Abstract:
The study to assess the economics of the Warehouse Receipts System (WRS) for cashew
nut marketing was conducted in 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, NDC 1 and NDC 2 .
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.
