Cashews Impact
    Category: Philanthropy By : Anton Muhajir Read : 2048 Date : Tuesday, August 19, 2014 - 07:57:08

    Anton Muhajir for Forbes Indonesia

    Located in a remote area of northeastern Bali, Ban village was long known as one of the poorest villages in Bali, located about 2.5 hours away from Denpasar on the slopes of Mt. Agung. For decades, this village produced beggars and street children who scrapped out a living in Denpasar and Kuta, the tourism centers of Paradise Island. With its dry climate and unforgiving soil, most villagers live on limited resources and incomes. The 3,000 villagers of Ban have an average income of $2 per day.

    Two years ago, American Aaron Fishman came to this village with his wife Lindsay White as volunteers with a local NGO. They worked on public health issues, such as hygiene and nutrition. They lived in a simple shack like everyone else in the village. While living there, Aaron discovered that most of the villagers earned some income from harvesting cashews. The delicious nut is one of the few crops that can grow in Ban’s subdistrict of Kubu. Villagers from surrounding villages also earned a meager living off harvesting cashews.

    Bali has long produced cashews, last year producing 3,735 tonnes, grown on 12,591 hectares, according to government statistics. Cashews are grown in several places in Bali, but mainly in the Karangasem district, which has nine regencies including Kubu. Moreover, the cashews from Kubu are known for their crunchy, savory flavor, with undertones of milk.

    After harvesting the cashews, the villagers traditionally sold the nuts to traders who shipped them to India and Vietnam for processing. Ironically, these same cashews had to be reimported into Indonesia for consumption. Aaron realized that this system meant that most of the profit made from the cashews went to the middlemen, the processors and traders and very little stayed with Ban and other villages. Aaron’s insight was rather than send the cashews abroad for processing, why not process them in Kubu. “Economic problems could be solved if there was cashew processing in the village,” Aaron says. For him, this idea was not merely about business, he saw it as a social enterprise, a business specifically aimed to create a positive return for the local community.

    But it was not easy to get the idea off the ground. Aaron needed funding of roughly $400,000 to start the business. He had to find the land, build the factory and buy all the equipment for $200,000. Most importantly, he had to purchase all the cashew in the three-month long harvesting season to last for the whole year for $200,000 and keep all of it fresh in a warehouse after the harvest.

    After collecting funds from friends, family and his own credit card, Aaron raised $180,000 to build the one factory building. He also borrowed an additional $200,000 from another 10 people to start the business. Then, Aaron started the East Bali Cashews (EBC) factory in April 2012 as the first large-scale cashew processing facility in Bali and one that also uses sustainable, ecofriendly business practices to process the cashews, package and sell them.