Cashew exports to gather strength in next quarter

Cashew exports are likely to gather volumes with big retail giants tendering supply for their next quarter requirements, traders said.

Exports during the past four months were quiet subdued and lesser than the performance of the corresponding period of the last fiscal. Global short supply of cashew crop is likely to balance the demand and firm up the market from September, Pratap Nair of Vijayalakshmi Cashews told FE.

According to industry experts, buyers in Europe, Japan and Australia do major portion of their buying for the next season during September-October. US buyers also stock in advance for the coming Christmas and other festivals. "With Vietnam on the short side, India should do well in the coming days. Prices have already firmed up a bit on the global short supply," Pratap Nair said.

Regarding the fall in exports during April-July of 2009, traders feel that market would recoup in the coming months. Traders are expecting the market to rebound in the coming months on the backdrop of a supply crunch.

Higher inventory by the processors and exporters also point to a revival, sources said.

Cashew prices are firming up globally on lesser availability of cashew kernels in the market due to restrictions on export by Kenya, Mozambique and the problems faced by the Vietnamese cashew exporters.

Indian exports are down by 15% in volume and value for April-June 2009, when compared to the corresponding period of the last fiscal.

However, imports are on the rise, due to shortage in Indian production and good domestic demand. During the four months of 2009-10, imports of raw cashew increased by 37 % to touch 363,990 tonne valued at Rs 1,331.55 crore. The unit cost of importing has come down to Rs 36.58 per kg as against Rs 38.76 during the previous period.

"Domestic demand is seen increasing and very attractive for traders. This is reflected in the increasing import of raw cashew in spite of a fall in exports," Pratap Nair said. Festival demand from the up-country market is likely to firm up the domestic market, he added.