Success Story
Cashew Nut Purchasing Network: Improving Incomes and Smallholder Farmer Guarantees
The cashew industry is expanding rapidly in Côte d’Ivoire, one of the world’s top cashew producing countries, however its potential for quality production, processing and domestic and export trade has yet to be fully realized. To help farmers receive a quality-based price increase on cashew sales, Sonata Côte d’Ivoire (CI) formerly known as Huxley Cote d’Ivoire—a company specialized in the processing and export of raw cashew nut (RCN)—is partnering with the USDA West Africa PRO-Cashew Project. Implemented by Cultivating New Frontiers in Agriculture (CNFA), PRO-Cashew aims to increase the incomes of farmers in the West African cashew sector by improving crop quality, supporting value chain linkages between farmers and agribusinesses and strengthening efficiency and quality in production and trade.
As part of the PRO-Cashew Agricultural Extension Grant program to establish stronger supply chain linkages between producers and processors, Sonata CI was selected to receive a three-year $200,000 grant to invest in a Supply Chain Program to offer training on good agricultural practices and post-harvest handling to more than 10,000 cashew producers.
At the start of the 2020/2021 cashew season, PRO-Cashew supported Sonata CI to train 30 Lead Farmers and Sonata CI staff on good agricultural practices. These Lead Farmers then trained an additional 2,581 producers across five regions where the company’s collection centers are located. Supported by PRO-Cashew, Sonata CI also facilitated the organization of cashew producer groups in each locality, establishing a high-quality RCN supply network. By offering competitive prices to farmers and supporting quality production through training, Sonata CI is improving agricultural practices and incomes for cashew producers across Côte d’Ivoire and helping farmers invest their profits back into their production.
Sameer Kohinkar, the procurement manager of Sonata CI.
“The project has given a tremendous boost to the implementation of our procurement strategy,” said Sameer Kohinkar, Procurement Manager of Sonata CI since 2018. “The training of trainers and producers led by PRO-Cashew and the establishment of producer groups in the villages have enabled us to build a reliable network of producers and cooperatives in the major cashew producing regions of Côte d’Ivoire,” he added. “Now, thanks to our purchasing network, in less than two years, we have developed a strong supply system. In return, we pay cash at a price set by the state trade regulation authority, and we offer price-based incentives to encourage farmers to produce good quality nuts, which results in a higher price for the farmer,” Kohinkar explains.
The Sonata CI Supply Chain Program has only been active for a year and a half, but the preliminary results are promising. The volume of cashews purchased directly from farmers by Sonata CI, without intermediaries, increased by 59.9% from 1,614 tons to 2,581 tons from May 2020 to May 2021. Aiming to incentivize quality RCN production, Sonata CI developed an agreement with farmers to increase the minimum price of 305,000 FCFA/MT, approximately $505/MT, set by the Government of Cote d’Ivoire, by 10,000 FCFA/MT or an additional $16. Sonata CI’s higher purchasing price encourages producers to adopt quality production methods. It also improves farmer access to more profitable markets while improving supply chain efficiencies (i.e., developing a dependable and quality RCN supply).