the Asian processors have an advantage over Mozambican players since they are able to buy raw materials in Mozambique at “unfair” prices that distort the market at the expense of the local industry.
It revealed that this year’s harvesting and marketing effort has also been affected by the Covid-19 pandemic, which has resulted in a significant drop in the harvest and a decline in the price of cashew nuts by more than 15 percent over the past few month.