Activity picks up in cashew market

After a protracted dullness there was limited activity in the Cashew market during last week. Some trades were reported for W240 and W320 but other grades were more or less neglected, market sources said.

Offers continued to be in a wide range – W240 from $3.60-$3.75; W320 from $3.25-3.40; W450 and SW320 from $3-3.15; SW360 from $2.70-2.90; splits from $2-2.20; pieces from $1.60-1.80 an lb (fob).

The domestic market saw some pick-up in activity but prices for broken grades were capped by cheap supplies from Vietnam.

China continued to be a selective buyer in Vietnam.

Despite more than six weeks of stray sales and limited activity in the kernel market, there has not been much change in prices of the main grades. “We are seeing almost the same range of prices since middle of July. Shellers are reluctant to sell at lower levels because there is no significant availability of good quality RCN for replacement at workable levels”, Pankaj N. Sampath, a Mumbai-based dealer, told Business Line. Similarly, buyers are reluctant to buy at higher levels because there continues to be an uncertainty about offtake in the last quarter which will give an indication of what they will need for processing in the first half of 2013 i.e., until the 2013 Northern crops become available.

However, there is a reasonable expectation that some business will be done in the next few weeks – mainly for 2013 deliveries as some buyers may need to top up last quarter requirements but that may be for very limited volumes. “If this expected buying is for small volumes, prices will remain around current levels but if the buying is for larger volumes or longer spreads, we could see some increase in prices in the next 6-8 weeks”, he said. Unsold West African Raw Cashew Nut (RCN) stocks are probably larger than normal for this time of the year but since the kernel market is slow, there is not much interest although prices did come down reflecting lower quality.

RCN Supply

RCN so far has been bought at high prices and what is available now is poor quality , he pointed out. Good quality new crop RCN from Indonesia is steady at around $1,350 a tonne.

However, the situation in East Africa is yet to be known.

“Unless Tanzania changes its policy, prices are unlikely to be low”, he said.

Situation in Brazil continues to be hazy. Overall, “ we do not expect any major change in the price range till the end of the year but we feel that the chances of a steady to slightly firm market are more than that of a softer market unless the quietness in the kernel market continues for another 6-8 weeks”, Sampath added.

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