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Apr, 2017

How to Start a Cashew Nut Processing Unit

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In India, there are 8 states popular for the commercial cultivation of cashew, these are Andhra Pradesh, Goa, Kerala, Karnataka, Orissa, Maharashtra, Gujarat, and Tamil Nadu. Raw cashew is not a ready to eat product. Processing is necessary. And cashew processing unit is a small scale and profitable business in India.

Processed cashew nuts are consumed directly or converted to a variety of products like salted cashew nuts, kaju Burfi, cashew curries etc In India, processing of raw cashew nuts involves both effective utilization of latest technology through equipment and skilled labor.

Market Opportunity

India is a leading producer, processor, consumer, and exporter of cashew nuts in the world. It is one of the important agricultural commodities exported from India to many countries in the world. However, the local domestic market consumes about two third of cashew produced in the country. India accounts for 65 percent of total cashew nut exports in the world and export cashew to more than 60 countries. The Cashew Export Promotion Council of India (CEPCI) works towards the promotion of cashew nut and cashew nut shell liquid (CSLN). India produces 753,000 metric tons of raw cashew nuts per annum.

Business Registration and License

You will need to obtain various licenses to start a Cashew Processing Business. The license can be obtained from Government of India.

The license needed are as follows:

  • Registration under Shop establishment act (known as Gumatsa in Maharashtra)/ Trade License from Municipal Authority
  • VAT Certificate
  • Udyog Aadhar MSME online registration
  • FSSAI License (The processing units should follow the Food Safety and Standard Authority of India (FSSAI) act 2006. FSSAI Act is the applicable pan India for all food products. It prescribes minimum standards operating procedures, food safety norms, packaging & labeling norms.)
  • Trademark Registration (If you want to sell the Processed Cashews under your own Brand)

If you want to start a commercial cashew processing unit, then you must have knowledge about the machinery, processing, packaging etc.

Location & Machinery

There are 2 ways to do business:

  1. The entrepreneur can the grow the cashews by himself and use it for production. For this, he will need farming knowledge and background.
  2. The other way is to obtain the cashews by the farmers and Process it in the Plant or Factory.

The Cashew are mainly grown in the Southern region of the country like Konkan as it cannot withstand the extreme heat and extreme cold weather of the northern region. Therefore, setting up factory around a Cashew growing area will be in favor of the business as it will reduce transport cost, time and provide skilled labourers. However, help of transport can also be taken to get the raw cashew nut supply.

Following is the list of machines needed for the Processing Unit:

  • Steam Boiler
  • Cooking Vessels
  • Semi-automated Peeling Machine
  • Multi-color Cashew Kernel Sorting Machine
  • Husk Winnowing Machine
  • Steam Pipeline
  • Hot oven
  • Hand Operated Cutting Machine
  • Cashew Peeling Machine
  • cashew filling machine
  • Pieces separator
  • Weighing scale
  • Vacuum Packing / Sealing Machine
  • Food grade plastic tubs, buckets, crates, bowls
  • Diesel Generator Set

The prices of the machines may vary according to their Processing Capacity, Size, Features etc. Small scale industries can start with few used machines with low production capacity which will cost less.

Manufacturing Process

Step 1: Sun-Drying: The first step is sun-drying the raw cashews and store them in gunny bags.

Step 2: Steaming: Steaming the Raw Sundried Cashew is the next step, steaming the in-shell cashews under pressure helps in making the shell loose which makes the removing process easier.

Step 3: Removing the Cashew from the shell: Then the Cashew shells is spilt open longitudinally and the cashew inside is at once separated by hand.

Step 4: Oven-Drying: Once the cashew kernels are removed from their shells, it is dried in an Industrial oven at a low heat for a few hours to make the skin loose which eases the peeling process.

Step 5: Peeling: Then the outer skin which turns reddish after drying known as Testa is peeled off to obtain the final cashew nut after drying ready to be packaged.

Step 6: Grading the Processed Cashew nuts: Grading of Processed Cashew nuts is based on the color and the way the cashew kernels are broken. The grade is decided as per the AGMARK standards.

Step 7: Packing: Prefer to use equipment which can pack and seal cashew nuts hygienically through a Vacuum packing machine.

Approximately finished good produces is 1/4th of the raw material.

Raw Materials

The only Raw Materials needed for the Processing unit are Raw Cashews.

Cashew nuts growing season starts from Feb – May. At this time, usually RCN is procured and stored to be utilized through rest of the years. Therefore, this business in working capital intensive, as you need to buy raw material in bulk. One can also import RCN from other African countries and process and sell it, however, Konkan region cashew is hailed as the best is quality and taste.

Other Materials needed are packaging materials which are moisture-proof, air tight and of superior quality for packing the Processed Cashews.

Investment and Funding

RCN processing can be done at a very small scale also, where your minimum investment will be around 10 lakhs, which includes working capital and some essential equipment. E.g. you can start processing 0.5 to 1 Tons per month. For this you will need ~ 8 lakhs of investment.

Financing is easily available, as RCN processing units are considered under priority sector and SSI loans.

Contribution by Bank Contribution by Entrepreneur
Capital Investment 75% 25%
Working Capital Gap (Raw Materials+Debtors-Creditors) 75% 25%
Tenure of Loan 5-7 years
Moratorium 6 months to 1 year
Can be funded by SCB, Co-Operative Banks
One can also avail the Mudra Yojna Scheme & Standup Scheme launched by the Government of India

Comments

128 thoughts on “How to Start a Cashew Nut Processing Unit

  1. Sampath s

    Dear Sir,
    I want to more details regarding this business like market potential, raw material and which is the best machinery i use in this business. For finance how much our government will do help etc. Please give me above all details on my mail id and please send me infective marketing strategy to sell nut.

    Reply

    • UdyogCredit

      Hello Sampath,

      Thank you for writing to us.
      We can provide you all the details regarding setting up a cashew plant like machinery (Semi-fully automatic), raw materials, quality and capacity of the plant, process, storage, etc. We can also guide you on getting funding through nationalised banks under government schemes like Mudra and Standup India loan. Kindly write to us on info@udyogcredit.com for further details.

      Reply

  2. Nishant kumar

    Sir,I am from Bihar and much interested to setup this cashew processing unit in Bihar.Please provide me full detail related this.

    Reply

  3. park kwang han

    I am interested to start cashew processing unit. Please help me to get detail information of this including financial things.

    Reply

  4. Vinay Patel

    Dear Sir,
    I want to more details regarding this business like market potential, raw material and which is the best machinery i use in this business. For finance how much our government will do help etc. Please give me above all details on my mail id and please send me infective marketing strategy to sell nut.

    Reply

    • UdyogCredit

      Hello Vinay,
      We can provide you all the details regarding market potential, machinery, raw material, capacity utilisation and government schemes for funding requirements in a detailed report. Kindly mail us at info@udyogcredit.com. Thank you.

      Reply

  5. Abhay Khot

    Dear Sir,
    I would like to start a cashew processing unit and would like to acquire full details in doing could you please help me in doing so.

    Reply

  6. Pratyush

    Hi Sir,
    I’m interested to set up a Cashew Processing Unit in Odisha. Could you be able to provide any contact information on Cashew Business in Odisha to start with?

    Thanks

    Reply

    • UdyogCredit

      Hello Pratyush,
      We can provide you detailed information on Cashew Processing Unit and also get you in touch with a functioning cashew processing unit from Maharashtra. Kindly write to us at info@udyogcredit.com for more details.

      Reply

  7. satish patil

    HELLO TEAM,

    AM VERY MUCH INTERESTED TO DO BUSINESS, AM FROM KOLHAPUR MAHARASHTRA AND WANTED TO DO START OWN CASHEW PROCESSING UNIT, PLEASE SHARE THE TOTAL DETAILS e.g. TOTAL CAPITAL, MACHINERY AND ALL REQUIRED INFORMATION.

    Reply

  8. Rakesh Panda

    Dear sir,
    This is a nice article. Gives a lot of info.
    I’m interested in starting cashew processing. Can you please guide me?

    Reply

  9. sanni mb

    Please am intrested in cashew processing but I don’t have enough money to start with.
    There is availability of raw cashew in my country. I need your assistance to attain this
    Thank you

    Reply

  10. Subhash

    Thank you for your detailed insights. May I know if this is still a highly labour intensive l industry or there are fully automated machineries which available in the market?

    Reply

    • UdyogCredit

      Hello Subhash,
      It is a labour intensive business but there are automatic machines available in the market as well. Kindly write to us at info@udyogcredit.com for more details on types and availability of the machines. Thank you.

      Reply

  11. Subhash

    Thank you for your detailed insights. May I know if this is still a highly intensive labour industry or there are fully automated machineries which available in the market?

    Reply

  12. Subhash

    Thank you for your detailed insights. May I know if this is still a highly labour industry or there are fully automated machineries which available in the market?

    Reply

  13. Prashant Shetty

    Hello…I need more help and information on cahsew nut processing unit….as I am really interested in this venture….need your kind support.. thanks m

    Reply

  14. Prashant Shetty

    Hello..I need to have more information on cashew nuts processing unit….as me and my friend both are really interested in this project…. kindly suggest and help… Thanks

    Reply

  15. Vikas Mishra

    Dear Udyog credit
    I am very much interested to start this cashew processing unit in Allahabad. Is it feasible project for this location. Can you suggest and help me some other options also.
    Regards
    Vikas Mishra

    Reply

  16. mahendra janwalkar

    I am interested to start cashew processing unit. Please help me to get detail information of this including financial things.

    Reply

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