DAR ES SALAAM, Nov. 9 (Xinhua) -- The government of Tanzania on Friday issued a four-day ultimatum to 35 private firms that have registered to buy cashew nuts to state in writing the amount of cashew nuts that they intended to buy this season.
"Failure to do so in four days beginning today (Friday) the government will revoke permits to buy cashew nuts that were given to the 35 firms," Prime Minister Kassim Majaliwa told a news conference in the capital Dodoma.
He said continued delay in buying the cash crop is making life difficult for cashew nuts farmers, something which the government will not tolerate.
Majaliwa said the current cashew nuts buying season witnessed low prices of the crop during a handful of auctions held in cashew nuts growing regions of Coast, Mtwara, Lindi and Ruvuma, forcing President John Magufuli to convene a meeting last week with buyers of the crop in which it was agreed that a kilogram of cashew nuts should be sold at 3,000 Tanzanian shillings (about 1.3 U.S. dollars) onward.
"It was an open discussion during the meeting and the buyers agreed to buy a kilogram of cashew nuts at 3,000 shillings onward. But after the meeting the buying of cashew nuts in auctions continued to be at snail's pace," Majaliwa said.
The prime minister said during the previous season, 300,000 tonnes of cashew nuts were harvested and that 200,000 tonnes of the crop are expected to be harvested during the current season.
On Thursday, Majaliwa told parliament that the government is seeking markets for cashew nuts abroad after the crop attracted low prices in the domestic market.
"The government is holding talks with various countries that can offer handsome prices for our cashew nuts," Majaliwa told the house in Dodoma.
"We are working hard to find reliable markets for cashew nuts as we did for tobacco and coffee," he said.
President Magufuli said last week the government is ready to buy cashew nuts from farmers if traders failed to buy the crop at handsome prices.
Magufuli said the government backed cashew nuts farmers who refused to sell their crop at between 1,900 shillings and 2,217 shillings a kilogram at a recent auction organized by buyers of the crop.
Cashew nuts growers in Mtwara, Ruvuma, Coast and Lindi regions have boycotted selling their crop at auctions, citing low prices.
The farmers enjoyed record high prices of up to 4,000 shillings a kilogram last season, but buyers were offering a maximum of 2,700 shillings a kilogram of the crop this season.
The new buying season started early this month but no trading has taken place due to the boycott, leading to fears that the disruption would affect the country's foreign exchange earnings.
International prices for cashew nuts have dropped by nearly half since March
Farmers in Cote d'Ivoire, the world's top cashew nuts producer with an output of 770,000 tonnes expected this year, were reported last month to have been struggling to sell their yields, with an estimated 150,000 tonnes lying around in warehouses.
