Cashew from the heart to the world
Farmers’ profits from cashew in 2016 are predicted to be much higher than in previous years, even though the harvest season has only just begun.
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According to the Vietnam Cashew Association and the General Department of Customs, 2015 is the 10th consecutive year that Vietnam holds a leading position in exporting cashew. With an export turnover of more than US$2.4 billion, signifying an increase of 8.7% in volume and 20% in value over the previous year, last year marked the nut’s highest achievement to date.
Cashew is one of Vietnam’s major agricultural exports and holds more than 50% of the global cashew market share. International traders find it impossible not to mention Vietnam when it comes to cashew.
Visiting Phu Rieng of the southern province of Binh Phuoc, the land of basalt known as the cradle of the cashew industry in Vietnam, Nguyen Van Huu, a farmer who has been inseparable from cashew trees for over 10 years, cheerfully said that his net profit from cashew was over VND300 million (US$14,500) in 2015.
As observed, by mid-March 2016, fresh cashew nuts were traded at prices VND7,000 - 8,000 per kilogramme higher compared to the same period in 2015.
Farmers play a big role in the development of cashew in Vietnam, but it is also important to note the exporting and processing enterprises who have managed to bring Vietnamese cashew to households all over the world.
Long An Export Processing Joint Stock Company (Lafooco) provides a notable example.
30 years ago, the first cashew trees in Vietnam marked the establishment of Lafooco and its important mission to bring cashew nuts from Vietnam to the world. For the past three decades the company has been pioneering the exporting of cashew to markets, such as the US, Europe, China, Australia, and the Middle East.
Lafooco is in the top ten cashew exporters in Vietnam with an export turnover of US$40 million, accounting for 2.5% of the domestic market. The company is also amongst the top five largest cashew processing companies in the country, with a capacity of 20,000 tonnes a year. The company currently owns two purchasing and processing stations with a total area of 13.8 hectares.
Consumers’ changing habits and the demand for ever-higher quality all over the world have forced enterprises to "innovate", and Lafooco is no exception.
In previous years, Lafooco mainly focused on exporting raw cashew nuts to international roasting companies. Trusted for its product quality and stability over many years, punctual international delivery service, prioritising its brand’s prestige and customers’ benefit, the company has now made its first steps into value-added production.
Departing from simply producing raw cashew nuts, Lafooco has now its own line of processed items, packed with unique brand images, and has expanded its product portfolio with nuts and snack items made from high value seeds, such as almonds and macadamia.
As one of the leading companies in exporting to markets with high quality requirements, Lafooco has noticed the inevitable need for sustainability, maximising product value, and getting further involved in the extensive global supply chain. It is Lafooco’s goal to become a leading international brand building on credibility with its customers and partners.
As a strategic step to strengthen its capabilities and standardise professional management procedures, in 2015, Lafooco officially became a subsidiary of PAN Food, yielding 80.5% of its stakes in exchange for support from major financial institutions, such as IFC, the investment fund of the government of Singapore, Mutual Elite Fund, and NDH Invest.
Along with development strategies, Lafooco has started to show positive changes in terms of management and easier access to capital resources to cater for its long-term goals.
Regarding its branding strategy, Lafooco has recently re-positioned itself to lay heavier emphasis on the company’s motto: "cashew processing with a whole-hearted approach."
In 2016, Lafocoo’s new brand identity centers around the theme of basaltic soil where cashew trees blossom and produce quality products.
The letter “A” in Lafooco was positioned higher to demonstrate grade-A quality of all products, top quality services, food safety, and professional manner. The letter “O” with a heart icon is an allusion to the company’s motto, ensuring customers that Lafooco does not only care about profit but also cares for the farmers and workers working in the cashew industry.
Lafooco is one of the few companies in the Vietnamese cashew industry that stands committed to social responsibility from business philosophy to daily activities, and as a result, was granted the Fair Trade certification along with many other valuable certificates, such as BRC Food Certificate Type A - Certificate of Global Food Safety by the British Retail Consortium.
These certificates provide Lafooco and the domestic cashew industry with more advantages and options in the process of dealing with global customers, as well as accessing a larger market.
