Cashew export prices on the up

The quantity of cashew nuts exported from Vietnam in the first seven months of this year is reported to have reached 84,000 tons with a turnover of US$656 million , according to Nguyen Thai Hoc, chairman of the Vietnam Cashew Association (Vinacas).

Volume declined 16 percent but the value was up 14.8 percent, Hoc said.

A jungle of cashew in the southern province of Dong Nai. The quantity of cashew nuts exported from Vietnam in the first seven months of this year is reported to have reached 84,000 tons ( Photo: A. Quan)

The average export price in the period was US$7,600 per tonne compared to US$5,300 last year.

Raw cashew output for the whole year was likely to be slightly less than previous years at 330,000 tons due to unseasonable monsoon rains and the advanced age of many cashew trees.

In the first half processors had imported 120,732 tons of raw cashew from Nigeria , Ghana , the Ivory Coast , Indonesia , and Cambodia .

To achieve the export target this year, some 329,300 tonnes were expected to be imported in the second half.

With lower world output and increasing demand, prices would remain high this year.

But exporters should only sign export deals when they had the nuts in hand, he said.

The Ministry of Agriculture and Rural Development (MARD) said full year's exports were expected to be US$1.32 billion from 163,000 tons, a 17.6 percent fall in volume but 16 percent increase in value.

Average cashew export price this year would be around US$8,098 per ton, it added.

The increased export price has made local purchasing prices higher. By the end of July, the purchasing price of dried cashew nuts fluctuated between VND 39,500 - VND 40,000 per kg VND2,000 - VND 4,000 per kg higher than the previous month. The price of fresh cashew nuts also rose to between VND 6,000 - VND 8,000 per kg.

According to Vinacas, there will not be much change in the remaining months. If demand increases, prices may rise in August and September. The price of cashew kernels may fall sharply within the next three or four months, but the decreased sales volume in the first half of this year makes this unlikely. In addition, the cashew reserves of importers are now very low, forcing them to buy unprocessed cashews to meet their demand.

Vinacas predicts that the price increase in food and foodstuffs in local markets can raise the price of cashew nuts. The stocked volume of cashew kernels in the US and EU remain low, while China and India will have a large demand by year's end.

In addition, the Ministry of Finance has issued a circular to revise the export tax levied on cashew nuts. As of August 25, 2011, the export tax on unprocessed cashew nuts will be lowered from 5 percent to 3 percent.

However, Vinacas predicts that in the remaining months, cashew exports may run into difficulty, if the circular 13/2011/TT-BNNPTNN is not modified.

Under circular 13, as of July 1, imported food must be inspected even from countries that meet the hygienic requirements of the Vietnamese authorized agency. Critics said this mechanism hindered the process and deterred exporters.

To solve the problem, deputy minister of Ministry of Agriculture and Rural Development Bui Ba Bong said Vinacas would petition MARD not to apply circular 13 to the cashew industry.

Bong said the industry was seeking ways to raise income for cashew farmers, in order to encourage domestic productivity. One of the most effective methods was to grow cacao trees alternately with cashew trees.

The industry plans to develop intensive cashew growing areas with at least 200,000 ha in Binh Phuoc and Dong Nai provinces, hoping that productivity will increase to 1.5 tons per ha.

The association petitioned the Government and the State Bank of Vietnam to provide them preferential loans to buy raw cashew at home and abroad.

Part of their export consignments go missing from containers by the time they reach importers, many cashew exporters complained at a meeting held in HCM City Aug. 10 and sought assistance from the Ministry of Public Security.

Long Son, Tan Hoa, Huynh Minh, and Donafoods Co, Ltd and several other companies reported such losses in transit.

Tong Dai Phong, head of the planning and marketing department of Donafoods, said his company lost 538 boxes worth US$102,000 earlier this month.

Source: Vietnamplus

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