Buoyancy seen in domestic cashew market

KOCHI, SEP 11: 

Domestic cashew market, which was very quiet for several weeks, has been active during the last couple of weeks. Prices for splits and pieces have moved up by 10-12 per cent in a fortnight.

Processors expect demand and prices for wholes to pick up during the coming 2-3 weeks, market sources said.

The depreciation of the rupee since May and the volatility in the last 2-3 weeks has created an uncertainty in prices of all nuts in the domestic market but this is expected to stabilise in the current range.

However, overseas cashew markets were very quiet in August after a fair amount of activity during June-July. There has not been much change in prices. All offers at the lower end of the range, mainly nearbys, are being picked up. Prices were: W240: $3.85; W320: $3.35; W450: $3.05; SW320 $3.10; Splits: $2.30 and Pieces: $1.60 for a lb (f.o.b.).

LIMITED AVAILABILITY

The raw cashew nut (RCN) market is quiet. Availability for India and Vietnam in the next six months is limited to small quantities from Indonesia and East Africa.

Looking at the next six months, “we feel that it will be demand side which will influence the market trend and price range. Supply factors cannot have much impact since there is very little RCN, say less than 25 per cent of world production, to be traded in the next six months,” trade sources claimed.

During Sept/Oct, the trade claimed, they expect a fair amount of buying interest from roasters for first half of 2014 and traders for shipments from Oct/Nov onwards.

Unless buyers are prepared few cents higher, selling interest will be limited to nearbys, as every processor will be reluctant to sell forwards at lower levels because replacement availability is limited. If Indian demand picks up in the next few weeks as expected, it would keep many Indian processors away from the international market, they said.

According to the trade, “downside from current levels is limited.” There is a reasonable possibility of a small, gradual rise by end of the year, with a slight possibility of the market crossing the $3.50 a lb barrier. Any large increase is ruled out unless there is a big spurt in demand, they added.

Source: The Hindu