The domestic consumption of cashew kernels in India, of late, has shown an upsurge with an annual demand growth of over 10 per cent, absorbing around two-thirds of the total cashew kernel production in the country.

An estimated four lakh tonnes of cashew kernel is produced in the country, of which over 2.5 lakh tonnes are consumed by Indians themselves. “Thus, India has not only become a major supplier of cashew kernels in the world but also a top consumer,” Mr Shahal Hassan Musaliar, Chairman, Cashew Export Promotion Council of India (CEPC), told Business Line.

A change in food habits following an improvement in living standards and lifestyle has led to increased usage of cashew by the food industry, especially in bakery and confectionery products, he said.

Besides, use of value-added cashew products as snacks is also on the rise among the middle, upper-middle and high-income groups. As a result, the Indian domestic consumption of cashew kernels soared from an estimated 80,000 tonnes in 2003 to around 2.5 lakh tonnes currently. Yet, the per capita consumption of cashew kernel is estimated at 0.2 kg. The world cashew kernel consumption is put at about 5.2 lakh tonnes in 2010, according to a report. The other major consumers are the US, the EU and Japan. Indian exports of cashew kernels, of late, have ranged between 1–1.15 lakh tonnes.

For producing 4 lakh tonnes of cashew kernels, 16–18 lakh tonnes of raw nuts are required. According to the Directorate of Cashew and Cocoa Development (DCCD) under the Union Ministry of Agriculture here, an estimated 8.7 lakh hectares are under cashew with a total output of an estimated 6.5 lakh tonnes.

The organised and unorganised sectors are estimated to process around 17-18 lakh tonnes of raw cashew nuts. The rest of the raw nuts come from imports and from the unorganised sectors/ growers in rural India, trade sources said.

Maharashtra tops in raw nut production followed by Andhra Pradesh, Orissa and Kerala. According to the CEPC Chairman, there are 123 processing units operational in Orissa now and almost the entire quantity of processed kernels are supplied to the cashew industry in Kerala's Kollam district, the cashew capital of the country. The industry here does value addition and marketing, he said.

High prices

The demand in the domestic market is so great that value-added and superior grade kernels are sold at much above the international market prices. W 240 (i.e., 240 kernels make one lb) and W 320 fetch Rs 900 to 1,500 a kg in the domestic market while value-added products such as the salted, roasted and chocolate-coated varieties sold in sachets and tins fetch even higher prices. Prices quoted in dollar per lb for the top-grade varieties last Saturday were: W240 $4.30–$4.35; W320 $3.80–$3.85; W450 $3.65–$3.70, Mumbai-based dealer, Mr Pankaj S. Sampat, told Business Line.

“Its positive health aspects and taste have made it a popular snack in elite homes,” Dr K. A. Retheesh, Managing Director, Kerala State Cashew Development Corporation (KSCDC) told Business Line. The public sector corporation which has around 30 factories employing over 25,000 workers, markets almost the entire quantity of kernels produced by it. Nearly 90 per cent of the output is sold as raw material (kernel) to the industry while 10 per cent of it is processed into different varieties of value-added products. Considering the consumer preference, the corporation will launch cashew noodles soon in the metros, he said.

The response from the consumers in the metros, especially Delhi during the Diwali season, was tremendous and it was the motivating factor behind the decision to diversify into a variety of value-added products, he said. The KSCDC, he said, had launched the value-added products only recently and its share in the expected total turnover of Rs 170 crore during the current fiscal would come to 10 per cent, he said.

The main constraint that the industry has been facing since long has been the non-availability of indigenously produced raw nuts. As a result, the industry has to perpetually depend on imports. Unfavourable weather conditions and political instability in the supplying countries in West Africa often negatively affect availability, making the situation worse. The current short supply has raised raw nut prices to Rs 80 a kg, Kollam-based industry sources said.

They expressed the hope that the good prices may motivate the growers to take up cashew cultivation in many parts of the country and that, in turn, would push up the total national output of raw nuts.

“In fact, cashew can be grown in wastelands and lands that are not suitable for cultivation of any other crop. But, it demands political will, promotion and motivation,” Dr Abdul Salam, a Professor with the Kerala Agricultural University and an expert on cashew, told Business Line.

(This article was published on February 17, 2011)
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