Cashew Nut Market Update - March 2022

Demand for Cashews and nuts in general has been fueled by strong retail performance, as consumers look for health boosting foods – of which Cashews are one. The current low pricing environment has supported the demand and is likely to continue to do so for the foreseeable future. This presents an upside to potential to prices, although strong imports and stock holdings in the EU and US are good (especially for W320). The Russian invasion of Ukraine has caused some uncertainty, and should the conflict escalate further, soaring energy prices may have more of an impact on production and pricing for both material and transport costs. The INC estimates that global cashew production to be 3.95 million tons (2021/22) an increase of 3% on the year. This has been driven by gains in the Ivory Coast, India, Cambodia and Brazil.

India:

Early estimates for Indian crop suggest similar levels to 2021 of 738,000 tons. Some market sources expect the output to fall year on year as a result of above average rainfall during the monsoon season in October to December. Demand in the coming months is expected to rise as a result of the summer wedding season and covid-19 restriction easing. Larger sized kernel stocks have been increasing, which may have downwards pressure on pricing if packers and distributors need to move stock.

Africa:

Production in East Africa is predicted to be steady (year on year) and Tanzania is forecasted to produce 220,000 tons of Cashews and Mozambique is expected to produce 55,000 tons. Tanzania’s total sold Cashews sold via auction at the end of January was 230,000 tons – this exceeds the INCs estimate of 10,000 to 20,000 tons and is also said to be very good quality. In the Ivory Coast, a new marketing campaign was launched mid-February, with the industry also targeting output of 1 million tons for the year. So far, weather has been good for crop growth and development. Last year the Ivory Coast output reached 1 million tons, an increase of 11%% year on year according to the INC. Sources predict total yield to be around 970,000 tons – going to show that packers are keen to keep up the momentum created last year.

Vietnam:

So far this season, growing conditions in Vietnam have been good. Despite the heavy rains which fell, crop yield is expected to be good, and minimal damage to occur as a result – only a possible short delay in harvest. Carry over for Vietnamese RCN is expected to be in the realms of 400,000 to 500,000 tons, following a surge of imports in 2021 which totaled 2.9 million tons. Good stock holdings are adding to the increasing downwards pressure on price, which is expected to plateau at some point given that packers will be hesitant to sell their product at a loss to increase the demand again. 2021/22 Cashew production reached 400,000 tons, 11%less than in the previous season.in 2021, Vietnam exported a total of 609,260 tons of cashews, an increase of 17% on the year. It is expected that 2022 will see a further 4% growth. In 2021/22 the EU imported a total of 120,000 tons of Vietnamese Cashews – an increase of 9% in comparison to 2020 and 28% in comparison to a 5-year average. The United States imported a total of 163,169 tons of cashews in 2021, this is an increase of 9% year on year and 18% compared to a 5-year average.