The Hindu Business Line : Cashew exports drop on competition from Vietnam

STIFF competition from other producing countries has pushed down export of cashew kernels from the country during April-December 2003, both in terms of value and quantity.

Exports during this period stood at 72,042 tonnes, valued at Rs 1,287.95 crore, as against 77,923 tonnes, worth Rs 1,463.84 crore, during April-December 2002. Imports of raw nuts increased to 3,57,740 tonnes, valued at Rs 1,087.39 crore, during April-December 2003 from 3,22,500 tonnes, worth Rs 1,003.24 crore, during the same period in 2002. Export of cashew nut shell liquid also declined to 5,726 tonnes (7,008 tonnes).

Attributing the drop to the tough competition from Vietnam, a new entrant to the world cashew market, Mr Sasi Varma, Secretary, Cashew Export Promotion Council of India (CEPC), told Business Line that competition from other tree nuts, mainly almond, was also responsible for the decline despite the fall in the unit value of cashew kernels. "The prevailing prices in the world market is still not remunerative," he said.

Exports by Vietnam had touched 80,000 tonnes in 2003 as compared to 63,000 tonnes the previous year.

He said despite the drop in the unit value to Rs 178.78 per kg from Rs 187.66 per kg during April-December 2002, consumption had not picked up in the major markets such as the US.

Much of the exports are still in the bulk form. Importers in the US, the main market for Indian cashew, are doing the value addition and marketing it under their brands. As a result, the low price of the kernel is not reflected in the price of the valued-added cashew nuts displayed on the shelves of the supermarkets there.

"Thus, the consumer is not getting the benefit of low kernel prices, and this factor has a negative impact on the exports," he said.

Besides, the almond lobby in the US is so strong that penetration into the market has become a difficult task.

Given the current trend, the CEPC expected to export one-lakh tonnes of cashew kernels valued at Rs 2,000 crore during the current fiscal, he said.

On the other hand, non-availability of raw cashew nuts indigenously is not only perpetuating the dependence on imported raw nuts but also it is on the increase of late. From the export earnings of Rs 1,287.95 crore, the forex outgo for importing the raw nuts was Rs 1,003.24 crore during April-December 2003, making the real forex earnings to Rs 200.56 crore.

Import of raw cashew nuts during January-December 2003 stood at 4,35,898 tonnes, against 3,94,099 tonnes in the corresponding period in 2002.

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