Cashew market subdued as roasters turn cautious

KOCHI, NOV. 15:

The cashew market was quiet last week with a steady undertone. However, small volume of W320 was traded at $3.80-3.95 an lb (f.o.b) and that pushed the prices up marginally by few cents, according to trade sources.

Nominal levels for other grades were from $4.10- 4.30 a pound for W240; $3.70-3.85 for W450 and SW320; for SW360 from $3.50-3.65; for Splits and Butts from $3.10-3.25 and for pieces from $3.05-3.15 an lb (f.o.b).

The domestic market saw some activity in pieces at slightly higher levels but there was no change in prices of wholes, except for some increase in W320 in the inter-exporter market, Mr Pankaj N Sampat, a Mumbai-based dealer toldBusiness Line. He said that there was steady Chinese demand in Vietnam but they were buying from selected processors.

RCN TREND

Although some buyers continued to pick up quantities of raw cashew nuts (RCN) in Tanzanian tenders, there was hardly any business with shellers, he said. Offers, apart from some limited trades, took place in the price range from $1,500-1,600 for Indonesia, Tanzania, Guinea Bissau. Prices for other West African RCN are in the $1,100-1,300 range depending on quality.

Due to the very high level of uncertainty in economic situation, kernel buyers i.e., retailers, roasters and importers, are very cautious. Nobody seems to be in a mood to take any decision for long term purchases, he said. Everybody seems to be buying on “as and when needed” basis. This increases the potential for volatility, he said.

Long period of reduced buying could put pressure on some processors to reduce prices to move the product. Slight pick up in off-take could lead to need to buy more for nearby and required grades may not always be available leading to spike in prices. Prices can be stable in a reasonable trading range only when both sides – sellers and buyers – have adequate forward positions so that there is no pressure to buy or sell at short notice to meet immediate needs for product or cash.

Shellers in India and Vietnam have RCN inventory to take them through to end of the year.

Source: http://www.thehindubusinessline.com/industry-and-economy/agri-biz/article2630778.ece