Economic Assessment Of The Warehouse Receipt System For Cashew Nut Marketing In Mtwara Region, Tanzania

ABSTRACT

The study to assess the economics of the Warehouse Receipts System (WRS) for cashew nut marketing was conducted in the Mtwara region, in southern Tanzania. Three districts namely: Masasi, Newala, and Nanyumbu were randomly selected. A cross-sectional survey was conducted to collect primary data from 90 farmers, 30 primary cooperative societies, three bank institutions, six exporters, six processors, and three input suppliers. Secondary data were secured from CBT, TANECU, MAMCU, MDC, NDC1 and NDC2. Descriptive and quantitative analytical techniques were employed. The findings indicate that the profit accrued from cashew nut marketing was highest for banks followed by processors and third exporters. Primary cooperative societies ranked fourth followed by input suppliers. The last were farmers. The profitability of cashew nuts between the key players was statistically significantly different (P < 0.05). The socio-economic factors: age of the farmer, size of the household labour, experience in cashew nut production, distance from the cashew nut farm, and the age of cashew nut trees were the factors affecting cashew nut profitability at farmer level and were statistically significant different (P < 0.05). Reasons behind the fact that the farm gate price is being paid in instalments were: little (65%) government guarantee, and high interest rates charged by the banks. Constraint impairing cashew nut marketing through the WRS was lack of training on the WRS to all key players. Thus, the study recommends training on the WRS should be provided to all key players to ensure their trust in the system. Moreover, the government should increase the guarantee to 100% so that the bank can reduce the interest rates and enable farmers to raise profit from cashew nut production.