cashew price

April 19 - 24, 2010

Volume 11 Issue 17

CASHEW WEEK

A Product of

CashewInfo.com

CONTENTSMarket Commentary FOB Price Movement Forex Rates Rupee outlook Exporters' Guide News Highlights Domestic prices of nut Trade Events

SPECIAL COVERAGE:Cashew once meant for export loosing its way

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A Product of www.CashewInfo.com

Market Commentary

Market Commentary from experts :Sri. Pankaj Sampat, SAMSONS TRADING CO, Mumbai After a quiet beginning, there was some activity in the market in the second half of week 16. Some quantities were traded to USA (and a little to Europe and other markets as well). Prices moved up a few cents with sales for W240 at 3.05-3.10, W320 at 2.80-2.85, W450 at 2.70-2.75 FOB. Splits / Butts moved up to about 2.35 FOB but offers were scarce. Indian domestic market continued to be quiet. RCN market is steady. First shipments of WA RCN have started arriving in India. Most of the Benin crop has been sold. IVC is trading around US$ 800. In March, most of the sales were to Vietnam but now both India & Vietnam are buying. There have been some speculative sales by RCN traders for GB but real situation will not be known till mid May. There is a reasonable quantity of RCN still to be traded from IVC + GB (and its smaller neighbours) but it is difcult to judge the price trend. On the demand side, rst quarter offtake seems to have been good (although there are reports of declines in some markets). Outlook for coming months is not clear but there are no reasons to expect any decline. If prices for other nuts do not come down, retailers in USA & Europe might be inclined to put more cashews & mixed nuts/dried fruits on the shelves to meet the nut category demand. Inventories are low (and might be tighter in Jun/Jul due to lower shipments from origin in Apr/May). Some buyers have been buying portion of their forward requirements in the last few weeks, but many buyers continue to buy for nearbys only as they do not see anything on horizon for prices to increase too much. On the supply side, despite crop concerns in some areas & delays in some others, overall availability for 2010 seems to be comfortable. But due to the uncertainty of RCN prices, processors are reluctant to make any large forward sales. Unless the RCN prices come down in May/Jun, they will not be inclined to take on any big commitments they will continue to

Indian Cashew Market Commentarysell small volumes when they have to because the regular demand will keep things moving. Periodic dips have been opportunities for buyers to cover some volume and periodic spikes have been inducing processors to make some sales. This trend is likely to continue and keep the market within current range until we reach a tipping point either a big change in RCN prices or a big bunch of buying or selling interest in a short period. Sri. Giridhar Prabhu, Achal Cashews Private Limited, Mangalore There is news of rmness in cashew kernel market. It was range bound at 2.75 to 2.80 and now there is news that business has been done at 2 .90. This rmness at this time is an indicator of progressive buying matched with a limited inclination to sell. This is normally the time when most buyers prefer to buy for next few months, as they need to ll in the orders of the last quarter of the year. RCN markets have declined in nominal terms but in real terms prices are steadier. Arrivals in some markets like Orissa have just begun while Mangalore area is having its peak period. Prices have declined mostly on quality concerns but still above par in some places. Data from East Coast is not available. The DCD has put out a report that the Indian crop is short by ten per cent. It will be another 3 weeks to go before one gets into a focus in a certain area. Indian market is extraordinarily quiet with buyers refraining from entering the market in principal areas, Mumbai and Delhi. This is in view of the Vat issue. It is hoped that there is an early resolution. India has a scorching heat above normal and this deters consumption a bit. The wedding season is now three weeks away and some buying in two to three weeks is expected on this account, especially in broken grades.

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A Product of www.CashewInfo.com Demand could pick up from Japan and Western Markets from this week onwards for near and forward positions and from spot markets from July onwards till October. Exchange rates could play a signicant role in pricing. The strength of the Indian rupee could result in positive movement in prices. West African supplies could be crucial for exports. Any decline in Indian raw cashew production would affect the pricing in Indian markets while any decline in Vietnamese production could impact international prices. Availability of African would be possible for supplies and this again depends on processing capacities and throughput in India and Vietnam. Sri. Rajendra Sabat, Sabat Associate (cashew expert/ Consultant), Orissa. In this entire region raw cashew arrival to market is satisfactory and in full swing. Now all most at all the market the RCN price is stabilized at Rs.50 per kg. The quality of the present crop that is arriving at different markets is reported better and seems to be good with dry shortage of 4 to 5 kg maximum. At some places the price is either one rupee less or high based on quality. All most all the old stock of kernels of last year crop is completed. The new crop price will come in the 1st week of May because most of the factories were started their new crop production from last week onwards and some are yet to start with new crop. After two to three weeks one can say the real position of the market. If the RCN arrival will continue smoothly with full swing then only the crop size & future of the market can be assessed. The current kernel prices in Rs/kg Grades JEYPORE Coastal Orissa / Palasa

Market CommentaryW-320 W-450 JH K 320-325 300-305 275-277 250-255 320-325 300-305 275-280 250-255 285-290 270-275 255-260 215-220 290-295 275-280 260-265 215-220

Sri. Biju, M/s. AGRO TRADE INTERNATIONAL, Kollam The cashew nut kernels export market continued to remain quiet. Prices were down by a few cents biz reported W240 was at around $ 3.05 per lb FOB ($ 6724 / Mt Fob), W320 around $ 2.85 per lb FOB (US $ 6283 / Mt Fob), W450 around $ 2.65 per lb FOB (US $ 5842 / Mt Fob) level, as buying interest from US and Europe were very less. Both the buyers and sellers are now waiting for some competitive price. Very few processors are prepared to offer new crop at current market because of the downtrend. We expect the market to remain rm until June 2010 and then prices could start to ease again. We recommend covering your immediate requirements and watch the market developments. Raw cashew arrivals are better in some counties, Ivory Coast raw cashew traded at US $ 750 Per Mt C&F Cochin for 48 Lbs, Guinea Bissau at US $ 900 per Mt C&F Cochin, Konakry at US $ 745 per Mt CNF Cochin for 48 outturn. The FOB prices of cashew kernels from Kollam market (in USD/lb FOB) Grades 04/17/10 W-180 3.45 W-210 3.30 W-240 3.10 W-320 2.80 W-450 2.45 SW-240 2.80 SW-320 2.40 LWP 2.05 LSP 1.85 Note: Packing in 1x50 Lbs Flexi 04/24/10 3.50 3.20 3.05 2.80 2.55 2.80 2.50 2.10 1.90

W-240

04/17/10 04/24/10 04/17/10 04/24/10 340-345 340-345 315-320 320-325

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Market Commentary

Indian CNSL market commentarySri. Venkatesh, KANCO SOUTHWEST ENTERPRISES, Mangalore The price of CNSL loose remained steady at previous levels of Rs.21.50 per kg at Ex- Mangalore. The prices of Cardanol also remained steady at Rs.41 per kg at Ex- Mangalore. The new crops have brought Panruti raw nut market down by almost 8%. The raw nuts that were costing about Rs. 4500 per bag are now around Rs. 4050 to Rs.4100. The kernel prices are lowered accordingly. The parity in prices is likely to be reached in this week and we expect good shelling there after. The shell prices have nosedived and are at Rs.5.65 per kg. CNSL has come down to Rs.20 per kg with cake prices remaining steady at Rs. 3.30 per kg. The north Indian buyers are likely to enter market of CNSL very soon.

Sri. Omprakash N. Phadnis, M/S. N.S. PHADNIS, Panruti, Tamil Nadu The new crop has started in Panruti market. My best guess is crop would be near normal.

International Cashew Market CommentaryMr. Kim, Vietnam Soft demand has come out during the past week. Small and medium sellers sold W240 at USD 2.95, W320 at USD 2.75, Lbw320 at USD 2.55, W450 at USD 2.55, WS at USD 2.18 per lb FOB for May shipments. Top and reliable sellers indicated W240 at USD 3.05, W320 at USD 2.80/2.85, WS at USD 2.25, DW at USD 2.25/2.30, LP at USD 1.62/1.65 per lb FOB for June August shipments with big quantity but no business reportedly done at these mentioned levels as buyers could not pay at these high prices indicated by sellers. Buyers ideal prices were somehow lower than sellers ideals and if they could not buy at estimated levels they would prefer to wait and see rather than chase the current markets levels as the fact that not strong demand from roasters/ manufacturers. Extracted from US source: What will it reect? On a seasonally adjusted basis, the Consumer Price Index for All Urban Consumers (CPI-U) increased 0.1 percent in March, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the index increased 2.3 percent before seasonal adjustment. The seasonally adjusted increase in the all items index was mostly due to an increase in the fresh fruits and vegetables index, which rose 4.6 percent in March and accounted for over 60 percent of the all items increase. Other food at home indexes were mixed and the index for food away from home was unchanged. The index for energy and for all items less food and energy were both unchanged in March. Within energy, an increase in the electricity index was offset by declines in the indexes for gasoline and natural gas. Within all items less food and energy, the indexes for medical care, new vehicles, and used cars and trucks posted increases, while the indexes for shelter, household furnishings and operations, and apparel declined. China market consumed some quantity mainly on W320 and DW. W320 traded at USD 6.30/6.35, W450 at USD 5.97, DW at USD 5.40 per kg for prompt shipments. Efforts on selling imported raw seeds have been seen during the past week. Offers were being made with good prices as well as promotions but buyers chose to wait a little bit to see the progress of kernels market in the coming weeks whether it is positive or negative.

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A Product of www.CashewInfo.com FOB prices of cashew grades in Vietnam that sold last week for April 2010 Grades W-240 W-320 W-450 LBW-320 DW WS WB LP 04/17/10 2.95 2.75-2.77 2.50 2.55 2.18 2.15 2.18 1.50 04/24/10 2.95 2.75-2.77 2.50 2.55 2.20 2.18 2.20 1.55

Market CommentaryCashew BulletinIts been another relatively quiet week although the market moved back up a little on enquiries from buyers in the USA. The European market is not particularly active but it is clear now that unsold inventories in Europe are low. It is difcult to nd any good quality material for sale in the Rotterdam spot market and prices reect that. In general some of the economic indicators are more encouraging for demand and we may see better activity although perhaps not a change to the current buying pattern. Overall sentiment among buyers remains negative/neutral and a continued cautious approach is the most likely scenario. This may be inuenced by a strengthening US dollar, which will keep buyers away and should reduce prices if it continues. Longer term European demand looks stable to growing slowly whereas the much more price sensitive USA market may reduce purchases at the current levels and the chances of sales promotions seem slight. Supply side we saw more offers this week albeit at higher prices. It seems clear that processors would make sales for prompt and forward if the enquiries were in the market. This is not to say they seem under pressure but just that current levels for kernels and RCN make a protable calculation. You can follow Cashew Bulletin on twitter.com.

Mr. Kees Blokland, The Netherlands Market is calm. Buyers are just awaiting further developments. Customers are showing some interest to check prices but no real business is committed. FCA Rotterdam Prices (USD / lbs)

Grades 04/17/10 W 240 3.05 W 320 2.95-3.00 W 450 2.75 (Prices are indicative)

04/24/10 3.15-3.25 2.95-3.00 2.75

Disclaimer: The prices quoted in this report are sourced from reliable trade sources. However, these could vary on account of varietal, seasonal, payment terms and conditions and so on. Readers are advised to take these rates for indicating purposes only to note the direction of the trend. Foretell Business Solutions Private Ltd., is not be responsible for inaccuracy in prices, if any.

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A Product of www.CashewInfo.com FOB Prices of cashew nut in USD /lb (Cochin/Tuticorin) Grades W-240 W-320 W-450 WS/FS WB/FB SW320 SW360 SSW LP/LWP 04/17/10 3.00-3.05 2.80-2.85 2.60-2.65 2.30 2.25 2.65 2.50 2.00 1.65 04/24/10 3.05-3.10 2.85-2.90 2.70 2.35 2.30 2.70 2.55-2.60 2.10-2.15 1.65

FOB Price MovementCurrency Brazilian Real Chinese Yuan Singapore Dollar Tanzanian Shilling Thai Baht Mozambique New Metical Vietnam Dong Indonesian Rupiah Benin CFA Franc BCEAO 04/17/10 1.76 6.83 1.37 1358.5 32.18 31.51 19005 9017.5 475.35 04/24/10 1.759 6.83 1.37 1378.5 32.22 34.14 18885 8983.5 483.41

Note: W = Whole White, SW = Scorched Wholes, SSW = Scorched Wholes Seconds, LWP = Large White Pieces, WS = White Splits, WB = White Butts, FS = Fancy Splits, FB = Fancy Butts, SS = Scorched Splits, SB = Scorched Butts, SP = Scorched Pieces, LP = Large Pieces Average FOB prices (USD /lb) of W-320 grade Kernel (2009-10 vs.2010-11)3.60 3.40 3.20 3.00 2.80 2.60 2.40 2.20 2.0015-Jul 21-Feb 10-Mar 25-May 21-Sep 11-Nov 28-Nov 18-Aug 15-Dec 21-Apr 27-Mar 11-Jun 28-Jun 18-Jan 8-May 4-Sep 25-Oct 1-Aug 4-Apr 4-Feb 1-Jan 8-Oct

US Dollar vs. INR MovementIndian rupee gains to continue Indian rupee this week moved in the range of 44.74 and 44.36 and nally settled lower at 44.4375 levels on Friday. Rupee appreciated on the back of strong gains in Indian sensex and dollar index inability of holds on to the recent gains. RBI hikes the CRR by 25 bps from 5.75% to 6% effective April 24th. RBI also raised the key repo and reverse repo rates by 25 bps each with immediate effect In the last three weeks rupee is moving in the broader range of 44.15 and 44.78 levels. On the higher side upside capped initially at 44.78 and above to move higher till 4545.20 levels. At the same time down side is limited to 44.15 and below to drop till 43.90-43.70 levels. Overall rupee to move in the broader range of 43.70 and 45.20 levels in the commencing one to two weeks time period.

2009-10

2010-11

2.90 2.9 2.8 2.33

After being quiet for a long time, Cashew market has witnessed some activity in the current week. USA demand was more in the market and the price have moved up a few cents. The FOB price for W-320 grade kernels was quoted at USD 2.85-2.90 per lb this week against USD 2.80-2.85 per lb last week. Forex Rates (in US $) Currency Indian Rupee Euro Japanese Yen

04/17/10 44.53 0.74 92.17

04/24/10 44.35 0.747 93.935

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Special Coverage

Cashew once meant for export loosing its wayCashew, considered as a luxury commodity, was mainly meant for export till recently. In the recent years we have seen a changing trends in cashew exports, which fell in to the negative growth zone. Cashew export growth in the last ve years is registered a decline of 2.68 per cent. This could be mainly attributed to the increasing domestic demand, which could be triggered by various reasons coupled with narrowing price parity between the export and domestic earnings to the exporters. Cashew traders are nding a better place for their cashews in domestic market as the cashew consumption is increasing in India. Higher purchasing power along with increasing health conscious lead the consumers, especially the youth towards more cashews in the form of snacks, ingredient in food items etc. In the National Sample Survey Organization (NSSO) survey on household consumer expenditure is also reporting that the share of expenditure on dry fruits is increasing both in rural as well as in urban regions. Cashew exports in the current year (2009-10) has reported a 1.28 per cent decline to 108,120 tons from 109,522 tons a year ago. The average prices fell to Rs.268.76 a kg from Rs.272.86 a year ago that resulted in a drop in earnings too. In the meantime, raw cashew imports has registered a growth of 24.26 per cent to 752,854 tons from 605,850 tons a year ago. The average cost of imported raw cashew, however, fell to Rs.40.34 a kg from Rs.43.45 a year ago. It is obvious that cashew kernels are nding their way into the robust domestic market. Another reason behind the fall in exports was the tough competition from Vietnam and Brazil, which over took Indias rst position in 2007-08. Vietnam is gaining momentum on Indias fall in exports and is now claiming to export 50 per cent more than India. Brazil, which is the second largest producer of raw cashew, also became a competitor mainly in the US and CIS markets. The major buyers of cashew kernels from India are USA, Netherlands, UK, Japan, UAE, France, Canada and Saudi Arabia.Indian Cashew nut im ports vs kernal exports (tons)

800000 750000 700000 650000 600000 550000 500000 450000 400000

130000 125000 120000 115000 110000

Imports

Exports

105000 100000

03 20

4 -0

04 20

5 -0

05 20

6 -0

06 20

7 -0

07 20

8 -0

08 20

9 -0

09 20

0 -1

The domestic cashew processing industry requires around 1.2 million tons of raw cashew a year to meet export and domestic demand. At present, domestic output meets less than 50 per cent of the requirement. This situation made India to become a net importer of cashew with value of imports overshadowing the value of exports despite the potential of value addition in processing of raw cashew and reexporting it. When cashew export fell in to a negative growth phase imports are growing at a 4.5 per cent annually. Domestic demand is also growing at a 5.3 per cent annually. However, the industry is optimistic that the current year will be a good year with more exports.

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Exporters GuideExporters Guide: India

Section II: Exporter Business Tips G. Business Etiquette Although Hindi is Indias leading national language, most Indian ofcials and business people have an excellent command of English. Most Indian businessmen have traveled abroad and are familiar with Western culture. Business is not conducted during religious holidays that are observed throughout the many regions and states of India. Verify holiday information with the Consulate or Embassy before scheduling a visit. Indian executives prefer late morning or afternoon appointments between 11:00 a.m. and 4:00 p.m. Indians often have longer meetings, so be sure to leave plenty of time between appointments. The climate in India can be very hot for most part of the year, so it is advisable to wear lightweight clothing to avoid discomfort. Men should wear a jacket and tie (and women should wear corresponding attire) when making ofcial calls or attending formal occasions. Always present a business card when introducing yourself. Refer to business contacts by their surname, rather than by their given name. Use courtesy titles such as Mr., Mrs., or Miss. Talking about your family and friends is an important part of establishing a relationship with those involved in the business process. Hospitality is a key part of doing business in India; most business discussions will not even begin until chai (tea), coffee, or a soft drink is served and there has been some preliminary small talk. To refuse any beverage outright will likely be perceived as an insult. While an exchange of gifts is not necessary, most businessmen appreciate token momentos, particularly if they reect the subject under discussion. Business lunches are preferred to dinners. Try to avoid business breakfasts, especially in Mumbai. The best time of year to visit India is between October and March, so that the seasons of extreme heat and rains can be avoided. Although Delhi (the capital) has a cool, pleasant winter (November - February), summers (April July) are erce with temperatures of up to 120 degrees Fahrenheit. Mumbai (the business hub) and most other major cities have a subtropical climate hot and humid year

around. Most Indian cities have good hotels and are well connected by domestic airlines. The following websites were found to be informative and user-friendly in providing information on Indian business culture and business etiquettes. These websites are mentioned for readers convenience; USDA/FAS does NOT in any way endorse, guarantee the accuracy of, or necessarily concur with the information contained in the below sites: http://stylusinc.com/business/india/cultural_tips.htm, www. executiveplanet.com/index.php?title=India H. Import Duties Imports into India are subject to a high and often confusing array of duties, which include the following: a basic duty, an Additional Duty (AD), also known as Countervailing Duty (CVD), and an Education Cess (a special surcharge on all direct and indirect taxes at 2 percent introduced in the July 8, 2004 Budget, which was increased to 3 percent in the 2007 Budget). A special Countervailing duty (SCVD) of 4 percent was introduced in the 2005 GOI Budget on all imports (agricultural and non-agricultural) with a few exceptions. This was done to account for the VAT and other taxes applicable only to domestic products. Agricultural products exempted from the CVD include fresh vegetables and fruits, seeds, raw wool, poultry and cattle feed, pulses, rice, wheat, and coarse grains. The basic duty on most processed food products is 30 percent. Exceptions in the agriculture/food group include sensitive items such as wine, liquor, poultry meat, wheat, rice, corn, coffee, tea, vegetable oils, cigarettes and tobacco, and several dairy products, which attract much higher basic duties. However, due to food ination, the import duty on wheat, rice, corn and crude vegetable oils currently remains zero. The CVD equals the excise duty on similar products produced domestically (16 percent on most consumer food products), and is levied on the total of the assessed value plus the basic duty. The calculation of the CVD on packaged goods

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A Product of www.CashewInfo.com is based on the Maximum Retail Price (MRP), minus the abatement notied for similar domestic goods in India, which makes the calculation more difcult. Total import tariffs on most consumer food products range from 36.1 percent to 59.1 percent. I. Food Laws Food exporters will have to grapple with Indias varied food sector laws, particularly those pertaining to the use of additives and colors, labeling requirements, packaging, weights and measures, shelf-life, and phytosanitary regulations. Following the removal of quantitative restrictions on imports of food products in 2001, the GOI issued several notications to make imported food products comply with domestic laws. Details on Indias food laws are available in our Food and Agricultural Import Regulations and Standards Country Report 2008 (IN8082), which can be accessed via the FAS/USDA website: www.fas. usda.gov. On August 24, 2006, the GOI notied, in the ofcial gazette, the Food Safety and Standards Act, 2006 to bring about an integrated food law. The new Food Safety and Standard Authority has been formulated and has initiated the rule making process. Some of the major food laws affecting Indian food importers are: The Prevention of Food Adulteration (PFA) Act, 1954, and PFA Rules of 1955, as amended. This is a basic statute established to protect consumers against adulterated foods, and it encom-

Exporters Guidepasses food colors and preservatives, pesticide residues, packaging, labeling, and regulation of sales. This is similar to the Federal Food, Drug, and Cosmetics Act of the United States Food and Drug Administration. Standards and regulations of the PFA apply equally to domestic and imported products. The PFA Act and Rules, and recent notications are available at: http:// mohfw.nic.in/pfa.htm The Standards of Weights and Measures Act, 1976, and the Standards of Weights and Measures (Packaged Commodities) Rules, 1977, as amended. This Act established standards for weights and measures to regulate interstate trade and commerce in goods that are sold or distributed by weight, measure, or number. The Rules formed under the Act require labeling regarding the nature of the commodity, the name and address of the manufacturer, quantity, date of manufacture, best-before date, and the MRP. These labeling requirements apply equally to imported and domestic packaged foods. The Plant Quarantine (Regulation of Import into India) Order, 2003, and amendments. These legislative measures regulate imports of planting seeds and agricultural products into India. These can be accessed from: www.plantquarantineindia.org/PQO_amendments.htm

(Compiled from USDA Foreign Agriculture Service GAIN Report Number: IN8112) (To be continued)

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News Highlights

NEWS HIGHLIGHTSCashew production seen down 8-10% in 2009-10 Unseasonal rains and high temperature in the last few months of 2009 have reduced cashew yield by 8-10%, according to Directorate of Cashew and Cocoa Development (DACCD). Rains in most producing states in October and November proved bad for the standing crop, Venkatesh Hubballi of DACCD. The erratic rains were followed in November and December by high day time temperature which again affected the nal production, he added. According to the crop estimate prepared by the agency, Indias production would be around 6.3 lakh ton in 2009-10 as against 6.95 lakh ton in 2008-09. In 2007-08, the country produced around 6.65 lakh ton of cashew. India has to import more than half of its requirement of raw cashew because of low domestic output. Imports of raw cashew were almost 23% more in the rst eleven months of last scal. It is obvious that cashew kernels are nding its way into the robust domestic market. Traders said Indias cashew consumption could be a trigger point in global trade in the coming days given the huge size of the market and growing retail sector. Indias per hectare cashew productivity is almost three to four times less than that of Vietnam. While Vietnam produces 34% of the worlds cashew from just 10% of the worlds cashew farming area, India, on the other hand, has the largest share of land under cashew (24%) but has a share of only 19% in the total production. Productivity in Vietnam is 2.8 ton of cashew nuts per hectare, while the average productivity in India is only 663 kg per hectare. The credit for highest productivity in India goes to Maharashtra with 1.1 ton per hectare. The state has also displaced Kerala as the largest producer of cashew with 25% of the total production. Cashew production is likely to get a boost with the government doubling the subsidy provided for cashew re-planting, Venkatesh Hubballi said. From April 1, farmers will get Rs.20,000 per hectare for re-planting as against Rs.11,250 in the past. This should encourage farmers to re-plant cashews in more area,Hubballi added. The directorate is taking steps to increase the area under farming by 50,000 hectare (ha) by 2012. The government body has decided to take up cashew cultivation in a big way in states like Chhattisgarh, Jharkhand, and the northeastern region under the 11th Five Year Plan Period. From the present farming area of 874,000 ha, the directorate hopes to increase it by 15% increase which will help in reducing the import of raw cashew kernels, for which the nation depends on African nations. In traditional areas, the directorate hopes to replant up to 10,000 ha to increase productivity Mozambique records highest cashew crop in 3 years Mozambique has reported the biggest cashew nut production in three years. The once world cashew export leader sees its industry recovering slowly. According to reports from the country, the seasons production has topped 95,000 tons, mostly thanks to favourable weather conditions. The director of the national cashew institute (INCAJU), Filomena Maipu was reported in the local press saying the southern part of the country was the most fortunate and suitable to have achieved the bumper crop. The national cashew nut institute said this years produce also well within the target of 100,000 tons of raw cashew, also adding that the price was also very good for the farmers this year. Mozambiques cashew season starts in October and ends in March, but due to extended owering of cashew trees this season as well as the selling period, it is expected that the season will be extended to the end of April. While this years cashew crop is among the best during the last decade, production is however still signicantly lower than in the peaking 1970s, when Mozambique was the worlds leading producer. The civil war and poor maintenance brought the cashew industry to its knees by the mid-90s.Since then, however, massive investments in cashew production has seen Mozambiques main cash crop to recover slowly.

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A Product of www.CashewInfo.com Cashew exports recover in H2 Cashew exports from India in 2009-10 overcame the sluggishness of the rst half to nish marginally behind 2008-09, Cashew Export Promotion Council (CEPC) sources said. However, India has become a net importer of cashew with value of imports overshadowing the value of exports by 4.5% in the nancial year despite the potential of value addition in processing of raw cashew and re-exporting it. It is obvious that cashew kernels are nding their way into the robust domestic market, sources said. According to gures provided by CEPC, exports in AprilMarch 2009-10 fell short by 2.7 % in value terms and 1.2 % in volume terms as compared with the same period of 2008-09. Dollar realization for the scal was lower by 6% over the previous scal. Unit value of exports was lower by Rs.4 per kg at Rs.268.76 per kg in 2009-10. In the rst half of FY09-10, volume and value of exports were lower by 12%. Cashew exports were lower as buyers reduced their forward covering to six months from the usual practice of one year. With sellers refusing to lower their prices, trading during the important month of September remained low and quiet. Shipments from Vietnam and India, the two largest exporters, were down by almost 10% during the st ten months of 2009 calendar year. However, things improved during the rst three months of 2010 with exports picking up, sources at CEPC said. In March 2010, volume of exports was higher by 3.2% and value higher by 5.38% over the same period last year. Exporters who were hoping for good contracts in the last quarter of 2009 were disappointed with retailers not covering for long. Trade sources said the rst quarter of 2010 will be a decisive period. If buyers feel that consumption would be back to normal levels like other commodities, their demand would be signicant. Import of raw cashew in 200910 was higher by 15 % in value terms and 24% in volume terms. Indian production for the same period was lower by 8%-10% according to an estimate by the Directorate of Cashew and Cocoa Development.

News HighlightsCashew exports down in 2009-10 Cashew exports from the country during 2009-10 declined 1.3 per cent in volume and 2.8 per cent in value on stiff competition from other suppliers in the world market. Total shipments during the last scal stood at 1,08,120 tons valued at Rs.2,905.82 crore ($612 million) against 1,09,522 tons worth Rs.2,988.40 crore ($649.79 million) the previous nancial year. The average unit valued realised in 2009-10 was Rs.268.76 a kg against Rs.272.86 a kg a year ago. The Chairman of Cashew Export Promotion Council of India (CEPC), Mr. Shahal Hassan Musaliar, said the main reason for the decline last scal was competition from other producing countries Vietnam and Brazil. He said India enjoyed the number one position in the world market till 2007-08. During the last ve years, exports declined 10.5 per cent and Vietnam took advantage of it. Its export increased 67 per cent during this period and is now claiming to export 50 per cent more than India. On the other hand, Brazil, which is the second largest producer of raw cashew, also became a competitor mainly in the US and CIS markets. Strong Rupee The rupees appreciation against the dollar has also contributed to the declining trend. In contrast, the Vietnam devalued its currency in three phases by 15 per cent. During this period, the rupee appreciated against the dollar by over 14 per cent. As a result, we have become about 30 per cent less competitive in price terms against our major competitor and the export earnings have been lower than the levels budgeted for raw cashew nut procurement. Next was the global recession, which had a severe impact on the cashew industry with demand from the US and Europe dropping. Consequently, the prices and volume of sales fell in the international market. Export ban Added to this was the ban on export of agriculture products to Russia in 2008 that remained in force for

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A Product of www.CashewInfo.com two years. During this period Vietnam captured the Russian and CIS markets. According to Mr. Musaliar, banks are not allowing exporters to avail themselves of enough Foreign Currency Packing Credit, citing non-availability of dollars. Exporters are forced to avail themselves of rupee packing credit at 7 to 9.5 per cent. The sharp appreciation of the rupee has also taken a toll. He said that costs of raw cashew nuts and processing had gone up. Even though the Government announced that service tax exemption would be granted for export activities, cashew exporters are being levied service tax for transport of goods from farm/ port to factory and from factory to port, commission paid to foreign agents, etc. All these have added to the cost of production. At the same time inadequate availability of domestic raw nuts has forced the industry to depend on imports, he said. Our domestic production is around 7 lakh tons while our processing capacity is about 14 lakh tons. Hence we have to depend on imported raw cashew nut for more than half of the requirement. Vietnam is also competing with our processors for sourcing raw cashew nut from African producing countries, resulting in increase in raw cashew prices, he said. Other surrogate nuts such as almonds, macadamias are being promoted in the major world markets on the basis of health claims and large amounts are being spent by the grower associations, supported by the Governments. Since cashew is produced by developing or least developed countries, the farmers are not in a position to spend large amounts for promotion, Mr. Musaliar pointed out. On the rise in imports of raw nuts, which had gone up by 24.26 per cent in 2009-10 from the previous scal, the CEPC Chairman said, Our domestic production is around 7 lakh tons while our processing capacity is about 14 lakh tons. Hence, we have to depend on imported raw cashew nut for more than half of the requirement and for protecting the employment of thousands of cashew factory workers. Four tons of raw cashew nut need

News Highlightsto be processed for producing one ton of cashew kernels. India imported 7,52,854 tons of raw nuts valued at Rs.3,037.35 crore in 2009-10 as against 6,05,850 tons valued at Rs.2,632.41 crore in 200809. The import value increased by 15.38 per cent while the unit import price by 7.71 per cent. On the current trend, he said, the rupee is strengthening and the effects of recession and nancial crunch are continuing. However, the factories need to be run for providing employment to lakhs of workers. Therefore, at this critical juncture, the industry needs the full support of the Centre for survival. Mr. Musaliar expressed the hope that cashew may be included in the priority sector along with leather, handlooms, handcrafts, etc, for support from Government. We hope the recession will be over and trade will increase during the second half of the current nancial year and exports pick up to reach Rs 3,000 crore. Nuts sector 20 p.c. below its capacity The processing capacity of cashew nuts and macadamia in the country is underdeveloped and, therefore, more investors should be encouraged to join the sector. With only about ve large processing plants and a handful of other small players, the sector is believed to be operating at only 20 per cent its maximum capacity. According to industry players, there are efforts to increase the capacity from within as well as foreign investors, to use the capacity. We are increasing the capacities and also engaging with investors who have shown interest in putting up processing plants locally to match up, Mr Bobby Thomas, a director of Wonder Nuts, told the Nation on Thursday. Last year, the government imposed a ban on the export of nuts from the country as means of boosting the industry. The ministry of Agriculture indicated that it was only the National Cereals and Produce Board (NCPB) that was mandated to buy the nuts from farmers. Before then, a number of exporters had a eld day buying nuts and exporting it to countries like China, Vietnam and India. This, the ministry argued, denied

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A Product of www.CashewInfo.com the country opportunities for employment and value addition. Currently, the production of nuts is estimated at about 10,000 metric tons annually. Some processors have also urged the government to focus on increasing production by providing incentives to farmers as the ban stays on to protect them. Lifted However, the issue cropped up in Parliament recently, with a member asking for the ban to be lifted. Through a ministerial statement, the ministry remained adamant, insisting the ban was there to stay. Foreign exporters destabilised the market and in the last three years farmers suffered immense losses due to middle men. After the ban, prices shot up and if post harvest regulations are followed, and the quality will improve and the buying price will shoot higher next year, read the ministerial statement in Parliament. Statistics from the ministry further indicate that the sector currently earns the country only Sh500 million annually, but has a potential value of Sh1 billion. Cashew nut growers lose out over low output The low level of cashew nut production is blocking processors from setting up plants in the country causing farmers huge losses. The Kenya Cashew Nuts Processors and Exporters Association chairman Samuel Varghese stated that based on current production, it is not economically viable for members to put up processing units in the country. Kenya currently produces 11,000 metric tons. Following a ministerial ban of the export of raw nuts last year, exporters have shifted their bases to Tanzania, Mozambique and Ghana where they are getting enough nuts for their export market, Mr. Varghase said. The ban was meant to encourage local processing. The government and other industry investors had pegged their hope on the fact that the higher quality Kenyan nuts would force exporters to establish processing units to protect their market in India. Mr. Varghase stated that, we have substituted the Kenyan nuts with those from elsewhere in Africa, which are also of high quality. The government should have rst focused on increasing production to about

News Highlights60,000 metric tons perhaps in less than 10 years and then ban the export of raw nuts. He said that importing countries prefer to buy raw nuts, for which they give high rebates since by exporting them the exporters were creating jobs. This has made the business highly protable. Mozambique produces about 90,000 metric tons of cashew nuts. Most of the produce from Tanzania nds a market in the United States, Europe, Japan and India. On average, Tanzania produces about 100,000 tons of the crop every year, mainly for export. Ghana exports some 45,000 tons of raw nut every year. Mr. Varghase stated that, the government will this year lose $10-15 million (Sh770m-Sh1.15bn) in foreign exchange as a result of the ban. Major exporting rms that relocated from Kenya include Emke Commodities, Export Trading, Donal International and Jumba international. They all registered companies in Tanzania last year when the government indicated the impending ban. Most of the processors have stocked on enough nuts and left the eld before the season came to a close. They went for the high quality nuts and left farmers with a huge volume of low quality nuts that will not fetch better prices. Farmers are calling us to buy the nuts, but our hands are tied by last years ban. Farmers say that the ban only favoured a few processors and did not consider their plight. Farmers in the leading cashew nut producing areas of Lamu and Kili are holding huge volumes of nuts in their stores. The middlemen now buying the nuts are offering Sh17 per kg. A farmer in Mpeketoni, in Lamu, Mr. Julius Thuo said that the local cashew nut processors offered between Sh32-37, compared to between Sh50 and Sh60 offered by exporters last season. We want the ban lifted to encourage competition so that farmers can earn better prices, Mr. Thuo said, adding that the farmers who cultivate cashew nuts as a commercial crop, especially in Mpeketoni, will now be forced to abandon the crop due to low prices. The production of the cashew nuts in the country has been on a decline reaching its lowest record of

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A Product of www.CashewInfo.com 10,000 tons last year compared to 14,000 metric tons three years ago, according to statistics from the Ministry of Agriculture. Income generated by the cash crop also declined from $3.75 million (Sh290m) to $3.25 million (Sh250m) during the same period. Experts said that the current processors lack the capacity to handle more than 12,000 metric tons. The Kenya Nuts Ltd eld ofcer, James Ndegwa, stated that the company has the capacity to process 8,000 metric tons. Indias food ination surges to 17.65% The annual food ination, based on the wholesale price index, rose 17.65 per cent during the week ended April 10, marginally higher than an annual rise of 17.22 per cent in the previous week. The fuel price index increased 12.45 per cent in the week to April 10, a tad higher than an annual rise of 12.43 per cent in the previous week, data released by the Ministry of Commerce and Industry showed on Thursday. Primary articles According to the data, the WPI for the Primary Articles group gained 0.6 per cent on a sequential basis to 289.7 points from 288.0 points for the previous week. The annual rate of ination in the Primary

News HighlightsArticles group, calculated on point-to-point basis, stood at 14.14 per cent points for the latest week compared with 13.88 per cent points for the previous week and 6.42 per cent during the corresponding week of the previous year. Sequentially, the index for Food Articles group was up 0.7 per cent due to higher prices of fruits and vegetables (3 per cent), sh-marine (2 per cent) and condiments and spices, arhar and moong (1 per cent each). However, the prices of wheat and eggs (1 per cent each) declined. Non-food articles The index for Non-Food Articles group rose 0.5 per cent due to higher prices of groundnut seed and castor seed (3 per cent each) and raw silk, sunower and copra (1 per cent each). However, the prices of gingelly seed (5 per cent) and linseed (1 per cent) declined. The Fuels index increased 0.1 per cent to 363.2 points from 362.7 points for the previous week, due to higher prices of light diesel oil, petrol and high speed diesel oil (1 per cent each). However, the prices of furnace oil (1 per cent) slipped.

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Indian cashew kernel prices

Domestic Prices of NutsCashew Grades W180 S180 W210 S210 W240 S240 W320 W1 SW SSW JH S LWP SWP K JB W180 W210 W240 W320 W450 SW240 SW210 S (Splits) SS Butts SB (Scorched Butts) SP LWP WSP W320 No. W210 No. W240 No. W180 No. 2 pieces 04/17/10 5700 5100 4700 4300 4250 3900 3700700 3550 3400 3200 3200 3050 2775 2550 2950 3100 Kollam (Rs/22.68 kg) 9200 8200 7600 6800 6200 6400 7000 6100 4800 5200 4600 4300 5200 4500 Delhi (Rs/Kg) 350 455/460 380/385 490/500 285/300 350 455/460 380/385 490/500 285/300 9200 8200 7600 6800 6100 6400 7200 5900 4800 5200 4600 4300 5200 4500 04/24/10 5700 5100 4700 4300 4250 3900 3700700 3550 3400 3200 3200 3050 2775 2550 2950 3100 Cashew Grades 4 pieces 8 pieces W320 W210 W240 W180 2 pieces 4 pieces 8 pieces W180 W210 W240 W320 W400 S240 S320 S K LWP SWP JH W210 W240 W320 SW JH K/LWP W1 JB/Butts W400 2 Pieces 4 Pieces 8 Pieces W 320 04/17/10 225/260 180/240 Sangrur (Rs/Kg) 390 470 380 425/435 300/310 280/285 215/225 Jeypore Orissa (Rs/Kg) NS 450 380 330 295 370 320 290 265 255 235 300 Vetapalem AP (Rs/Kg) 425 375 330 300 330 260 300 275 300 Bhubaneswar (Rs/Kg) 260 235 205 290 270 250 210 285 390 350 320 280 310 260 300 260 300 NS 450 380 330 295 370 320 290 265 255 235 300 385 465 375 420/430 300/310 280/285 215/225 04/24/10 225/260 180/240

Mangalore (Rs/11.34Kg) (without tax)

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Indian cashew kernel prices

Other Nuts prices at Delhi marketGrades Almond Girdhi New (Rs/40Kg) Almond Gurbandhi New (Rs/40Kg) Almond California (Rs/40Kg) Almond Kernel California (Rs/Kg) Almond Kernel Gurbandi (Rs/Kg) Pistachio Irani (Rs/Kg) Pistachio Hairati (Rs/Kg) Pistachio Peshawari (Rs/Kg) Walnut New (Rs/Kg) Walnut Kernel (Rs/Kg) 04/17/10 2400/2600 4700/4800 11000 375/378 305/380 850/950 1550/1600 1700/1800 80/150 300/450 04/24/10 2600/2800 4700 11100 383/385 305/380 840/900 1500/1550 1700/1750 80/150 300/450

Cashew Nuts prices ($/ton C&F)Country Indian RCN (Rs./80 Kg bag) Benin IVC 04/17/10 4800 965 04/24/10 3700-4000 960

820 750-870 Note: Indian RCN is quoted in rupees.

*Mangalore Prices are for 11.34 Kg tin and exclusive of tax. Tax for inter-state sales- CST 3%, Tax for local sales 4% VAT. Note: W= White Wholes, SW= Scorched Wholes, SSW= Scorched Wholes Seconds, DW= Dessert Wholes, S= Splits, LWP= Large White Pieces, SWP= Small White Pieces, BB= Baby Bits, SB= Scorched Butts, SS= Scorched Splits, SP= Scorched Pieces, I tin =11.34kg, 1kg = 2.24lb

Disclaimer:Foretell Business Solutions Pvt. Ltd. is not responsible in any form for the trade or trade related activities by the subscribers or members of public based on the research ndings published in this product. Note: The content published in this product cannot be published or reproduced in any form without the written permission from Foretell Business Solutions Pvt. Ltd

Raw cashew nut prices in Rs/quintalState Andhra Pradesh Markets Chirala Narsipatnam Tuni Sompeta Gunpur Pernem Puttur Karkala 04/17/10 5000 5600 5550 4000 5100 5950 5050 4600 04/24/10 5040 5600 5550 4000 5000 5800 4200 4600

Orissa Goa Karnataka

Source: Agricultural Marketing Information Network Note: Prices are weekly average

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Trade Events

TRADE EVENTSFOODAGRO Addis Ababa Exhibition Center, Addis Ababa, Ethiopia Apr 27-30, 2010 Agriculture Food & Packaging Industry Exhibition Lithuanian Exhibition and Convention Centre (LITEXPO), Vilnius, Vilniaus Apskritis, Lithuania Apr 29- May 1, 2010 International Food Exhibition Philippines World Trade Center Metro Manila, Manila, Metropolitan Manila, Philippines May 6-8, 2010 Foodmash Crocus Expo International Exhibition Center, Moscow, Moskva, Russia May 11-14, 2010 Foodtech Bulgaria International Fair Plovdiv, Plovdiv, Bulgaria May 11-16, 2010 Cibus Parma Parma Exhibition Centre, Parma, Emilia-Romagna, Italy MAY 10-13,2010 Dolce Italia Parma Exhibition Centre, Parma, Emilia-Romagna, Italy MAY-10-13, 2010 Bakery China Shanghai New International Expo Centre(SNIEC), Shanghai, China MAY 11-13,2010 China Food Industry & Food Export Fair Qingdao International Convention & Exhibition Center, Qingdao, Shandong, China May 11-13,2010 SEOUL FOODTECH Kintex - Korea International Exhibition Center, Goyang, Korea May 12-15, 2010 Thaifex-World of Food Asia Impact Exhibition & Convention Center, Bangkok, Thailand MAY 12-16,2010 Food Technology Exhibition Moldexpo International Exhibition Centre(IEC), Chisinau, Moldova MAY 12-16,2010 INTERNATIONAL FOOD INDUSTRY EXHBITION SEOUL Kintex - Korea International Exhibition Center, Goyang, Korea MAY 12-15,2010 China International Foodstuff Exposition Chinese Export Commodities Fairground, Guangzhou, China MAY 13-15,2010 China Food Machinery & Packaging Exhibition China Import & Export Fair Pazhou Complex, Guangzhou, China MAY 13-15,2010 Irresistible Gluten Free Food Show-Brisbane Brisbane Convention & Exhibition Centre, Brisbane, Australia MAY 15-16,2010

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cashew price

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