FEASIBILITY_STUDY_BUSINESS_PLAN_FOR_CASH.pdf

A FEASIBILITY STUDY BUSINESS PROPOSAL PLAN
ON CASHEW CULTIVATION
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A FEASIBILITY STUDY BUSINESS
PROPOSAL PLAN
ON
CASHEW CULTIVATION
DEVELOPED BY
BRITECH PLUS+ ENTERPRISES
FOR
TABGATE AGRO ALLIED LTD RC1394230
17, MERCY STR OFF MERCY AVENUE, ORILOWO ESTATE. AGORO BUS STOP
ALONG ABEOKUTA EXP WAY OGUN STATE NIG.

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Table of contents
Introduction…………………………………………………………………………….3
Aim and Objective…………………………………………………………………….3
Executive Summary…………………………………………………………………..3
Market Analysis……………………………………………………………..............4
Management team……………………………………………………………………12
Technical Specifications/Production Plan…………………………………...14
Marketing Plans……………………………………………………………..............32
Examination of Risks and Problems…………………………………………….33
Financial and Economic Plans…………………………………………………….36
Funding…………………………………………………………………………………….42
Conclusion………………………………………………………………………………..42

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1. INTRODUCTION
Cashew (Anacardium occidentale), a native of Brazil, was introduced in Nigeria during the later
half of the Sixteenth Century for the purpose of afforestation and soil conservation. From its
humble beginning as a crop intended to check soil erosion, cashew has emerged as a major
foreign exchange earner next only to tea and coffee. Cashew nut is one of the important nuts
grown in the world and ranked first. Among various nuts such as hazelnuts, almonds, etc.,
cashew nut enjoys an unenviable position and it is an unavoidable snack in all important social
functions especially in the westerncountries.
2. AIM & OBJECTIVE
This business feasibility studies try to show the likelihood of your proposed action succeeding or
failing, through a careful look at the costs and opportunities involved.
This studies helps to determine if a proposed strategic action makes sense operationally and will
produce the desired results
3. EXECUTIVE SUMMARY
Feasibility Study on the establishment of a cashew cultivation is based on the survey made by
Britech Plus+ Enterprises, and the business wholly owned by him Mr. Femi. The farm will be name
TABGATE AGRO ALLIED LTD and will concentrate on growth of cashew fruit and it’s by
products.
We will supply fruits, cashew nut and its other product forms to different quick service in south
west Nigeria and our vision is to be one of the known cashew product supplier in Nigeria with a
mission to have varieties of cashew products at a very profitable venture.
From the research that was carried out it was discovered that the demand for cashew nuts and its
byproducts is not fully satisfied in Nigeria, though they are already existing agricultural farms
operating around borders of Abeokuta and Ogun state environment, the cashew cultivation plant
will be sited at Obafemi Owode Local Governement, Abeokuta in Ogun state. There are high
demand in some part of Nigeria majorly Enugu, Lagos, part of Ogun. These legal requirements for
the establishment of this venture such as local government revenue (tax) per month and security
payment (vigilante) per month have been inquired and will be carefully complied with.
Population: Obafemi-Owode Local Government has an estimated population of 230,000.
Land mass: It is made up of about 1,204 towns and villages with a land mass of 104,787.07
hectares of largely agricultural land.
Obafemi Owode Local Government is endowed with vast fertile land suitable for the cultivation of
rice, kolanut, sugarcane, maize, cassava, tomatoes and a wide variety of vegetables. The Local
Government is generally regarded as the land of OFADA rice. The major food crops of the area
includes cassava, rice, cocoyam, plantain, maize and vegetable, while palm produced and cocoa
form the major cash crops.

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Obafemi Owode Local Government has some motorable (graded) roads which are linked by state
and federal road network for inter and intra city connections.
The Federal roads running through the Local Government area include:
 Lagos-Ibadan Express way
 Abeokuta-Sagamu road
 Sagamu-Papalanto road
State roads within the area include:
 Owode-Siun-Ofada road
 Siun-Iperu road
 Owode-Obafemi road
 Kobape-Oba-Ojere road
 Idi-Aba-Ajebo road
 Ogunmakin-Ajebo road
 Ofada-Mowe road
The venture will help in providence employment to the locals meeting the demand of cashew nuts
and making the price affordable in future, TABGATE AGRO ALLIED LTD intends to develop
into other cashew by products.
3.1 STRATEGY AND IMPLEMENTATION SUMMARY OBJECTIVE
 To increase number of our client by 50% within 5 years of existence.
 To evaluate our strategic marketing by every three months.

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 To maximize profit by 50% every year
4. MARKET ANALYSIS
4.1 TACTICS AND STRATEGY IMPACTS
TABGATE AGRO ALLIED LTD products will be priced at affordable rate. When a markup is
placed on any of our products, customers will be willing to pay because of the affordable price.
The business to be established is a cashew plantation that will concentrate on the production of
cashew nuts and its byproducts because of the fund required the venture will start as a small scale
business in Obafemi Owode Local Governement, Abeokuta in Ogun state with 100hectres of land.
The farm site will be a permanent land and will need necessary equipment for its operation as it is
entirely new firm to start from the scratch.
4.2 MAJOR COMPETITOR
 Valency Cashew Processing Limited , Abeokuta Unity Estate Off Lagos-ibadan Expressway
Ibafo Ogun Cashew Nuts Soy Milk Food Processing Machinery Nuts & Kernels Bean
Products
 E.L.O Ngodo Enterprises Limited , 38 Ebenezer Akintunji Avenue Ikotun Lagos
Agricultural Greenhouses Cocoa Beans Chickpeas Agricultural Product Stock Dried
Flowers
 Trinity Agros , Akure Legacy Palace Lodge Ibadan-ilesha Expressway Akure Soybeans
Animal Extract Honey Beans Agriculture
 Vogue Express Nig Ltd, Lagos 20 Church Street Odonguyan Ikorodu Lagos Cashew Nuts
Graphite Powder Lime Graphite Products Nuts & Kernels
 Devgru Transnational Enterprises, Lagos Unit 1 Lekki Gardens Ajah Lagos. Agricultural
Greenhouses Agriculture
 Mcube Global Connect Limited Rc.989573, Lagos 100 Obafemi Awolowo Way Ikeja. Lagos
Agricultural Greenhouses Passport & Visa Advertising Other Agriculture Products Travel
& Tourism
4.3 MINOR COMPETITOR
1. Obasanjo farm (Ota farm) company. The owner of this company is Chief Olusegun
Obasanjo, he is also known as a retired army officer, and politician. His farming company
is known as Ota farm, but the full name is Obasanjo Farms Nigeria Limited. The company
was opened on October 8, 1979. In the beginning, the staff of the company consisted of four
bulldozer operators and now the number of workers is about 7,000. Obasanjo farm played
an important role in the development of agriculture in Nigeria. The company was a pioneer
of mechanization in the industry and this is one of the reasons for its success. Obasanjo
farm considers agriculture as a profitable and vital industry important for all spheres of life.
Today a high-class expert manages the company. The territory of the farm is around 30
thousand hectares.
2. Maizube farms the owner of this company is General Abdulsalami Abubakar, he is also
known for his military and political career. Maizube Farms Limited plays an important role
in the development of agriculture in the country in this era. The farm is located in Minna,
Niger State. It is a 500-hectare multi-product farm that has crop and livestock sections. The
company is considered as one of the most stable sources of animal and crop products.

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3. Sebore farms the owner of this company is Admiral Murtala Nyako, he is also known as
executive governor of Adamawa State. Admiral Murtala is not only a successful politician
but also one of the most successful farmers in Nigeria.
4. Sebore Company is a multipurpose farm situated in Mayo Belwa, Adamawa State. This
is one of the largest mechanized farms in the country. Anandaruya farms the president/CEO
of the company is Usman Dantata Jr. The large company is a poultry farm located in Tiga,
Bebej, Kano State. The company was founded by Alhaji Usman Sanusi Dantata in the 1960s.
Now the company produces above 3, 000 broilers weekly. The company is considered the
most viable farm in the country at the present time.
5. Jovana farming company The Company is situated in Mushin, Lagos. The specialization
of the company is farming of animals grass cutters (greater cane rats), quail, rabbits, guinea
pigs, antelope, fish, and so on. The CEO of the farm is Prince Arinze Onebunne, he is also a
known consultant in the questions of farming.
6. Animal care service Konsult The founder of this company is a veterinary doctor
Olatunde Agbato. The firm became a viable player in the agricultural sector. The company
does commercial poultry production, aquaculture, commercial livestock feed milling,
manufacturing, distribution and procurement of animal health products. The farm also
provides expert services of the highest level Animal care started its work in 1979 in Ogere
Remo, Ogun State.
7. Nagari integrated dairy farm the company has a status of largest single integrated dairy
farms in Africa. The territory of a farm is 1,200 hectares and the number of cattle in the
farm is more than 7,000. The firm developed its own methodologies of farming and
expertise in dairy farming.
8. Folawiyo farms limited The Company is located in Apapa, Lagos. The date of its
foundation is October 4, 1985, today there are several branches of the company across the
states of the country. Folawiyo Farms stands on a high position in many aspects of the
agriculture industry in the country. The firm works with livestock farming, fish farming,
agricultural consultancy, flour milling, engineering and development, farm tools,
horticulture, fertilizer services and so on.
9. Anu-Oluwa farm the specialization of the company is poultry and egg production and
this is one of the largest farms in the country in this sphere of industry. It also sells materials
and livestock feeds, day-old chicks, fish and fish fingerlings, table eggs, the point of lays and
livestock vaccines.

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4.3 CURRENT MARKET PRICE
Fig 1. Market price report for Cashew Seedling
26/06/19 Seedling/One 30000/ 100hectre Seedling Cost for
100hectres
Sambuk Agricultural
Enterprises Ltd
100 100*30,000 N3,000,000
Ogbomosho Cashew 150 150*30,000 N4,500,000
Hybrid Dwarf Cashew
Seedling ( Brazilian)
200 200*30,000 N6,000,000
Average Price/ ONE 150 TOTAL N4,500,000
Fig 2. Market price report for land Lease/Sales
26/06/19 Land 1 Acre Land 250 Acre 10years
Projection
Lease N6,000/year N1,500,000/year N15,000,000
Sales N300,000 N75,000,000 N75,000,000
Fig 3. Cashew Shelling Machine
Vendor Address Cost Country of
Manufacturer
Bio Treasure Ltd Gudu
Abuja Nig
N350,000 Nig Made
Guangzhou
Fengtai
Machinery Co.,
Ltd.
China US$1,600.00 China

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4.3.1 Cashew Nut Processing Business Plan – MARKET ANALYSIS
 Market Trends
Cashew nuts have become one of the most consumed nuts amongst other types of nuts; this is
because of the positive effects of nuts such as these on the human body. However in order to meet
the growing demand, genetically modified crops have been looked into which will help those in
the business to keep up with demand.
Nuts especially those of cashew contain nutrients such as fibre, proteins, folate and several other
minerals, and this has encouraged more people to consume this nut daily.
Cashew nuts which come from the cashew tree grow in tropical regions and as such businesses
that process these nuts in these regions spend less to get them, as against those that process the
nuts in areas where the cashew trees don’t grow.
 Our Target Market
Our processed organic cashew nuts will be one that will be made available to all our customers in
our target market. Our target market however at a glance cannot be restricted to just a group of
people, which is why we have conducted a market research that will enable us fully determine
who we are really going to sell our products to.
The market research we have conducted will enable us have an idea of the market and what we
should be expecting from them. We therefore are in business according to research to cater to the
following groups of people;
 Bakeries
 Confectioneries
 Households
 Celebrities
 Workout Enthusiasts
 Sports men and Women
 Health and diet enthusiasts
 Individuals
 Retailers
4.3.2 Our Competitive Advantage
Our intention of starting Cashew Cultivation is to ensure that we build a business that will be
amongst the top one well known processed cashew nuts brand globally and will be amongst the
first top five brands here in the Federal Republic of Nigeria. To achieve this huge vision, we have
come up with competitive strategies that will allow us compete favourably against our
competitors.
We intend to process cashew nuts, which we know is more difficult to procure but which our
clients will prefer. We have therefore set plans in place to ensure that we are able to grow our own
cashew so as to fully achieve our vision. Our facility is not only one that is well equipped and
fitted with standard equipment but is also conducive and accessible to our employees.
All those who work for us come with vast experience and our management staff are those who are
not only highly experienced but understand how to build a business from scratch to becoming
a national phenomenon. We have a solid distribution network and an excellent customer service
culture that will be of great advantage to our business.

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Finally, we have great welfare and incentive packages that will ensure that our employees are well
paid, and that those who work hard enough get incentives that is intended to boost their attitude.
4.4 Cashew Nut Processing Business Plan – SALES AND MARKETING
STRATEGY
 Sources of Income
TABGATE AGRO ALLIED LTD is established with the aim of generating revenue and maximizing
profit in the agro processing cum food industry here in Nigeria. To maximize this profit, we are
going to do all that we can to ensure that a large percentage of our target market gets our
products.
TABGATE AGRO ALLIED LTD will therefore generate income by selling the following products
and services;
 Sale of processed packaged cashew nuts – salted and roasted – to all our various clients
 Franchise
 Consultancy and Advisory Services
 Training
 Processing of Cashew Fruits Juice- In nearest Future
Sales Forecast
The use of processed cashew nuts have spread from commercial purposes to personal purpose,
which means there will always be a demand for processed cashew nuts.
Since cashew nuts grow majorly in tropical regions, our location here in Abeokuta means that we
are well positioned to meet the demands of our target market all over Nigeria in not only
generating enough income but also making enough profit in our Third year and breaking even in
our forth to Sixth year.
Our optimism stems from the fact that we carried out critical examination of the agro processing
industry cum the food industry in order to analyze our chances and know how we were likely to
fare not only in this industry but from the environment where we are operating from. Data and
information that was used to forecast our sales projection were taken from similar start-ups such
as ours here in Abeokuta and all over Nigeria.
Below therefore are the sales projections for TABGATE AGRO ALLIED LTD and based on several
assumptions and data gotten from the market;
 Third Fiscal Year-: N100,000,000 – N150,000,000
 Fourth Fiscal Year-: N150,000,000 – N200,000,000
N.B: The above sales projections were carried out based on what we obtained from the industry
for the stated period. The assumptions used were that there won’t be an economic meltdown and
that we won’t have to battle with the arrival of a major competitor offering same services during
the stated period. Should there be any change whatsoever in the above assumptions used, it
would affect our sales projections and might cause an increase or decrease in the figures.
 Marketing and Sales Strategy
Marketing is a very important part of any start-up business as this section not only has to
understand what the target market wants but also know the right strategies that will be needed to
be applied on this target market in order to bring forth results – revenue. The revenue gotten

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from marketing a business is what is being used to continue to run the business after the capital
must have been exhausted. Marketing therefore is very paramount to the growth of a business.
In view of this, we intend to first conduct a thorough market research that will allow us
understand our target market and what to expect from them. Also the market research will allow
us draft effective marketing strategies that will allow us have a huge share of the market and also
be able to compete favourably against our competitors, not only here in western side of Ogun but
all around the Federal Republic of Nigeria. We will also look for new target markets so as to gain
grounds and have a large share market in centre side of Abeokuta Nigeria
We intend to engage the services of a reputable marketing consultant who has experience in this
industry and environment to help draft effective marketing strategies that will allow us stand out
in the market place. We will also empower the marketing consultant to ensure that he or she
works with our marketing team to incorporate our corporate marketing and sales goal and help us
achieve our goals and objectives.
We intend to ensure that our marketing and sales team are not only empowered to monitor the
marketing strategies drafted but also review and remove the ones thought to be ineffective or
ones that will not fully achieve what we intend it to. Our marketing and sales team will also make
use of technology and other means in ensuring that our processed cashew nuts are marketed to
our target audience.
Therefore, the marketing and sales strategies that we intend to adopt at TABGATE AGRO
ALLIED LTD in selling and marketing our business are;
 Ensure that we introduce our cashew processing nuts business formally to high level and
corporate clients as well as other stakeholders in the industry
 Throw a unique party before declaring the business open, to generate interest amongst
our target market
 Place advertisements in local newspapers and food and lifestyle magazines as well as on
local radio and television stations
 Use our social media platforms such as Facebook, Twitter and Instagram to market and
sell our processed cashew nuts
 Ensure that we are listed in yellow pages as well as on online directories
 Engage in direct marketing to all our clients
4.5 Cashew Nut Processing Business Plan – Publicity and Advertising Strategy
Ensuring that a brand has constant and positive awareness is very important and all brands know
the essence of this, whether new or already established. Publicizing a brand is also a means of
advertising the brand to ensure that not only the target market are aware of the brand, but that
more people patronize the brand by either buying its products or paying for its services. Publicity
also ensures that the image of the brand is positively communicated as well as its corporate
values.
In view of this, we intend to engage the services of a brand expert who not only understands the
business thoroughly but the environment we are operating from and what strategies would best
be applied that will allow more people to be attracted to us.
Also, the publicity strategies that would be proffered will be one that will allow us compete
favorably against our competitors – new or already existing. The platforms that we intend to use
therefore in promoting and advertising TABGATE AGRO ALLIED LTD;
 Create an interactive website and do all we can to publicize our cashew nuts and other by-
products

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 Place advertisements on local newspapers and lifestyle magazines as well as on radio and
television stations
 Place flexible banners in strategic locations in and around the environs of Abeokuta
 Distribute our handbills and fliers in target areas
 Use social media platforms such as Facebook, Twitter and Instagram to vigorously
promote our brand
 Participate in local community programs by sponsoring programs that would promote our
cashew nuts processing business
4.6 Our Pricing Strategy
Setting the right price for our cashew nuts and juice is very important especially as we intend to
make profit from our business. It is important therefore that we identify all the factors necessary
so that we would be able to offer fair prices to our customers whilst also not running at a loss as a
business ourselves. The factors that we will consider are what our overhead and running costs
are, what our competitors are offering and what the industry determines as fair without causing a
price war.
In order therefore for us to attract the number of customers that will allow our business to grow
as it should, we will be offering a discount on our processed cashew nuts for the period of three
months. We have carried out a careful study of this period and have determined that even though
we will be running at a low gross margin for this period, we will not be incurring any loss
whatsoever for our business.
 Payment Options
Due to the all-inclusive payment plans we intend to adopt at TABGATE AGRO ALLIED LTD that
will accommodate all our different customers and their diverse preferences, we have carefully
studied several payment options and come up with the best.
Some of the payment options that we therefore will make available in every of outlets include;
 Payment via cash
 Payment via Point of Sale (POS) machine
 Payment via Credit Card
 Payment via online payment portal
 Payment via bank draft
In view of this, it should be noted that we carried out careful deliberations on each payment
option before adopting it. The above payment options will be advantageous to both our company
and our clients as well.

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5. MANAGEMENT TEAM
FARM MANAGER (1)
Job Duties and Tasks for: "Agricultural Crop Farm Manager"
QUALIFICATION: HND/BSC (AGRICULTURAL SCIENCE)
CASHIER/ACCOUNT (1)
QUALIFICATION: HND/BSC (ACCOUNTING)
STORE KEEPER/WAREHOUSE OFFICER
QUALIFICATION: ND (INVENTORY MANAGEMENT)
FARM ATTENDANT (6)
QULIFICATION: ND (ANY SCIENCE RELATED COURSE)
FACTORY WORKERS (4)
QUALIFICATION: SSCE/ND (ANY RELATED SCIENCE)
CLEANER (2)
QUALIFICATION: SSCE
SECURITY OFFICER (4)
QUALIFICATION: SSCE
 Chief Executive Officer
 Human resources and Admin Manager
 Purchasing Officer
 Food Technologist
 Marketing and Sales Team
 Accountant/cashier
 Customer Service Executives
 Delivery Drivers
 Store Manager
 Cleaner
Roles and Responsibilities
Chief Executive Officer
 Creates the vision and direction for the organization, communicates and ensures that it is
effectively implemented
 Drafts the overall budget and other important documents on behalf of the organization
 Monitors and evaluates the direction of the business and removes policies that are not
regarded as effective
Human resources and Admin Manager

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 Ensures that all the administrative functions of the organization flows smoothly
 Recruits and carries out orientation for new employees. Also trains and carries out periodic
assessment on the employees
 In charge of the overall welfare and incentive package of the employees
Purchasing Officer
 Responsible for procuring raw materials on behalf of the firm
 Sources for vendors and suppliers and ensures that they are reliable, and deals with them
on behalf of the organization
 Drafts and reviews the necessary purchasing contracts for the benefit of the organization
Food Technologist
 Responsible for ensuring the right preservation of the processed cashew nuts before being
packaged and sold to customers
 Ensures that due process is followed at all times during processing and packaging of the
cashew nuts
 Serves as the quality assurance officer on behalf of Tabgate Agro Allied Ltd
Marketing and Sales Team
 Conducts market research in order to discover new target markets on behalf of the
organization
 Responsible for drafting effective marketing strategies and also developing new plans in
order to expand and increase sales
 Helps increase sales or the organization by engaging in direct marketing and sales
Accountant/cashier
 Prepares financial statements, accounts, reports and budgets on behalf of the organization
 Manages cash inflow and outflow and also administers payrolls
 Ensures that the organization complies with tax by preparing accurate tax information and
submitting to the tax authorities
Customer Service Executives
 Works on behalf of the company by taking orders from clients, answers inquiries
by passing along accurate information
 Maintains an accurate and updated customer database on behalf of the organization
 Stays abreast of industry trends and also organizational policies so as to pass accurate
information to customers
Delivery Drivers
 Drives the company’s van to and from several sales location and ensures that all orders are
accurately delivered
 Supervises and assists the loading and offloading of products from the van

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 Ensures that he obeys traffic regulations at all times and keeps a logbook of distances
travelled and routes taken
Store Manager
 Responsible for inventory and monitors to know when replenishment is needed
 Responsible for the security of the shop
 Carries out light repairs when necessary
Cleaner
 Responsible for cleaning the premises and convenience for employees and customers
 Ensures that cleaning supplies don’t run out of stock
 Carries out any other duties as might be assigned by the human resources and admin
manager
6. TECHNICAL SPECIFICATIONS/PRODUCTION PLAN
6.1 OPERATIONAL PLAN
Introduction
The cashew tree (Anacardium occidentale L.) is indigenous to Brazil and is an evergreen nut-
bearing tropical plant that grows in latitude 15° north and south of the equator. It is a
multipurpose tree crop with great economic importance to third world countries including Benin
Republic, Brazil, Cote d’Ivore, Guinea Bissau, Ghana, India, Mozambique, Nigeria, Philippines,
Sri Lanka, Tanzania and Vietnam. Morphologically, the Cashew wood is also used for furniture
and fishing boats. Of all, cashew nut is the most economic part of the cashew tree providing
foreign exchange earnings for producer countries. In Nigeria cashew nuts exports represent 7 to
8% non-oil export earnings.
The estimated export value varies from US$ 25 to 35 million annually (Nugawela and Oroch,
2005). Cultivation and processing activities in cashew provides employment and income
generation for women and smallholder farmers in Nigeria (Akinwale, 2000; Topper et al., 2001).
It supplements the income of about 50,000 farmers and an additional 55,000 people employed
down its’ value chain (Nugawela and Oroch, 2005) as harvesters, transporters, processors,
marketers, exporters etc. Women are particularly involved in the cashew sub-sector more than in
any other cash crop of the nation.
Cashew was introduced into Nigeria by the Portuguese traders around the 16th century
(Woodroof 1967; Ohler, 1979). It was first planted in Agege, Lagos State, from it spread to a few
other parts of the country through transfer of nuts by man. For over 400 years after
introduction, cashew trees were exploited mainly for apple; no commercial value was attached
to the nuts (Aliyu, 2012). Many of the trees flourished in the wild while being utilised for
aforestation and erosion control scheme particularly in the escarpment areas of Udi in Anambra
state. The first commercial cashew planting in Nigeria was in the mid 1950 at Ogbe, Oji, Udi
and Mbala by the defunct Eastern Nigeria Development Corporation (ENDC) and Iwo, Eruwa

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and Upper Ogun by the defunct Western Nigeria Development Corporation (WNDC) (Akinwale
and Esan, 1989; Asogwa et al., 2009). These plantations were established with introduced
Indian cashew varieties. Progress in the cashew industry then was low due to general neglect
and poor management of the plantations. With the involvement of private entrepreneurs,
Federal and State Governments, and affluent farmers more nuts were obtained in 1978, 1980
and 1982 from India, Tanzania, Mozambique and Brazil to broaden the cashew genetic base of
the country. Today, cashew cultivation has spread to almost all the states of Nigeria with
increased processing, shipping and exporting activities. The major Cashew growing areas in the
different parts of Nigeria in the order of the level of productivity with respect to the different
regions of the country are: Enugu, Abia, Imo, Anambra, Ebonyi and Cross River States in the
east and southern part, Oyo, Osun, Ondo, Ekiti and Ogun States in the western part, Kwara,
Kogi, Nassarawa, Benue, Taraba, Niger, Federal Capital Territory (Abuja), Kaduna and Plateau
in the Middle Belt and Sokoto and Kebbi States in the North- western of the country (Ezeagu,
2002; Chemonic 2002) (Figure 1). It is noteworthy that the majority of export quality nuts come
from the Western and Eastern parts of the country.Cashew cultivation is taken up in small and
marginal holdings and as more than 70% of the cashew area is under this category, cashew plays
an important role in the development of small and marginal farmers.
The National Cashew Associaton of Nigeria (NCAN) is the umbrella body charged with regulating
the Nigerian Cashew Industry for the benefit of all stakeholders be it Cashew Farmers, Traders,
Processors Exporters and Service Providers
Cashew is national crop and is grown in 19 states; Abia, Anambra, Akwa Ibom, Benue, Cross River,
Delta, Ebonyi, Edo, Ekiti, Enugu, Imo, Kogi, Niger, Nassarawa, Ogun, Osun, Oyo, Taraba and
Kwara.
However, cashew can be grown in almost all the states of Nigeria. The Nation currently produces
120,000 tons of Cashew Nut annually and has capacity for much more.
WHAT THEY DO
 Promote the Nigerian cashew industry.
 Encourage investment into the Nigerian cashew sector.
 regulate the industry for the benefit of the stakeholders:
Cashew Farmer, Traders, Exporters, Processors and all Service Providers.
 Encourage increased Local and International Consumption of Nigerian Cashew.
 Encourage increased value addition to Nigerian Cashew.
 Encourage increased planting of cashew trees across Nigeria.
http://ncan.org.ng/become_ncan_member.php

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6.2 Technical Requirements of Cashew Cultivation
Soil
The general notion is that "cashew is very modest in its soil requirements and can adapt itself
to varying soil conditions without impairing productivity". While Cashew can be grown in poor
soils, its performance would be much better on good soils. The best soils for cashew are deep
and well-drained sandy loams without a hard pan. Cashew also thrives on pure sandy soils,
although mineral deficiencies are more likely to occur. Water stagnation and flooding are not
congenial for cashew. Heavy clay soils with poor drainage and soils with pH more than 8.0 are
not suitable for cashew cultivation. Excessive alkaline and saline soils also do not support its
growth. Red sandy loam, lateritic soils and coastal sands with slightly acidic pH are best for
cashew.
Climate
Cashew is a tropical plant and can thrive even at high temperatures. Young plants are sensitive
to frost. The distribution of cashew is restricted to altitudes up to 700 m above mean sea level
where the temperature does not fall below 20°C for prolonged period. Areas where the
temperatures range from 20 to 30°C with an annual precipitation of 1000 - 2000 mm are ideal
for cashew growing. However, temperatures above 36°C between the flowering and fruiting
period could adversely affect the fruit setting and retention. Heavy rainfall, evenly distributed
throughout the year is not favourable though the trees may grow and sometimes set fruit.
Cashew needs a climate with a well-defined dry season of at least four months to produce the
best yields. Coincidence of excessive rainfall and high relative humidity with flowering may
result in flower/fruit drop and heavy incidence of fungaldiseases.
Varieties
The research programmes on crop improvement had resulted in identification of elite materials
with yield potential ranging between 20-25 kg of nuts per tree. Several varieties have been
released by the different co-ordinating centres of Nigeria Council of Agricultural Research
(NCAR). All the Agricultural Universities and Research Centres have established bud wood
bank with the released varieties of respective centres for further multiplication and distribution.
The cashew varieties recommended for different states are given in the Table 1.

17
6.3 Planting material
Cashew is a cross pollinated crop and exhibits wide variation in respect of nut, apple and yield
of seedling progenies. Therefore, vegetative propagation has been advocated to mitigate this
problem. Air layering has been quite successful but survival percentage is low and it has been
reported that the plantations raised from air layers are more susceptible to drought and the
life of such plantation is shorter as compared to that of grafted or seedling ones. The anchorage
has also been observed to be poor, especially in cyclone prone areas. Epicotyl grafting and
softwood grafting are found to be successful because it is easy to produce large number of
grafts in a short time. The percentage of field establishment is also reported to be high with
these grafts. Adequate thrust has been given to produce enough planting material through
these standardized techniques by the ICAR (through the Directorate of Cashew Research, its
sub-stations, Agricultural Universities and State Departments of Horticulture/Agriculture), to
meet the growing demand. Production of cashew planting material is one of the economic
activities in most of the states. The planting material is raised in these nurseries within a year.
The farmers can purchase planting material from these nurseries but care should be taken that
the planting material is purchased from authentic and certified nurseries. The supplier should
have the details like age of the plant, variety of the cashew, rootstock used etc. and the same
should be mentioned in the bill/ cash receipt.
6.4 Preparation of Land
The land should be ploughed thoroughly and levelled in case of agricultural lands. In case of
forestlands, the jungle should be cleared well in advance and the debris burnt. After clearing
the jungles, land is to be terraced or bunds constructed on sloppy land. In order to ensure
better moisture conservation, soil trenches are dug across the contours. The cost of land
preparation will vary depending upon the type and method of soil working. Nowadays, use of
JCB for soil working is most popular; hence a provision for use of soil working is made in the
model. The land preparation work should be completed prior to the onset of monsoon season
i.e. during May – June.
6.5 Layout
Cashew trees are generally planted with a spacing of 7 to 9 meters adopting square system. A
spacing of 7.5 m X 7.5 m (175 plants/ ha) or 8 m X 8 m (156 plants/ ha) is recommended. High
density planting of cashew at a closer spacing of 4 m X 4 m (625 plants/ ha) in the beginning
and thinning out

18
in stages to maintain a final spacing of 8 m X 8 m in the tenth year is also recommended. This
enables higher returns during initial years. In case of sloppy lands, the triangular system of
planting is recommended to accommodate 15 per cent more plants without affecting the
growth and development of the trees. In undulating areas, the planting should preferably be
done along the contours, with cradle pits or trenches provided at requisite spacing in a
staggered manner to arrest soil erosion and help moisture conservation.
6.6 Digging and filling of pits
The work of digging of pits has to be completed much in advance (May – June). Cashew can
be planted in pits of 60cm x 60cm x 60cm size in soils with normal strata. In hard lateritic
soils, pits of 1m x 1m x 1m size are recommended. The top soil and sub-soil are kept separately
and allowed to wither under sun. It helps in migration of termites and ants. Burning of the
debris and forest wastes inside the pits before planting is advantageous. The pits are then filled
with topsoil mixed with farmyard manure or compost (5 kg) or poultry manure (2 kg) and rock
phosphate (200 g). In order to mitigate soil borne diseases, BHC @ 100g/ pit is also added to
the soil mixture.
6.7 Planting
The grafted plants obtained from the superior mother plant are usually planted at the onset of
monsoon. It is essential to provide stakes and temporary shade with the locally available
materials wherever necessary (especially in the South West aspects in case of forest plantation)
to reduce the mortality rate and achieve quicker establishment. If the monsoon rains are
inadequate, one or two pot irrigation can be done during the initial stages to ensure
establishment.
Planting distance
Planting distances of 8 x 5 m is recommended. The trees grow vigorously in the first 3 years
and as soon as the crowns touch each other alternate trees should be removed until the
permanent planting distance of 10 to 12 m is reached. Branches hanging on the ground should
be removed because they interfere with harvesting. In other parts of the world cashew trees
bear well, in spite of the little attention devoted to the orchards.

19
6.8 Mulching
The cashew is generally planted on the wastelands and hence availability of soil moisture is
always low, hence, mulching is essential. Mulching with black polythene is beneficial to
increase the growth and yield of cashew. However, locally available materials like green or dry
grass or weeds can be utilized for mulching the basins. Small pebbles or stones can also be
used for mulching of the basin. The plastic or stone mulch does not improve soil health but
ensures better moisture retention in the soil and also prevents attack of soil borne insects and
pests.
6.9 Manuring and fertilization
In our country, application of manures and fertilizers is very limited in the case of Cashew. In
order to get better yield, it is essential to maintain adequate N:P:K ratio in the soil.
Application of 10-15 kg of farmyard manure per plant is recommended to ensure adequate
organic matter in the soil. The fertilizers recommended for a mature cashew tree are 500 g N
(1.1 kg urea), 125 g P2O5 (750 g Single Super Phosphate and 125 g K2O (200 g muriate of
potash). The nutritional requirements and the quantity of fertilizer per plant are given in
Table 2.
The ideal time for application of fertilizer is immediately after the cessation of heavy rains.
Fertilisers should be applied in a circular trench along the drip line. Before application of
fertilizer it should be ensured that there is adequate soil moisture. The fertilizers should be
applied in two split doses during pre-monsoon (May – June) and post monsoon (September –
October) season. However, in the case of single application, it should be done during post
monsoon season (September – October) when adequate soil moisture is available. In sandy and
laterite soils, soils of sloppy land and in heavy rainfall zones, the fertilizer application should be
done in a circular trench of 25 cm width and 15 cm depth at 1.5m from the tree trunk. In red
loamy soils and in low rainfall areas (east coast), the fertilizers should be applied in circular
bands at a distance of 0.5m, 0.7m, 1.0m and 1.5m away from the trunk during first, second,
third and fourth year onwards of planting, respectively.

20
Fig 4. Nutritional requirements and recommended fertilizer doses for cashew
Age Urea (g) SSP (g) MOP (g)
1 st Year 375 275 75
2 nd
year
750 525 150
3 rd
year
1100 750 200

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6.10 Weeding
Weeding with a light digging should preferably be done before the end of rainy reason. Hoeing,
cutting the weeds off underground is more effective than slashing. Chemical weeding has not
been of any importance until now, however it may be considered as an alternative, where
wages are high or where there is shortage of labour. Initially, Agrodar-96 (2, 4 –D) @4ml/litre
of water and subsequently Gramaxone @5ml/litre of water is sprayed. Approximately, 400
litre/ha (160 litre/acre) of solution is required per spray. The spray is again repeated in the
post monsoon season.
6.11 Inter-cropping
Tall growing intercrops like certain varieties of sorghum and millet should not be encouraged
between young cashews, as they provide too much shade. Leguminous crops such as
groundnut and beans are very suitable for inter cropping. Besides the annual crops, arid zone
fruit crops having less canopy especially annona, phalsa, etc., can be thought of, depending on
the suitability. Cultivation of horse gram, cowpea, groundnut etc is recommended as inter-
crops in cashew. Inter cropping cashew, Casuarina and coconut are popular.
6.12 Cover Cropping
Leguminous cover enriches soil with the plant nutrients and adds organic matter, prevent soil
erosion and conserves moisture. The seeds of these cover crops may be sown in the beginning of
rainy season. The seed beds of 30cm X 30cm size are prepared in the interspace in slopes by
loosening soil and mixing a little quantity of compost. The seeds of these crops are sown in the
beds and covered with a thin layer of soil. The seeds should be soaked in the water for six hours
before sowing.
6.13 Training and Pruning
During first year of planting, the sprouts coming from the rootstock should be removed
frequently to ensure better health of the plant. These sprouts eat up valuable plant nutrition
and also cause death of grafted scion allowing only rootstock to grow. Initial, training and
pruning of cashew plants during first 3-4 years is essential for providing proper shape to the
trees. The trees are shaped by removing lower branches and water shoots coming from the
base during first 3-4 years. Thereafter, little or no pruning is necessary. The plant should be
allowed to grow by maintaining a single stem up to 0.75-1.0 m from the ground level. Weak
and criss-cross branches are also chopped off. In order to avoid lodging of the plant by wind,

22
proper staking of plant is essential. After 4-5 years, the main stem is detopped to a height of
4-5 m from the ground level. Thereafter, regular removal of dried/ dead wood, criss-cross
branches and water shoots once in 2-3 year is done to keep the plant healthy. The training and
pruning of cashew plants is done during August – September. The cut surfaces are smeared
with Bordeaux paste.
The flowers appearing during first and second year of planting should be removed (de-
blossoming) and plants should be allowed to bear fruits only after third year.
6.14 Top working
Better management practices may increase the yields marginally but boosting cashew
production 3-4 folds in a short span of time is perhaps possible only by "genetic
transformation" of the existing plantations with high yielding varieties. It is reported that this
genetic transformation can be effected through top working. The rejuvenation of unthrift
cashew plantations through top working involves beheading of trees, allowing juvenile shoots
to start-out and taking up of in-situ grafting using procured scions of high yielding varieties.
Periods from November to March and February to June have been found to be ideal for
beheading and in-situ grafting respectively. It has been observed that the top worked trees
within a period of two years have not only put forth a canopy of 3-4 m in diameter and 5-6 m
in height (as that of 8-10 year old trees) but also have given an yield of 3 to 5 kg nuts per tree
in their first bearing itself.

23
From research, the number of cashew production plus processing company in Ogun state is
two, this also serve as added advantage for Tabgate Agro Allied Ltd in having more market
accessibility.

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6.15 PEST AND DISEASES
It is observed that there are about 30 species of insects infesting cashew. Out of these tea
mosquito, flower thrips, stem and root borer and fruit and nut borer are the major pests,
which are reported to cause around 30% loss in yield.
Tea Mosquito
The nymphs and the adults of tea mosquito (Helopeltis spp.) suck sap on the tender leaves,
shoots and inflorescence and even young nuts and apples. The saliva of the insect is very toxic,
which causes blistering at the site of infestation. Severe attack on the young shoots cause
dieback. Attacked inflorescence usually can be recognised from a distance by their scorched
appearance. Tea mosquito population builds up during the beginning of the rainy season,
when the cashew tree is full of new flush.
Tea mosquito can be controlled by spraying carbaryl 0.1.% or phosalone 0.07% or dimethoate
0.05%. Spraying should be done thrice, first at the time of flushing, second at early flowering
and third at the time of fruit set.
Thrips
Both nymphs and adults suck and scrape at the underside of the leaves, mainly along main
veins, causing yellowish patches, latter turning grey, giving the leaves a silvery appearance.
The thrips are more active during the dry season. 0.05% monocrotophos or 0.1% carbaryl are
very effective for controlling thrips.
Stem and Root Borers
The young white grubs bore into the fresh tissues of the bark of the trunk and roots and feed
on the subsequent subepidermal tissues and make tunnels in irregular directions. Due to
severe damage to the vascular tissue the sap flow is arrested and the stem is weakened. The
characteristic symptoms of damage include the presence of small holes in the collar region,
gummosis, yellowing and shedding of the leaves and drying of the twigs. Once the plant is
infested complete control of this pest is very difficult. However, prophylactic measures for its
control can be adopted with 0.1% BHC swabbing twice a year, once in April-May and the
second application during November.
Fruit and Nut Borers
The young caterpillar bores through the apple and nut causing deformity and /or loss of kernel
weight. Spraying of monocrotophos - 0.05% concentration at flowering and fruit setting is
recommended.

25
Diseases
Fortunately cashew crop does not have any serious disease problem except the powdery
mildew caused by a fungus, which affects the young twigs and inflorescence and makes it
wither. This disease generally appears when the weather becomes cloudy. Control can be
obtained by dusting with 2% Sulphur W.P.
6.16 Harvesting and Yield
Cashew plants start bearing after three years of planting and reach full bearing during tenth
year and continue giving remunerative yields for another 20 years. The cashew nuts are
harvested during February – May. Normally, harvesting consists of picking of nuts that have
dropped to the ground after maturing. However, if the apples are also used for making jam,
juice, syrup, Fenni, etc., the fruit has to be harvested before it falls naturally. The cashew apples
are removed and the nuts are dried in sun for 2-3 days to bring the moisture level from 25 per
cent to 9 per cent. The maturity of the cashew nut is tested by floatation method. The mature
nuts sink in water while the immature/ unfilled ones float. The nuts are collected at weekly
intervals from the farm during the harvesting season. During that period the land should be
clean in order to facilitate collection of cashew. Plantations of unknown origin or seedling
progenies with conventional methods of cultivation yield less than one kg of raw nuts per tree.
However, there is a chance to increase the yield up to 4 to 5 kg per tree with the adoption of
improved production techniques, over a period of 4 to 5 years. In new plantations, with the
use of elite planting material coupled with a package of improved agronomic practices, a yield
of 8-10 kg per tree could be achieved.
6.17 Processing
The processing of cashew involves the following steps:
- Preliminary cleaning
- Roasting
- Shelling and separation
- Drying
- Peeling

26
Preliminary cleaning of cashew nuts is done by manual picking of large objects and by
sieving. Processing
The objective of cashew processing is to extract the healthy, tasty kernel from the raw nut in
the shell. Most modern factories are designed to obtain the maximum number of whole nuts
and as much shell oil as possible. Processing can be subdivided into a series of steps.
Drying
Harvested nuts are dried in the sun for a few days. Properly dried nuts can be stored for 2 years
before being shelled. Nuts are roasted to discharge the caustic shell oil and acrid fumes. Hand
shelling is impossible if the shell oil has not been removed previously. Kernels must be
protected from contamination by the shell oil because it would cause blisters in the mouth and
throat when eaten. Before the nuts are roasted they must be soaked in water—the moisture in
the shell facilitates the rupturing of the cells containing shell oil and retaining it in the shell.
Moisture makes the kernel slightly rubbery and limits breakage of the kernels. The easiest
method to wet the shells is to heap the nuts into big piles and to use sprinklers intermittently.
Steam may also be used.
The simplest roasting method is to heat the nuts for about a minute in an open pan with holes.
Acid fumes are released and if the nuts should catch fire the flames can be doused with water.
A more efficient method is to use a slanting perforated cylinder that is rotated above a fire. The
shell oil flows through the holes in the cylinder and is collected in a catch through. After the
roasting process the nuts are dumped into ash or sawdust to remove the excess shell oil still
clinging to the shells.
Shelling
This is the most difficult operation in cashew processing. In India shelling is mostly done by
cheap female labour. Shelling is carried out by using special wooden mallets and pieces of bent
wire, at a rate of about 200 nuts per hour.
Mechanical shelling methods are difficult to design because of the irregular shape of the nut,
hardness of the shell and brittleness of the kernel. In some mechanical processing plants
compressed air is used to crack the nuts. The latest Windmer and Ernst method is to cut a
groove around the shell and to place the shells in a modified centrifuge fitted with metal plates.
The nuts are thrown against the plates and cracked by centrifugal forces when the machine
spins. It is possible to obtain 85 % whole kernels with this method.

27
Removal of the testa
Before the thin, papery seed coat (testa) can be removed, the kernels must be dried. Nuts are
dried on big racks in an oven at 70 °c. The testa becomes dry and brittle and is easily removed.
The remaining traces of membrane are removed with bamboo knives. Modern factories use
electronic machines to detect nuts with pieces of remaining testa which are then sorted and
cleaned by hand.
Grading
Kernels, whole and broken, are sorted into 6 grading schedules. There is only a small demand
for broken or dark and unevenly roasted kernels.
Packaging
Kernels are dried to 3 % moisture content before they are packed.
Drying is necessary to extend shelf life and prevent fungal and other infections.
Dried kernels do not become rancid.
Nut kernels of export quality are vacuum packed in tins. Grading and Packing
Grading is done for export purposes based on "counts" or number of kernels per pound. Sound
kernels are named as "wholes" and broken ones as "splits". The wholes are again classified as
whole white kernels, whole scorched kernels, whole dessert kernels (a) and whole dessert
kernels (b). The splits are also further graded into white pieces, scorched pieces, dessert pieces
(a) and dessert pieces (b) based on certain physical characters. The wholes are packed in
several grades viz., 210, 240, 280, 320, 400, 459 and 500; the popular grade is 320. The
specifications for graded kernels are that they should be fully developed, ivory white in colour
and should be free from insect damage and black and brown spots. Packing is done in time by
Vita pack method (exhausting the air inside the packing tin, pumping in carbon dioxide and
sealing).

28
Fig 6. CASHEW NUT PROCESSING FLOW CHART
The techno-economic parameters for the model project are detailed in Annexure I.

29
6.19 CASHEW JUICE PRODUCTION PROCESS
Ingredients:
1. Cashews fruit
2. Sweetened condensed milk (Optional – Do not use if you want to go natural)
3. Vanilla extract flavoring (Optional – Do not use if you want to go natural)
4. Water
5. Sorbic acid - PRESERVATIVE
6. Benzoic acid - PRESERVATIVE
7. Packaging materials. Sterilized bottles were used and sterilized equipment
PROCESS
 Wash the cashew fruit and remove the nut
 Cut up the fruit into cubes (be careful not to get the fruit on your clothing as it stains)
 Put the fruit in a blender with the water
 Pour the juice through a strainer into a container. Discard the fiber left in the strainer.
 Add the sweetened condensed milk and vanilla extract flavoring to the container (this step
is optional as you can go natural).
 Add the preservatives
 Mix the juice.
 Fill into pet bottle
 Store in Cold freezer.
ANALYSIS ON THE CASHEW JUICE
For the purpose of NAFDAC registration and obtaining cGMP the following test are necessary to
be carry out on each batch of production.
Determination of pH of the Cashew Juice
 Determination of the Cashew Juice Colour
 Determination of the Specific Gravity of the Juice
 Determination of Total Soluble Solids (Brix Level) of the Cashew Juice
 Determination of Titratable Acidity of the Fruit Juice.
 Determination of the Microbial Counts of the Fruit Juice.
 Sensory Evaluation
LABORATORY ANALYSIS TEST FOR FOOD AND FRUIT PRODUCTS
The quality analysis can be outsource to the following parastatal to obtain regulatory certification.
NISLT: Nigerian Institute of Science Laboratory Technology: https://nislt.gov.ng/aboutus.php
IPAN: The Institute of Public Analysts of Nigeria (IPAN):
http://www.ipan.gov.ng/vision&mission.php

30
FIRRO : The Federal Institute of Industrial Research, Oshodi (FIIRO) is a parastatal under the
agency of the Federal Ministry of Science and Technology.: http://www.fiiro.org/
Figure 8. The production flow diagram of cashew juice processing, using different preservation
methods

31
6.19 Cashew Nut Processing Business Plan – SWOT Analysis
In our bid to ensure that we run a standard cashew nuts processing business, we have engaged
the services of the finest business consultant here in Ogun to look through our business concept
and determine how best suited we are to not only run a standard cashew nuts processing business
but to also favourably compete with other similar businesses as well.
Due to this we have taken stock of our strengths, weaknesses, opportunities and threats and used
this to understand how we are likely to survive not only in our industry here in Ogun but also all
over Federal Republic of Nigeria as well. The result we got after conducting the SWOT analysis for
TABGATE AGRO ALLIED LTD;
 Strengths
Our strength lies in the fact that the cashew nuts we process are organic which will be able to
meet the dietary needs of our various clients. We have the best equipment in place that will be
able to handle a large batch of processing without getting spoilt.
We have the best preservation unit that will see our nuts lasting as long as possible without going
bad. Our employees are the best in the field and have the experience necessary to ensure that we
achieve all our corporate goals and objectives. Finally, our Chief Executive Officer has vast
experience and the necessary expertise that will ensure that we achieve all that we set out to.
 Weaknesses
We are a new company and as such do not have the necessary finance and staff strength needed
to compete against already established cashew nuts processing businesses, which means that it
will be hard for us to break into the industry here in Abeokuta and all over Nigeria. We however
have plans in place that will help us overcome this.
 Opportunities
There are several opportunities available to us in this industry as there are lots of people who
understand the dietary benefits of cashew nuts and are convincing others to consume cashew
nuts.
 Threats
Every business faces threats every now and then and so the arrival of a new competitor to our
same location, offering the same services is a threat as well as stringent government policies
regarding the agro processing industry.
6.20 Generating Funding/Startup Capital for Cashew Nuts Business
TABGATE AGRO ALLIED LTD is a business owned and run by Mr Femi and his immediate
family members. The capital sourcing are just three major sources.
Therefore the areas where we intend generating our start-up capital from are;
 Getting part of the capital from personal savings
 Sourcing for soft loans from family members
 Applying for loan from the bank

32
Cashew Nut Processing Business Plan – Sustainability and Expansion Strategy
We know how valuable how customers are to us because without them we will not be able to
generate the needed revenue that will not only sustain our business but allow us grow and expand
at the pace we want. Due to this we intend to give our customers’ utmost priority especially when
it comes to ensuring that accurate orders get to the right destination and that complaints if any
are handled as quickly as possible.
Customers want to know that a brand not only listens to them but acts also. We will also give out
incentives every once in a while to all our loyal customers and have loyalty discount programs in
place for those who refer us to others.
Finally, we intend to ensure that we retain a certain percentage of our earnings back into our
capital base. This will ensure that we have a sustained bottom line that will allow us run our
business and also expand it when we deem fit. These strategies we have listed will be enough to
boost and expand our cashew nut processing business.
7. MARKETING PLAN
Therefore, the marketing and sales strategies that we intend to adopt at Tabgate Agro Allied Ltd.
in selling and marketing our business are;
 Ensure that we introduce our cashew processing nuts business formally to high level and
corporate clients as well as other stakeholders in the industry
 Throw a unique party before declaring the business open, to generate interest amongst our
target market
 Place advertisements in local newspapers and food and lifestyle magazines as well as on
local radio and television stations
 Use our social media platforms such as Facebook, Twitter and Instagram to market and
sell our processed cashew nuts
 Ensure that we are listed in yellow pages as well as on online directories
 Engage in direct marketing to all our clients

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8. EXAMINATION OF RISKS AND PROBLEMS
Challenges and Opportunities within the Cashew Sector and Value Chain
The cashew value chain is complex and presents a number of opportunities for farmers and
investors to take advantage of. Some of the current challenges in the Nigeria cashew industry are:
RISK/PROBLEMS SOLUTION
Pricing challenges – the variance between pricing
offered by middlemen relative to prevailing
international prices.
The price tag for Tabgate Cashew
nuts and juice is lower than the
market price. This will give the
brand products an avenue to sell
faster than others.
Marketing challenges – lack of official cashew
buying centers in the Nigeria.
From the market analysis we have
create a marketing plan such has
email marketing, social marketing,
and agricultural event management
on cashew plantation to drive the
product all over the nation.
Insufficient and expensive transportation from
rural farming areas to the urban areas.
Tangate Agro Allied Ltd has been
located in a very strategic place
which makes it more accessible and
motor able.
Inadequate processing facilities. Our business plan has cover the list
of equipment required in the
complete processing of both cashew
nuts and its pulp juice.
Challenges with farm perimeter fencing and the
encroachment by grazing livestock.
To address this challenges we have
put 4 security officer in a strategic
post of the farm who ensure and
control theft and animal
encroachment.
Lack of quality testing laboratories, and experts to
man them.
The challenges of quality control test
is address by contracting the sample
of the product to IPAN member and
NAFDAC for regulatory approval.

34
Lack of storage and drying facilities at the farm
level.
The drying facilities has been
captured in these study.
The maturing period for cashew is too long for
some farmers to consider entering the market.
The time frame for harvest had been
considered in this study to ensure
that the income generated in the
third year = profit+ fixed assets +
Running Cost
Threat of bush fires The location of the farm will not
allow fire threat and also burning of
refuse are prohibited in and around
the farm.
In addition assurance has been put
in place to ensure assets lost by
accident can be reclaim.
Inadequate extension services supporting the
cashew VC
The National Cashew Association of
Nigeria (NCAN), this organization
has come up in giving necessary and
technical advice to farmers and
investors who have interest in
cashew plantation.
Lack of adequate processing done on the cashew
apple.
Our study have provide the best way
of processing cashew apple which
will make it edible for consumption.
Lack of boreholes for watering at the farm level Four bole has been designed along
this research to solve the irrigation
problem
Lack of effective Agricultural Research Centers and
Extension Services to provide advisory services on
diseases, pests, and worms.
The National Cashew Association of
Nigeria (NCAN), this organization
has come up in giving necessary and
technical advice to farmers and
investors who have interest in
cashew plantation.
Inadequate community sensitization on the
benefits of cashew farming.
This has been address in the
marketing plan. We are to create
public awareness on the benefits of
consuming cashew nuts and juice.

35
Lack of availability of seeds/seedlings. Our market research as provide
standard organization that can
supply seeds/seedling at a very
affordable price.
Some of the above challenges cut across the Value Chain and which when addressed
through the requisite investments would create wealth creation opportunities. The cross-
cutting challenges cum opportunities are:
 Marketing challenges – lack of official cashew buying centers in the Nigeria.
 No processing facilities
 Farmers and technicians in need of best practices training.
 No processing done on the cashew apple.
 Insufficient and expensive transportation from rural farming areas to urban areas.
 Lack of storage and drying facilities at the farm level
The above 6 challenges represent investment opportunities that would not only go a long way in
helping to improve operational standards of the industry, but would also help the value chain to
realize the wealth generation opportunities that have long been associated with cashew.

36
9. FINANCIAL AND ECONOMIC PLANS
9.1 BUSINESS EVALUATION OF FARM/FINANCE
This evaluation is based on Cashew nuts and Juice
 Start–Up Expenditure (Budget)
When starting a cashew nut processing business, there are certain aspects where one is expected
to spend the bulk of the generated capital on, and most of the bulk of this capital is usually used
for stuffs that are majorly under overhead expenses like renting a facility, procuring equipment
and getting a vehicle. Others may be running expenses such as paying the salaries of employees as
well as utility bills.
LAND CHARGE`S ANALYSIS
100 Hectare/Year 10 Years Cost
1 Annual Land Rent
(5,000/Hactre)
₦ 500,000 ₦ 5,000,000
2 Payable Fee of Submission Point ₦ 50,000
3 Crop Remuneration Service
Charge(2000/Hactre)
₦ 200,000 ₦ 12,000,000
Land Clearing charges ₦ 1,200,000 ₦ 12,000,000
TOTAL COST OF LAND UTILIZATION FOR 10 YEARS
₦29,050,000

37
Fig 9. The key areas where we will be spending our start-up capital on are;
No ITEMS/MATERIALS COST
FIXED COST OPERATIONAL COST
3 Year Projection
1 Total fee for registering the business in Nigeria– ₦120,000 N/A
2 Obtaining of licenses and permits as well as accounting
software and other legal expenses are –
₦250,000 N/A
3 Cost of hiring a business consultant – ₦55,000 N/A
4 Insurance coverage (general liability, workers’
compensation and equipment insurance) –
₦10,500,000 N/A
5 Marketing promotion expenses – for general marketing
expenses as well as for the grand opening of TABGATE
AGRO ALLIED LTD –
₦3,050,000 N/A
6 Operational cost for the first 36 months (paying of
employee salaries) –
N/A N14,400,000
7 Cost of start-up inventory (raw cashew nuts, Fertilizer
and packaging materials) –
₦10,000,000 N/A
8 Cost of Generator Perkins Soundproof Generator-
30KVA–
₦ 2,303,000 N/A
9 Cost of administrative expenses (stationery, phones,
computers and furniture) –
₦1,500,000 N/A
10 Cost of storage hardware (rack, preservation unit,
shelves and bins) –
₦5,000,000 N/A
11 Cost of purchasing store equipment (cash register,
ventilation and signage) –
₦600,000 N/A
12 Cost of purchasing a distribution/delivery van – ₦14,235,000 N/A
13 Cost of leasing a facility for at least TEN years and
carrying out renovations –
₦29,050,000 N/A
14 Cost of launching an interactive website – ₦240,000 N/A
15 Cashew Shelling Machine – ₦684,000 N/A
16 Dehydrator Machine- ₦ 300,000 N/A
17 4Bore Hole plus Water running – Irrigation system ₦5,000,000 N/A
18 Sumec Chest Deep Freezer –SF-250C-3years Warranty ₦ 77,000 N/A
19 Jam Agitator Juice Blending Mixing Machine for juice
US $3,000-9,000/ Set Guangzhou Lianhe Machinery
Co., Ltd.
₦3,285,000 N/A
20 Juice Packaging Bottle and Labels (50N/bottle) N/A ₦89,250,000
21 Cost of 3 bedroom Flat with production space ₦20,000,000
22 Diesel and Utility Bill N/A ₦10,000,000
23 Land Preparation N/A N1,500,000
24 Miscellaneous – N/A ₦1,000,000
₦106,249,000 ₦116,150,000
TOTAL ESTIMATED EXPENDITURE ₦222,399,000.00K
From the above break down, it is obvious that we need the sum of ₦222,399,000.00K in order
to start and run our cashew nut processing business successfully here in Abeokuta Nigeria. The
bulk of the sum will be going into paying of salaries and utility bills for at least 36months,
purchasing a delivery van, leasing a facility and also getting the necessary equipment that will be
used to run the business and get the cashew juice and nuts processed.

38
9.2 Financial Viability and Bankability
Project Cost
The cashew tree starts bearing during third year but the income is not sufficient to cover the
expenses. Hence, the cost of development up to third year is capitalized. The project cost
estimated for hundred ha of cashew plantation is and the details are presented in fig 9.
Annexure I : Techno-economic parameters
Spacing 7.5 m x 7.5 m
Varieties Vengurla 4, 6 & 7
Planting Material Grafts/Seedlings
Plant Population (plants/ha) 750
Land preparation (Naira./ha) 15000.00
Labour (Naira./manday) 1500.00
Planting material (N./plant) 200.00
Farm Yard Manure (N./MT) 1200.00
Urea (N./kg) 5.70
Single Super Phosphate (N./kg) 5.80
Muriate of Potash(N./kg) 16.60
Plant protection material (N./litre) 300.00
Sale price of Cashewnut (N./kg) 3000.00

39
Fig 9.1 TARGET SALES INCOME PRJECTION FOR CASHEW NUTS
FACTORS COST Calculation in weight Expected
weight in
Tonnes
Sales Price
estimate
Number of Estimated
Cashew Trees
Estimated number of
Fruits 357 fruits/tree
Average weight of a
cashew nut is 9g
2.2Million Naira/Ton
One Plot of
land
20 trees 7140 fruits 499996g
One Acre of
Land
20* 6 = 120 trees 42,840 fruits 29999760g
One hectare of
land
2.5 * 120 = 300
trees
107,100 fruits 74999400g
Hundred
hectares
300*100=30,000
trees
10,710,000 fruits 96,390,000g 96.39
Tonnes
₦212,058,000
Fig 9.2 TARGET SALES INCOME PROJECTION FOR CASHEW JUICE
FACTORS COST 6pcs/75cl
bottle
Market
Price
Sales Price
Number of Estimated
Cashew Trees
Estimated number of
Fruits 357 fruits/tree
6pcs/75cl
bottle
N/A ₦60/bottle
One Plot of land 20 trees 7140 fruits 1488 N/A ₦89,280
One Acre of Land 20* 6 = 120
trees
42,840 fruits 7140 N/A ₦535,500
One hectare of land 2.5 * 120 = 300
trees
107,100 fruits 17850 N/A ₦1,231,620
Hundred hectares 300*100=30,00
0 trees
10,710,000 fruits 1,785,000 N/A ₦107,100,000
Fig 9.3 TOTAL SALES REVENUE
3RD YEAR FOURTH YEAR FIFTH YEAR SIXTH YEAR
NUTS JUICE NUTS JUICE NUTS JUICE NUTS JUICE
₦212,058,000 ₦107,100,000 ₦212,058,000 ₦107,100,000 ₦212,058,000 ₦107,100,000 ₦212,058,000 ₦107,100,000
EXPECTED PROFIT YEARLY
1 2 3 4 5 6
Sales
Revenue
N/A N/A ₦319,158,000 ₦319,158,000 ₦319,158,000 ₦319,158,000
Total
expenditure
₦179,219,833.34K ₦43,179,166.66k ₦222,399,000.00k ₦43,179,166.66k ₦43,179,166.66k ₦43,179,166.66k
Yearly Profit N/A N/A ₦96,759,000 ₦275, 978,834.00K ₦275, 978,834.00K ₦275, 978,834.00K

40
9.3 By-products –For future investment
Shell oil represents about a quarter of the mass of an unshelled nut and approximately equal to that
of the kernel. This fluid, that is not an oil as the term "shell oil" indicates, but a mixture of anacardic
acid and cardol is the main by-product.
There are more than 200 registered patents of different uses of shell oil. One of the most important
uses is in the manufacture of brake linings. Shell oil is used in the manufacture of numerous
materials that have to be resistant to heat, friction, acids and caustic products, for example clutch
plates, special isolators, varnish and plastic materials. The wood is insect repellent and used in
making book cases and packing crates. The gum is a replacement for gum arabic and used as insect
repellent glue in book bindings. In the nut and the apple, a compound has been found that combats
tooth decay.
The apple is highly perishable but very healthy. It can be eaten fresh or juiced. Syrup, wine, brandy,
gin, preserved fruit, pickles and glazed fruit are also made from the cashew apple. In Brazil, fresh
cashew-apples are packed in trays and marketed in retail fresh produce outlets.
The indigenous people in cashew-producing regions use different parts of the plant such as the
leaves, bark, gum, wood, juice and roots for the preparation of local medicines or insect-repellent
mixtures. The bark is rich in tannins and is used in leather tanning. The papery seed coat around
the kernel can serve as cattle feed.
9.4 Exports opportunity
India earns more than 200 million dollars a year by exporting 40 to 50 thousand tonnes of cashew
kernels and the country's trade links are spread over 40 countries. Cashew is a craze in the United
States which is
by far the largest buyer. The other major purchasers are the eec countries, Japan, Australia,
Canada, Hong Kong, Singapore and the countries in the Middle East. Cashew is an excellent choice
to grow around the house as a shade tree with healthy fruit (apple) and nuts.
Nuts determined the eating habits of prehistoric people. Along with berries and brook water, nuts
followed humanity to civilisation. Cashew nuts are packed with proteins, fats and vitamins to a high
degree.
Proteins, the tissue builders in our system, constitutes a large proportion of cashew contents. The
cashew kernel contains 21 % of vegetable protein. Nutritionally they stand on a par with milk, eggs
and meat. It also contains a high concentration of much-needed amino acids.

41
Funding
Agricultural Credit
Agric. Credit Guarantee Scheme Fund | Agric. Credit Support Scheme
Claims Settlement Activities
Agricultural Credit Guarantee Scheme Fund (ACGSF)
The ACGSF was established by Decree No. 20 of 1977, and started operations in April, 1978. Its original
share capital and paid-up capital were N100 million and N85.6 million, respectively. The Federal
Government holds 60% and the Central Bank of Nigeria, 40% of the shares. The capital base of the
Scheme was increased to N3 billion in March, 2001. The Fund guarantees credit facilities extended to
farmers by banks up to 75% of the amount in default net of any security realized. The Fund is managed by
the Central Bank of Nigeria, which handles the day-to-day operations of the Scheme. The
Guidelines stipulate the eligible enterprises for which guarantees could be issued under the Scheme.
Between 1978 and 1989 when the government stipulated lending quotas for banks under the Scheme,
there was consistent increase in the lending portfolios of banks to agriculture, but after the deregulation of
the financial system, banks started shying away by reducing their loans to the sector due to the perceived
risk. In order to reverse the declining trend several innovations and products were introduced under the
Scheme such as:
 the Self-Help Group Linkage Banking,
 Trust Fund Model and
 Interest Draw Back .
Application forms under the Scheme are obtainable from various branches of participating banks
throughout the country. The various forms normally completed in the operation of the Scheme by banks
can be downloaded from the list below:
1. Application for credit facilities
2. Application for Guarantee
3. Application for Enhancement
4. Application for Extension
5. Notice of Default
6. Guarantee Claims; and
7. Annual Returns
Agricultural Credit Support Scheme (ACSS)
The ACSS is an initiative of the Federal Government and the Central Bank of Nigeria with the active
support and participation of the Bankers� Committee. The Scheme has a prescribed fund of N50.0billion.
ACSS was introduced to enable farmers exploit the untapped potentials of Nigeria�s agricultural sector,
reduce inflation, lower the cost of agricultural production (i. e. food items), generate surplus for export,
increase Nigeria�s foreign earnings as well as diversify its revenue base. At national level, the scheme
operates through a Central Implementation Committee (CIC) while at the Federal Capital Territory (FCT)
and State levels, the Scheme operates through State Implementation Committees (SICs) instituted to
ensure that the objectives of the scheme is realized without hindrance.
To access loans under ACSS, applicants (practicing farmers and agro-allied entrepreneurs with means)
are encouraged to approach their banks for loan through the respective state chapters of farmers
associations and State Implementation Committees. However, large scale farmers are allowed under the
scheme to apply directly to the banks in accordance with the guidelines.
ACSS funds are disbursed to farmers and agro-allied entrepreneurs at a single-digit interest rate of 8.0
percent. At the commencement of the project support, banks will grant loans to qualified applicants at 14.0

42
per cent interest rate. Applicants who pay back their facilities on schedule are to enjoy a rebate of 6.0 per
cent, thus reducing the effective rate of interest to be paid by farmers to 8.0 per cent.
The Implementation Guidelines will be determined administratively as soon as a decision is taken on the
proposed fund.
Commercial Agriculture Credit Scheme (CACS)
As part of its developmental role, the Central Bank of Nigeria (CBN) in collaboration with the Federal
Ministry of Agriculture and Water Resources (FMA&WR) established the Commercial Agriculture Credit
Scheme (CACS) in 2009 to provide finance for the country�s agricultural value chain (production,
processing, storage and marketing). Increased production arising from the intervention would moderate
inflationary pressures and assist the Bank to achieve its goal of price stability in the country. The primary
objectives of the Scheme are to:
1. Fast-track the development of the agricultural sector of the Nigerian economy by providing credit facilities
to large-scale commercial farmers at a single digit interest rate;
2. Enhance national food security by increasing food supply and effecting lower agricultural produce and
products prices, thereby promoting low food inflation;
3. Reduce the cost of credit in agricultural production to enable farmers exploit the untapped potentials of the
sector; and
4. Increase output, generate employment, diversify Nigeria�s revenue base, raise the level of foreign
exchange earnings and provide input for manufacturing and processing on a sustainable basis.
The Scheme which is a sub�component of the Federal Government of Nigeria�s Commercial Agriculture
Development Programme (CADP) is financed through a N200billion Bond raised by the Debt Management
Office (DMO). Loans to eligible entities under the Scheme are disbursed at a maximum interest of 9
percent. The subsidy arising from this stipulated rate and the market rate on all loans granted, and the
administrative expenses of the Scheme are borne by the Central Bank of Nigeria (CBN).
The Central Bank of Nigeria and the Federal Ministry of Agriculture and Waters Resources jointly ensure
that the scheme is implemented successfully. This is achieved through the Project Steering Committee
(PSC) comprising the Honourable Minister of Agriculture and Water Resources (Chairman), the Governor
of the Central Bank of Nigeria, Representatives of the Federal Ministry of Finance and Commercial
Farmers, respectively and the Programme Coordinator of the Commercial Agriculture Development
Programme. The day-to-day implementation of the Scheme is undertaken by a Technical Implementation
Committee (TIC) made up of the Director of Development Finance Department, CBN as the Chairman,
Head of Agricultural Credit Support Division, CBN and a Consulting Group as members, and the
Programme Coordinator of the Commercial Agriculture Development Programme of the Federal
Government as the Secretary.
CACS is operated in two tranches of N100billion each. The 1st Phase of the tranche ran from May to
December, 2009, while the 2nd tranche commenced in February, 2010.
Detailed information on the operational modalities for the CACS are shown on the Guidelines for
Commercial Agricultural Credit Scheme while the performance of the Scheme are indicated in the Monthly
Report.
10.Conclusion
Cashewnut cultivation is a technically feasible, financially viable and bankable activity in
the areas identified suitable for it based on agro-climatic conditions.

43

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