Cracking the Nut: Traceability and Sustainability by Local Processing

One of the pioneers of working on sustainability in nut supply chains is Nuts2. Instead of shipping the raw cashew nuts from Burkina Faso and Benin to Asia Nuts2 has two local processing facilities in West Africa. This way Nuts2 can guarantee traceability, work on quality and volume of the product and create local impact. We spoke to Harm Voortman, managing director of local processor Anatrans in Burkina Faso.

Harm Voortman: ‘Anatrans was founded in 2009 by Nuts2 and is currently the biggest cashew processor in Burkina Faso. The company sources fair trade, organic and conventional cashews from around 4000 local farmers through cooperatives. It then shells, peels and grades the cashews for export to Europe and the United States. About 2200 people work in the factory processing about 10,000 tons per year’.

Processing locally provides jobs, traceability & sustainability

The cashew supply chain is complex with many different actors, continuous changing market dynamics and limited transparency. Africa is the major cashew nut producing region. The Raw Cashew Nuts (RCN) are being produced by millions of smallholder farmers in West Africa. Although Africa is a large producer most processing takes place in Vietnam and India. Harm Voortman: ‘The main advantage of shipping the RCN to Asia is the large-scale and efficient factories with the usage of automatic equipment. The disadvantage is that these countries process local raw nuts, nuts from Ivory Coast, Burkina Faso and so on. Due to mixing or origin, there is no insight into where the products came from. The cashew nuts cannot be traced back, there is no insight in issues and sustainability in the supply chain’.

‘This is why Nuts2 wants to process in the country of origin. Processing raw cashew nuts locally creates jobs and added economic value. Anatrans is the city's largest employer; not only people who work in the processing facility but also the suppliers such as service and maintenance suppliers benefit from a local factory. If you look purely at costs, it is more efficient to process in Asia. However we do not try to compete on costs, but we try to convince the customer that there is more value in our product. Value of traceability, sustainability and entrepreneurship in a responsible manner.

Cracking the Nut Programme

Harm Voortman: ‘Setting up a local processing facility in a place where there is no experience with this and little knowledge and skills is not done overnight. We need partners with experience building a local supply chain’. Within the Cracking the Nut program, a public private partnership of Nuts2, Woord & Daad en FairMatch Support, Anatrans works with FairMatch Support among others, to create an inclusive, profitable and competitive cashew sector in Burkina Faso. The program focusses on the production at farmer level, development and professionalising of the processing, looking at the by-products of the cashew value chain such as the processing of cashew apples, the financing of farmers with micro credits and politics and policy of the cashew sector.

Harm Voortman: ‘A broad program where we look at the chain as a whole. Anatrans partners with FairMatch Support on the part of production at farmer level and becoming a professional business partner from both sides. To process traceable and certified cashews Anatrans is sourcing directly from farmers’ cooperatives. Building relations with local farmers is complex, however this way we are more assured of sufficient supply to our processing facility now and in the future. Farmers and their cooperatives benefit from higher and more stable income; when others stop buying, we continue: the market is not guaranteed, but a lot more certain. FairMatch Support supported us to work on a buying strategy with the farmers. This consisted of coaching and training farmers’ cooperation’s on professionalisation and organisational capacity, quality improvement, higher volume, relationship management and negotiation with the processors. In addition, FairMatch Support works on coaching and training of the processor to build a good relationship with the farmers and to improve the purchasing strategy.

Inclusive and profitable cashew sector

Harm Voortman: ‘By linking production with processing and processing with the market, the Cracking the Nut program has created an inclusive, profitable and efficient supply chain from field to fork. The number of traceable and certified cashews from Burkina Faso has grown significantly in recent years compared to other African countries. At Anatrans we grow 40-50% in volume every year. Direct sourcing from farmers' cooperatives helps us to work with the farmers on improvements. One of the important lessons from FairMatch Support is the segmentation of farmer groups. Segmentation ensures that you can train in a targeted manner based on the possibilities and potential of the groups. These targeted training courses have led to a number of highly professional cooperatives that are able to combine high production with a good logistics and administrative organisation and thus make large volumes available for Anatrans. Anatrans can purchase large volumes through these organisations and it only needs to negotiate and make agreements with a few cooperatives in order to obtain a large part of the total volume. This saves money and simplifies administration considerably’.

Professionalise the processing facility

Harm Voortman: ‘When we just started in 2009 we worked primarily manually at Anatrans. In processing there are specific machines for cashews, which are being built in Asia. To operate it, you need knowledge, skills and well-trained people. Because we don’t have a long history of processing there are not many educated people who can work with these machines. It requires other competences from the staff. That is our biggest challenge now; how can we continue to professionalize and develop further and find the right personnel for this. The same applies to certifications for food safety, ethical trade (such as SMETA) and kosher. We are pioneering which is great but comes also with certain challenges’.

The business approach of FairMatch Support

Harm Voortman: ‘The interventions of FairMatch Support definitely contribute to the increasing volumes and quality improvement of the raw nuts, although there a more factors. For example that farmers know the quality that we are looking for so they select the better quality nuts and not deliver the ones that do not comply’.