Cashews: blow to exports
November 29, 2022 at 10:27 AM ,
Der AUDITOR
Spending shifts in Europe
The Centre for the Promotion of Imports from developing countries (CBI) not only states that the European cashew market will continue to grow by 3-5% per year in the next five years, but also highlights that imports very much depend on supply and prices. This renders the market particularly vulnerable to the multiple crises witnessed this year. Not only has the war in Ukraine disrupted supply chains but annual inflation also reached 10.6% in October according to Eurostat, which is up on the 9.9% recorded in September 2022. Energy has the highest rate of 41.5% (40.7% in September), followed by food, alcohol and tobacco with 13.1% (11.8% in September). Consumers are consequently tightening their belts and businesses are considering their purchases very carefully, which has an impact on Vietnam as Europe's leading supplier for cashew nuts.
Exports dip
Europe is, however, not the only worry for Vietnam’s cashew suppliers. Fact is that that the country’s exports have declined sharply to most leading destinations. At 44,310 mt worth USD 265.67 million October exports ranged 16.5% lower in terms of volume and 24.3% lower in terms of value than in October 2021. Total exports have also declined by 11.7% in volume and by 15.5% in value between January and October as compared with the same period last year, despite average export prices ranging 4.4% lower at USD 5,911/mt as the Vietnam Cashew Association (VINACAS) reports.
Exports have taken double digit dips to Vietnam’s top markets. Shipments to the United States have notably declined by 20.4%. Although Vinacas highlights that total US cashew imports declined by nearly 15% in terms of volume and value between January and September to show that Vietnam is actually performing quite well here, it should be noted that Ivory Coast is gaining market shares in the US. China also reduced imports from Vietnam by 29.1%. Shipments to the Netherlands and Germany, the two most important export destinations within the EU, have also declined sharply, which clearly reflects the current economic situation. Shipments to the United Arab Emirates, Israel and Saudi Arabia have, by contrast, risen sharply.
|
Cashew nut exports, Vietnam, 2022 |
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|
Destination |
mt |
USD |
Diff. mt |
Diff. USD |
|
USA |
119,391 |
700,289 |
-19.8% |
-20.4% |
|
China |
59,871 |
356,180 |
-12.3% |
-29.1% |
|
Netherlands |
45,228 |
246,212 |
-22.4 |
-22.9% |
|
Germany |
14,813 |
91,269 |
-14.2% |
-16.2% |
|
Australia |
13,461 |
80,303 |
-0.6% |
-4.0% |
|
UK |
13,097 |
74,040 |
-3.1% |
-5.6% |
|
Canada |
10,630 |
64,959 |
-22.7% |
-29.3% |
|
UAE |
7,817 |
47,911 |
27.9% |
24.5% |
|
Israel |
7,256 |
52,742 |
19.7% |
17.1% |
|
Saudi Arabia |
6,930 |
44,372 |
54.2% |
46.8% |
|
Others |
126,335 |
786,749 |
-3.3% |
-5.7% |
|
Total |
424,829 |
2,545,025 |
-11.7% |
-15.5% |
|
General Department of Customs, Vietnam, Jan-Oct 2022 |
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Prices shape demand
Although cashews have gained popularity throughout Europe in recent years, several dynamics are at play. CBI not only highlights that European cashew nut imports rose by 6.7% every year in terms of volume between 2017 and 2021 but also that they declined by 3.4% in terms of value. Demand is not only driven by consumers changing their habits but also by prices and other economic factors. Many companies have also started investing in production sites in West Africa to reduce their dependency on Vietnam and India and to instal more sustainable supply routes. The prices for cashews kernels form India and Vietnam have declined a bit in recent weeks.
|
Cashew kernels |
||
|
Type |
USD/mt |
EUR/mt |
|
LWP, FOB India |
6,830 |
6,583 |
|
SWP, FOB India |
6,165 |
5,942 |
|
W320, FOB India |
8,175 |
7,880 |
|
W450, FOB India |
7,460 |
7,190 |
|
WW240, Vietnam, FCA Spain |
6,460 |
6,300 |
|
Trade sources |
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