ARDB Boosts Cashew Nut Sector with Additional $30M Funding
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The Agricultural and Rural Development Bank (ARDB), a government institution, is set to infuse an extra $30 million into the cashew nut industry. This funding aims to serve as operational capital for the collection, stockpiling, and processing of cashew nuts, catering to both local consumption and export demands.
In a recent development, the ARDB has earmarked around $30 million for the acquisition of cashew nuts in 2024. This allocation comes on top of the $30 million already disbursed, as revealed by Phan Phalla, Secretary of State at the Ministry of Economy and Finance, during a public forum on macroeconomics and the 2024 budget law.
The initiative seeks to enhance the domestic cashew processing network, thereby curbing the export of unprocessed cashew nuts. The ARDB, along with the state-owned SME Bank, has been instrumental in providing financial support to this burgeoning sector, aiming to elevate cashew production and the export of processed cashews to the global market.
The SME Bank has also been allocated approximately $100 million by the government to offer working capital to small and medium-sized enterprises (SMEs) within the cashew industry. This move is designed to address the operational hurdles in the cashew production chain and to foster the expansion of the cashew processing industry within Cambodia.
Silot Uon, the Country Director of the Cashew Nut Association of Cambodia (CAC), highlighted the industry’s significant need for working capital, estimating a requirement of at least $300 million annually. A lack of funds to purchase raw cashew nuts often leads to these nuts being sold internationally, causing local production lines to experience extended periods of inactivity. According to Silot, some companies face stock shortages lasting from three to eight months.
In the previous year, Cambodia’s export of raw cashew nuts reached 425,977 tonnes, marking a 9.9 percent decrease compared to the year before, as per a report from the Ministry of Agriculture, Forestry, and Fisheries.
Cashew cultivation is predominantly located in regions such as Kampong Cham, Thbong Khmum, and several other provinces, the report noted. Despite being one of the top 10 global producers of cashew nuts, Cambodia processes only 5 to 10 percent of its harvest, with the majority of raw cashews being exported, mainly to Vietnam. There, they are processed and re-exported at higher values.
To address this gap, the Cambodian government has introduced the National Cashew Policy 2022-2027. This strategic plan outlines key objectives in production, processing, and exports, with an ambitious goal for Cambodia to lead the world in cashew nut production.
