YYTZ Agro-Processing is a cashew processing company based in Tanzania. YYTZ Agro has been working with rural cashew farmers in the Mtwara and Singida region to help them add value to their own crop and earn more income.
YYTZ’s flagship facility is located in Zanzibar, with a processing capacity of 2,500MT per annum. YYTZ recently won $500,000 from AGRA’s Africa Enterprise Challenge Fund competition. They are building a Cashew Farmer Processing Centre in Mtwara. The facility will have modern equipment and adequate storage facilities for farmers to use. Farmers are assured of a market, as YYTZ are the sole off-takers. The semi-processed cashews are purchased at a higher price; they are sent to Zanzibar for finishing before export to European markets. They provide GAP, food safety training in addition to financial literacy and business skills training for their farmer groups. By integrating them in the cashew value chain, the farmers will be able to earn more from their crop. By empowering farmers YYTZ can help alleviate poverty in rural Tanzania.
YYTZ is focused on building an inclusive cashew nut value chain in Africa; focusing on sustainability and traceability.
What was your inspiration to start your company?
I am a young Tanzanian entrepreneur. Growing up in Toronto, Canada, it was always a dream of mine to come back Tanzania and set up a business. After a visit to Tanzania in late 2012, I decided that I would explore opportunities in processing and value-addition. Tanzania is a very resource rich country, but like many in Africa it lacks local value addition.
I looked at Tanzania’s top traditional exports and learned that Tanzania is the fourth largest producer of cashew nuts in the world. Yet we are exporting 90% of our crop raw in-the-shell. Further more our crop is being processed in other countries and then re-exported to the developed markets. I saw this as an opportunity. I spent a lot of time travelling around rural Tanzania; meeting with farmers to understand the cashew sector. I practice a principle I learned from The Toyota Motor Corporation called genchi genbutsu; this means going to the source and seeing for your self. This thorough research helped me make informed decisions about our business. After the extensive research into the cashew nut sector, I concluded there was a real need for processing and value addition.
At the same time I learned that rural cashew farmers were not getting their fair share of the value from their cashews. I decided that I was going to focus on building an inclusive value chain; process cashews in Tanzania and integrate farmers into this value chain. I wanted to increase the income of my farmers by bringing them into the value chain and paying them more. The more value I can create in Tanzania, the more value I can pass on to the farmer. My goal is to transform the lives of rural farmers through an inclusive cashew nut value chain.
What’s the biggest achievement your company has had to date?
We have a farmer program in Singida region, one of the poorest regions in Tanzania. We are empowering rural smallholder farmers to start growing cashews. We provide them with training on Good Agricultural Practices, agronomy advice and all the tools to ensure that they are successful. We have taken a group of farmers for training at the Agricultural Research Institute. There they learned about cashew production, establishing a nursery, planting seedlings and disease control and prevention. By teaching these farmers how to fish, rather than giving them fish, we have supported them to establish a cashew nursery in their village. The Cashewnut Board of Tanzania provided us with the best hybrid seeds. The government then buys the seedlings from the farmers; so they have now created their own business. This season through this nursery we will distribute 67,000 seedlings to farmers in this area.
Once the farmers begin harvesting we will build our second Cashew Farmer Processing Centre in this area. Farmers will have access to storage units and will be able to use semi-automatic shelling machines to add value to their own crop. We then purchase the semi-processed cashews from them at a higher price. We are helping farmers to participate in the value addition and as a result earn more income.
To join our program we ask farmers to fill-in a registration form, where we also ask for feedback from farmers. Some of the feedback we get from farmers is they want to join the program because they feel they will be able to begin growing cashews and improve their lives and those of their children.
This is why we are in business. The why for us starts with the smallholder farmer. We are building a cashew value chain that includes smallholder farmers. Our goal is to uplift the lives of farmers through an inclusive cashew nut value chain. It is our goal to export a finished product that offers traceability to consumers and provides value to rural farmers. I want you to visit Singida region in 4-5 years and see a transformational change in the livelihood of the rural farmers in this area.
What industries and companies are you a threat to?
We are going to disrupt the way cashews are processed in Africa. We are interested in creating value and ensuring that value not only stays in Africa, but is also passed on to the farmer. This is paramount. We want to provide as much value to the farmer as possible. I think of the farmer as my customer, just as important, if not more important than my customers in Europe.
What’s the next big thing in your company?
With the current global nature of the cashew industry, there is more and more demand for traceability. Africa produces 60% of global cashew production, 90% is exported raw-in-shell to Vietnam and India for processing. Once it is processed, it is re-exported to the U.S. (largest importer of cashews) and Europe. The ability to provide traceability back to the farm is very difficult. By building an inclusive value chain in Africa, we are able to provide in-depth traceability to our discerning customers. This is becoming more important as consumers are demanding to know about the origin and sustainability of their food.