Zooming price of imported raw nuts and dip in export prices have made export unviable for India. India imports over 60% of its raw nut requirement for processing. “Vietnam has been buying raw nuts from West Africa at a higher price to meet its export requirement. As a result the raw nut price has escalated to $2450 per tonne,” said P Sundaran, chairman of Cashew Export Promotion Council of India. India’s export had looked good in the first two months of the fiscal.
As its processing cost is lower, Vietnam has been selling below India’s rate. “The US and Europe have started buying from Vietnam as its cashew is cheaper though our cashew is superior in quality. We need support from the government through incentives for export,” Sundaran said.
Aggressive selling by Vietnam has pushed down the cashew prices in the export market. It has tumbled from over $ 5 per pound to $4.8. “Vietnam has targeted an export of 3.65 lakh tonnes for which it has been buying and stocking raw nuts till September-October,” said K Prakash Rao, managing partner of Kalbavi Cashews.
India is hoping to buy more raw cashew of better quality from Indonesia and East Africa, where the harvest season is expected to be a month earlier by August-September. “The Indian production is better than last year which may meet the needs of local manufacturers,” Rao said.
Indian cashew industry is gearing up for good domestic season with the onset of festival season from August. “ Post GST the stock of most traders is empty and hence they are likely to buy to raise inventory. At present the price in the local market is around Rs 810 per kg compared with Rs 725 per kg in the export market. The prices may rise further when the festival season begins,’’ Rao said.
India is currently the largest consumer of cashews with consumption touching 3 lakh tonnes, two times the export. The consumption is growing at a rate of 5% annually.