Cashew Kernel Exports Dip 21%On Shortage Of Raw Cashew Nuts

After seeing a record rise in exports last year, India's cashew kernel exports have seen a declining trend in the first two months of the current fiscal as the processing industry witnessed shortage of raw cashew nuts. The decline in production in both India and African countries caused shortfall in raw cashew nuts.

The exports of kernels stood at 15,715 metric tonnes between April and May 2014 as against 19,904 metric tonnes in the corresponding period last year, showing a decline of 21%.

"The availability of raw cashew nuts was lower during the fourth quarter of last fiscal, which is processed and exported in the months of April and May. Though the processors imported higher quantity in the first two months, they faced shortage in the preceding months. In addition, the prices of raw nuts went up significantly adding to the cost of processors," said Rahul Kamath, partner at Mangalore-based Bola Surendra Kamath and Sons.

He said the new crop came only in April and due to short crop this year the prices of raw cashew nuts went up over 50 per cent to Rs 100 per kg. Even imported nuts from Tanzania were priced at Rs 94 per kg, which added to the cost of processing industry. Many processing units have either worked half of their capacity or shut down during the first two months of this fiscal, he said.

In value terms, the exporters earned Rs 683.39 crore, a decline of 10.3% over the corresponding period. In April and May last year, the earnings were Rs 761.96 crore. In dollar terms, the earnings were $114.20 million, a decline of 18% over the last year's earnings of $139.30 million. The average unit value realisation was however higher at Rs 434.85 per kg as against Rs 382.82 per kg in the same period last year.

"During the beginning of this fiscal, the raw cashew nuts were not freely available for exporters even though the rupee was steady against the dollar. There were some issues in Tuticorin port, which resulted in huge pile up of trucks and caused delay in export of nuts. Moreover, the domestic prices were encouraging and the processors were happy selling locally," said Sasi Varma, executive director, Cashew Export Promotion Council of India (CEPCI).

Exports in the month of May were higher compared to April. In May exports stood at 8,397 metric tonnes as against 7,318 in April. "There was a slight drop in demand at the beginning of the fiscal at consuming countries. It is picking up now and we expect the exports to pick up steam in the coming months. The buyers adopted a wait and watch policy in the first two months. In addition, the availability of raw cashew nuts was the main reason for decline in exports," said Pankaj Sampath of Mumbai-based Samsons Traders said.

He said there has been a renewed demand for broken grades from the buyers in EU and US once again over the last six months, which had dried up last year.For the year 2013-14, India exported a record 1,13,260 metric tonnes valued at Rs 4,976 crore, an all-time high.

Source : business-standard.com