Cashew exports slow down, aggressive selling by Vietnam limits shipments

KOCHI: Cashew nut exports from India are likely to fall shy of nearly Rs 5,000 crore achieved in the previous year because of aggressive selling by Vietnam and increasing domestic consumption.
Although exports have shown an 8% jump in volumes and a 5% rise in value at 101,176 tonne worth Rs 4,098 crore for the period to December, exporters say high cost may hinder shipments in the last quarter of the fiscal 2015.
Depleting stocks may force Vietnam to slow down exports in the next couple of months. But India too doesn't have a comfortable level of inventory of raw nuts. "Cashew processing has increased in the country in the past 2-3 years because of a higher local consumption. As a result, the carryover stock is lower. Besides, current export prices don't justify the higher cost of raw cashew import taking place now," said Hari Krishnan R Nair, managing director, Western India Cashew Company .
India imports around 60% of the over 14 lakh tonne raw nuts required for processing, mostly from Africa. Exporters are now buying from Mozambique and Tanzania at a rate of $1,500 per tonne. Raw cashew purchased from Western African countries like Ghana and Ivory Coast earlier were cheaper.
"While India sells at around $3.50 per pound in global market, Vietnam is able to do it at $ 3.25 per pound thanks to its higher production and lower processing cost.Vietnam's stock has gone down and the country is waiting for its next crop starting from March. But India may not be able to capitalize on it because of high raw cashew price and delay in import shipment," said K Prakash Rao, managing partner, Kalbavi Cashews. In states like Kerala, high labour wages have contributed to the increased processing cost.
Processor-exporters seem to be more satisfied with the internal market now. "The business from domestic market has gone over the value of exports to `. 6,000 crore to . 7,000 crore. The prices realized are com` paratively better than exports," added.
According to Hari Krishnan R Nair, if the Commerce Ministry accedes to the exporters' demand for interest relief, exports may get a boost.
Prospects for the next fiscal appears to be better. "There is a little growth in production and there is a steady growth in usage due to relatively stable prices compared with other nuts. We expect the price range in 2015 to be higher around $3.75 per pound," said Pankaj N Sampat, director of Mumbai-based Samsons Traders in his cashew review for the next year

- India Times