Tanzania Investment Bank (TIB) has signed a Memorandum of Understanding (MoU) with Tandahimba Newala Cooperative Union (Tanecu) for the construction of a cashew nut processing factory in Mtwara Region.
TIB Managing Director Peter Noni told reporters in Dar es Salaam on Monday during the signing of the agreement that the modern factory would help add value to cashew nut production.
“As you all know, an unreliable market has been a major problem to most farmers in the country. Cashew nut growers sometimes fail to sell their produce because of this. We want to construct our own factory so that we can sell the cashew nuts without middlemen,” Noni said.
He explained that as a bank they realised that by having processing factories farmers would have reliable markets and crops would be sold at reasonable prices.
“We as TIB will collaborate with Tanecu to ensure we construct a factory, which will be free from external interference,” he said.
The director further said the cost of constructing the factory would be known after completion of a feasibility study. “What we are doing now is that we use the technical assistance fund to carry out a feasibility study, which will start in June and there after other processes will follow,” Noni said.
He said the factory would have the capacity of processing 30,000 tonnes of cashew nuts per year and Tanecu will cover 20 per cent of the construction cost, while TIB will cover the remaining 80 per cent.
For his part, Tanecu Chairman Yusuph Nannila said they expected to start the construction of a big warehouse in July in Tandahimba area at 1.4bn/-.
He said the main objective of constructing a factory was to add value to cashew nut production. He said cashew nut growers lacked a reliable market since it was only India, which bought unprocessed cashew nuts from Tanzania.
“If we succeed in constructing the cashew nut processing factory we will have solved problems associated with the market. We want cashew nuts to lead in the country and this will also improve people’s incomes as well as Tanecu’s,” he said.
Tandahimba Member of Parliament Juma Njwayo said the main problem facing cashew nut growers was the market.
“Our cashew nuts have great value if processed in the country. Currently, a farmer sells a kilo of cashew nuts at less than 1,000/- but the same kilo of processed cashew nuts is sold at 10,000/-,” he said.