Nuts

Cashews: reduced output alerts buyers

April 22, 2024 at 11:06 AM , Der AUDITOR
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REUS/NEW DELHI. The International Nut and Dried Fruit Council has revised the 2022/2023 production estimates for cashews upwards. Yet, prospects for 2024/2025 are far from encouraging. In India the market has started to turn.

Tricky situation

Trouble is that El Niño-related heat and drought have impacted output in Vietnam and many African states this year. Delayed shipments prompted by the Red Sea crisis have also hit the US and EU. While the INC’s final crop estimate for Côte D’Ivoire stands at 1.33 million mt for 2023/2024, the market is currently alerted over the lower output in the country, which may drive up the in-shell market. In general, the crops are late, and arrivals are down in the Northern Hemisphere this year. Production may, however, catch up during the crop cycles in Africa and Vietnam.

Cambodia’s production may have flatlined in 2023/2024 but fell by an estimated 10-30% in 2024/2025 as the Cashew Nut Association of Cambodia (CNC) states. Issue is the impact of the EL Niño weather event with excessively high temperatures of more than 40C (104F) and drought being reported in March. Harvesting takes place in mid-February and although output was certainly lower, prices have dropped. Shocked by the sharp price declines witnessed last month the Association urged farmers to hold back supplies and wait for higher prices in July to September. The country can only process around 7,000-15,000 mt of RCN in a medium-sized factory, of which the country currently only has seven. RCN exports to Vietnam surged by 50% in January 2024 as compared with January 2023.

In Vietnam this year’s crop may not be shaping up that well, but exports are good. Statistics provided by the General Department of Customs show that Vietnam, in fact, exported 147,000 mt of cashew nuts worth USD 782 million in the first quarter of 2024. This presents a 32% rise in terms of volume and a 20% rise on terms of value. Local processors are, therefore, keen to secure RCN supplies from Africa.

A similar situation to Cambodia prevails in Nigeria. Production may have surged by more than 30% in 2023/2024 as INC figures show but is expected to decline this year. Issue are the harsh harmattan winds as local media reports indicate. Prices have also fallen here as the naira has gained strength. The country earned NGN 194.2 billion (USD 180 million) from exporting cashews in 2023, which presents a large portion of the country’s agricultural exports.

Production rose by 9% in the Northern and Southern Hemispheres in 2022/2023. Total production also climbed by 11% as INC estimates shows. Demand may prove tricky this year as consumption is reportedly good but stagnant on last year’s levels in the US, China and Europe. As the Red Sea crisis has delayed arrivals in the US and Europe spot market demand was also lower in March.

Global raw cashew nut (RCN) production (mt)

Country

2022/23

2023/24

Diff.

Côte D’Ivoire

1,270,000

1,335,000

5.1%

India

590,000

740,000

25.4%

Cambodia

670,000

680,000

1.5%

Vietnam

450,000

400,000

-11.2%

Nigeria

270,000

360,000

33.3%

Guinea-Bissau

250,000

270,000

8.0%

Benin

250,000

250,000

0.0%

Ghana

215,000

250,000

16.3%

Burkina Faso

140,000

160,000

14.3%

Guinea Conakry

140,000

160,000

14.3%

Togo

73,000

120,000

64.4%

Senegal

95,000

100,000

5.3%

Gambia

28,000

28,000

0.0%

Mali

7,000

10,000

42.8%

Subtotal
Northern Hemisphere

4,448,000

4,863,000

9.3%

Tanzania

185,000

260,000

40.5%

Brazil

147,200

117,800

-20.0%

Mozambique

90,000

90,000

0.0%

Indonesia

80,000

80,000

0.0%

Kenya

5,000

5,000

0.0%

Subtotal
Southern Hemisphere

507,200

552,800

9.0%

Total

5,010,200

5,572,500

11.2%

INC March 2024

Market starts to shift in India

Although India’s production bounced back to 740,000 mt in 2023/2024, crops are reportedly smaller this year. This has finally started to drive up the market in India in recent weeks, after prices declined a bit throughout February and March. Quotations for W320 kernels have, in fact, nearly reached last year’s level.

Cashews, India

Type

USD/mt

LP-1 9/15

9,885

LWP

6,570

SWP

5,905

W320

7,915

W450

7,200

FOB India

 

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