Agri Business

Cashew prices unchanged amidst muted trade

G. K. Nair Kochi | Updated on September 05, 2011

cashew

The cashew market remained quiet last week with price levels more or less unchanged.

W240 was quoted at $4.85 to $4.90, W320 at $4.55 to $4.60, W450 at $4.50 an lb (fob). At these rates very little business was done.

According to trade sources in Mumbai, some Vietnam processors offered few cents lower — W320 from $4.40 to $4.45, W450 at $4.35, Splits at $3.90, Pieces at around $3.75 a lb (fob). The stocks on offer were picked up quickly.

The domestic market was also quiet. Some processors who had not sold earlier or needed cash for Onam sold limited quantities at slightly lower levels. “But most processors are waiting to see how things develop during the first half of September before making additional sales for September-October deliveries,” Mr Pankaj Sampat, a Mumbai-based dealer told, Business Line.

On the supply side, the Southern crops are expected to be normal. “The next eight weeks will give us a better idea, especially about the Brazil crop,” he said.

Very high prices are being quoted for early shipments from Indonesia. Prices for Tanzania will be known in late October-early November. Mozambique prices will not be known till mid-end December.

Tanzania policy and Mozambique currency are two important factors needed that to be watched, the Mumbai-based dealer said.

Unless there is a dramatic fall in kernel demand-prices, there is little chance of lower RCN prices from Indonesia-East Africa as the quantity available is small.

Except for the recent activity in Vietnam at lower levels, the US and Europe markets have been very quiet for the last five-six weeks. There is a feeling that they need to cover some product for the last quarter based on some reports that the need may not be very large due to reduced off-take by retailers. “We should know more about that in the next six weeks. Activity in September will determine the price trend for the last quarter. If the Indian demand picks up as expected, market will remain steady to firm even if the buying by the US and Europe is slow,” Mr Sampat said.

For the medium term (FH 2012), a lot will depend on the Brazil crop prospects, Indonesia-Tanzania RCN prices and kernel market activity in September-October.

“If the trend of buying for short period continues, prices will remain steady and could even move up a few cents when there is bunching of buying from more than one market. If reasonable volume is traded in Sep-Oct for FH 2012 shipments, market will remain steady with the possibility of periodic dips when processors who do not have forward sales need to liquidate stocks,” he said.

Overall, there is nothing to indicate that demand-supply balance will be restored before mid-2012. “Till then we can expect the market to move in the current range. Logically, the next potential trend change point will be Mar-Apr 2012 depending on Northern crop prospects unless there is a dramatic fall in activity in kernel market in Sep-Oct coupled with very good crops in the South and lower RCN prices in November-December,” Mr Sampat added.

Published on September 05, 2011

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