Cashew prices may rise in H2

KOCHI, APRIL 2: 

The cashew market witnessed buoyancy in March with reasonable activity in kernels and good activity in raw cashew nut trade, after a sluggish trade in February.

At the end of the month, however, the market was steady with selling interest being lower in the first quarter. The domestic market has also been ruling steady within a narrow range with periodic bursts of activity. It was evident from the shipments in February, when exports dropped to 7,009 tonnes (valued at ₹315.43 crore at a unit value of ₹450.04 a kg) against 7,972 tonnes (valued at ₹298.69 at the unit value of ₹374.67 a kg) in the same period a year ago.

Even though there was a decline in volume, the value realisation increased because of the rise in unit value and the exchange rate, Sasi Varma, Executive Director and Secretary, Cashew Export Promotion Council of India, told Business Line.

Import of cashew kernels has plunged due to the higher import duties.

Last week, the range of offers for the second quarter was W240 $3.60-3.75, W320 $3.15-3.30, W450 and SW320 $2.95-3.05, SW360 $2.75-2.90, SSW $2.45-2.55, splits $2.40-2.55, pieces $1.65-1.75/lb (f.o.b). Offers for second half were a few cents higher.

After a decline in February, raw cashew prices have moved up a tad in the last two weeks. Current prices are at around $850-875 c&f for Nigeria, $950-975 c&f for IVC, $1,075-1,100 c&f for Ghana and around $1,150 c&f for Benin.

These prices are 10-15 per cent higher compared with the same period last year (kernel prices are 3-5 per cent lower, however). Such disparity cannot be sustained – something has to change, Pankaj N Sampat, a Mumbai-based dealer said.

“Shipments of West African raw cashew have started. During April, we will see whether flow from Ivory Coast will be smooth despite restrictions on movements. Initial reports indicate that efforts to enforce quality standards are bearing fruit,” he said.

Traders said that the downside from current levels will be limited. At the same time, there is no reason to expect a big jump in prices, it said.

But, a reasonable and gradual price increase in second half of the year is possible unless the raw cashew prices drop significantly during April-May. Decline in raw cashew prices after May will not have any major impact because that will be accompanied by decline in kernel yields.

The Hindu