iGrain India - Mangalore (NS:MRPL). Due to dry and hot weather and irregular rainfall in African countries, the production of raw cashew nuts has been affected, due to which not only its exportable stock has decreased there but prices have also increased.
The strong purchases by countries like India and Vietnam are also supporting the price of raw cashew nuts in Africa. Due to the high cost of raw material, the cost of the finished product has increased, so it seems difficult for the price of processed cashew nuts to come down in the near future.
The festive season is going to start in the country from August, so Disawari traders have already started buying cashew nuts and making their stock. This also includes sweets manufacturing firms.
According to trade analysts, if the price of raw cashew nuts improves by Rs 25/30 in the coming months, then the price of processed cashew nuts can increase by up to Rs 150/200 per kg. There is a shortage of raw cashew in the domestic sector and processing (roller plants) are not getting sufficient stock of it at a reasonable price.
Africa's share in the global export of raw cashew is 50-60 percent while Vietnam and India are its two major buyers.
The price of raw cashew in the producing countries has increased by 25-30 percent this time as compared to last year. In India and Vietnam too, the weather has not been favorable for cashew crop for the last several months, so there are signs of production being affected.
According to industry analysts, due to shortage of raw material, processing plants are able to use only 50 percent of their total accumulated capacity.
Many processing units have also been established in Africa, due to which the demand and consumption of raw cashew has started increasing there. It seems that this time the domestic market price of cashew may remain a bit high during the festive season.