India: Cashew industry in a tight corner

The weakening rupee and short supply from major cashew-growing countries in Africa have pushed up the prices of the raw nuts imported by the Indian cashew-processing industry, sources in the Cashew Export Promotion Council of India here say.

The industry imported raw nuts at Rs.48 a kg in February, when 50,000 tonnes were so brought in, as against Rs.28 a kg between April 2007 and February 2008, sources say.

The unit value realisation for the kernels dropped in the international markets after shooting up to around Rs.380 a kg in mid-2008, in the wake of the ongoing economic recession, which started having an impact from September 2008.

The exports dropped during the current financial year, sources say.

Exports during April-February stood at 99,348 tonnes, valued at Rs.2,719,79 crore ($597.62 million), as against 1,03,139 tonnes, valued at Rs.2,033.18 crore ($505.14 million), in the corresponding period a year ago.

The average unit value realisation during the current fiscal has been Rs.273.76 a kg from the Rs.197.13 a year ago.

Shipments of cashew kernels in February 2009 were 7,968 tonnes from the 8,350 tonnes the corresponding month a year ago, a 4.2 per cent drop.

The unit value realisation dropped from Rs.297 a kg during the last quarter of 2008 to Rs.267 a kg in February this year.

Exports of cashew kernels have become unattractive as the cost of imported raw nuts has gone up. This has also raised the unit value realisation on exports.

Availability of indigenous raw nuts has been stagnant at around six lakh tonnes as against the 12 lakh tonnes the industry requires. The price of raw nuts in the country has gone up to Rs.50-52 a kg and even more in some areas.

The industry has been dependent on imports and unless sustained efforts are made to promote cultivation in wider areas, the prospects of the traditional industry of the State, which employs a large number of skilled workers, will continue to be in the doldrums, sources add.


Source: hindu.com

Publication date: 3/23/2009