Nuts

Cashews: market fraught with challenges

March 11, 2024 at 11:55 AM , Der AUDITOR
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BRUSSELS/NEW DELHI. EU imports have dipped to a five-year low for cashew nuts. Ivory Coast has ramped up exports but is struggling to maintain local processing. Disruptions continue in India.

Ivory Coast continues success in EU

After a slow start to the year EU cashew nut imports gained momentum in February. Yet, they still ranged 14% lower than in 2023 at a five-year low of 21,432 mt in the first two months of 2024. In terms of value imports even declined by 27% to a nine-year low of EUR 110 million (USD 120 million) as opposed to the EUR 152 million (USD 166 million) registered in January to February 2023.

Although Vietnam has remained the leading supplier for the EU by far, shipments have dipped by 16%. Ivory Coast has retained its position as second most important supplier and shipments are nominally up. Contrary to this, shipments from India, which ranks third, have slumped by 43%. The Netherlands account for 44% (9,520 mt) of the EU’s total imports this year so far, followed by Germany with 23% (4,930 mt) and Italy with 7% (1,500 mt).

EU cashew nut imports (mt)

Country

2023

2024

Diff.

Vietnam

18,261

15,342

-16.0%

Ivory Coast

3,092

3,177

0.8%

India

1,336

766

-42.7%

Benin

119

379

218.5%

Burkina Faso

641

425

-33.7%

Brazil

479

214

-55.3%

Nigeria

193

227

17.6%

Ghana

308

143

-53.6%

Mozambique

193

205

6.1%

Tanzania

73

218

198.6%

Others

694

336

-51.6%

Total

25,389

21,432

-15.4%

DG TAXUD Customs Surveillance, provisional data, 01/01-29/02
HS Code 08013200 Fresh or dried cashew nuts, shelled

Challenging market situation

Economic uncertainty and high inflation are responsible for the downturn in EU imports. The EU Commission currently estimates annual inflation at 2.6% for February 2024, which is down on the 2.8% registered in January.  Food, alcohol and tobacco should have the highest annual inflation rate of 4%, which is down on the 5.6% witnessed in January, as this sector has the highest fluctuations in price.

Ivory Coast’s success is mainly driven by the industry’s adherence to EU quality and supply chain standards. According to the Ministry of Agriculture the country’s raw cashew nut output is expected to rise by 5% to 1.25 million mt in 2024 as opposed to last year as Reuters reports. Ivory Coast exported 849,250 mt of cashews in 2023 as compared with 719,000 mt in 2022. Vietnam and India featured as the main export destinations, whereas only 22% (265,863 mt) were processed locally. The country’s objective is to process 50% of production locally by 2026 with the help of tax breaks and government subsidises. Competition with Asia is, however, fierce with the Ivory Coast Cashew Industry Group (GTCI) reporting that around eight processors have gone bankrupt since 2020. The government set this year’s farmgate price at CFA 275/kg in February, which is down on last year’s CFA 315/kg.

Prices have taken another dip in India on the back of a comfortable supply situation. Demand is also rather sluggish, especially in the Middle East and in the domestic market, and the farmers’ protests in New Delhi are reportedly still causing disruptions. W320 cashew nuts are trading at USD 7,905/mt FOB India.

Cashews, India

Type

USD/mt

LP-1 9/15

9,890

LWP

6,560

SWP

5,895

W320

7,905

W450

7,190

FOB India

 

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