Cashews: EVFTA shows its positive effects
May 18, 2022 at 2:34 PM ,
Der AUDITOR
High exports in 2021
The Vietnamese cashew market boasted impressive exports last year, according to the Vietnam Cashew Association (Vinacas). The association quotes Nguyen Thi Thu Thuy, deputy director of the Export Support Centre (Department of Trade Promotion), who revealed that the country shipped a total of 579,800 mt worth USD 3.64 billion overseas in 2021, representing a 12.6% increase in volume and a 13.3% increase in value year-on-year. Hopes for 2022 were originally for sales of USD 3.8 billion, but the feasibility of this remains to be seen amid geopolitical tensions.
EVFTA shows effect
After the US, the EU is the second most important export market for Vietnamese cashews, accounting for around 23% of total exports. According to Vinacas, 135,000 mt of cashews worth USD 816 million were shipped to EU markets in 2021, representing a 16.5% increase in volume and a 7.9% increase in value. The EU-Vietnam Free Trade Agreement (EVFTA) is likely to have contributed significantly to this increase, as Vietnamese cashew shipments to the EU are no longer subject to export tax since its introduction in August 2020. “This reduction is very important because before the EVFTA took effect, the tariff on cashew nuts imported into the EU from Vietnam ranged from 7 to 12%. The implementation of the EVFTA is expected to bring great opportunities to the cashew industry," Vinacas quotes Thuy.
Vietnam's market share to be increased
While Germany, the Netherlands, France and Belgium are among the most important buyers of Vietnamese goods in Western Europe, Russia and Ukraine are among the most important markets in Eastern Europe, along with Poland and Romania. Russia's invasion of Ukraine poses difficulties for Vietnamese exporters such as supply chain disruptions and high freight rates. In order to increase Vietnam's market share in European countries, Vinacas Secretary General Dang Hoang Giang is counting on an expansion of the trade agreements EVFTA and the Vietnam-Britain Free Trade Area UKVFTA. “Vietnam's cashew market share in European countries is currently between 40-60%, it is suggested to increase to 60-80% in the near future, especially in main markets such as the Netherlands, the UK, and Germany as well as France and Spain," Giang says.
On the European spot market, there was a slight price increase compared to last week. Vietnamese cashews, WW320 currently cost EUR 6.75/kg FCA Spain.
|
Cashew kernels |
||
|
Type, origin |
EUR/kg |
USD/kg |
|
WW320, Vietnam, FCA Spain |
6.75 |
7.10 |
|
WW240, Vietnam, FCA Spain |
7.35 |
7.73 |
|
WW210, Vietnam, FCA Spain |
8.40 |
8.84 |
|
W320, FOB India |
7.77 |
8.18 |
|
W240, FOB India |
8.39 |
8.83 |
|
Trade sources |
||
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