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  • Processing things: much to import raw materials

    Dec 7th, 2018

    In the past 11 months, cashew exports have reached $ 3.1 billion but have to spend $ 2.25 billion to import raw materials. The United States, the Netherlands and China are still the three largest cashew markets in Vietnam.

    The cashew nut industry in Vietnam has spent $ 2.25 billion to import raw cashew nuts in the past 11 months. Tanzania stops exporting raw cashew nuts, while African cashew growers plan to invest in deep processing, which will make it difficult for Vietnam to buy raw materials in the coming years.

    According to the Ministry of Agriculture and Rural Development, in November of 1818, cashew nut Vietnam exported 37,000 tons, earned $ 291 million. The export turnover of the first eleven months was 342,000 tons, valued at US $ 3.1 billion, up 5.9% in volume and down 3.1% in value over the same period of 2017. Accumulated from the beginning of the year to the end In November, the average export price of cashew nuts was about $ 9,297 a ton, down 5% over the same period last year.

     Hard to input and output

    The United States, the Netherlands and China are still the three largest cashew markets in Vietnam. This year, exports to China are in danger of being shrunk. Due to the trade war with the US, China restricted Vietnamese exporters from exporting to China by small quota. This is a measure to prevent US goods and countries from entering China through the small.

    According to the Vietnam Association of Seafood Exporters and Producers (VINACAS), the unofficial route seems to be shrinking as the Chinese side adopts the official LC payment method for imported cashew. If payment by LC is applied, cashew will not be transported much through the border gate in Lang Son, Cao Bang, Lao Cai, mainly by container.

    Although the intention was not formally announced yet, Chinese importers had informed the Vietnamese counterparts that the Chinese side would sooner or later apply the regulations on food safety and hygiene at Vietnamese cashew factories. South exports to China.

    Exporting cashew nuts brings in large foreign currency, but cashew processing industry also has to spend more than 2/3 of this foreign currency to import raw cashew. The volume of imported raw materials in November 2018 was 82,000 tons, costing $ 127 million, bringing the total volume and value of imported raw materials in 11 months to 1.14 million tons and the value reached $ 2.25 billion .

    Thus, the cashew industry to this time reached a surplus of $ 850 million, most of which is the added value of cashew processing enterprises, while sales of cashew products in the country only reached about $ 200-250 million . Cashew processing industry in Vietnam is increasingly reliant on imported raw materials, while the price of raw materials is increasing, supply in the world is increasingly scarce, the quality is also very uncertain.

    Tanzania's purchase of all the raw water in the country leaves the risk of losing one of its major sources of raw cashew. According to experts, many African countries are promoting cashew nut processing instead of raw cashew exports, with the expectation that value-added products will have a significant impact on poverty reduction.

    Domestic output only meets 30%

    Vietnam has exported processed kernel to over 90 markets and territories and is the largest exporter of cashew nuts in the world, reaching USD 3.6 billion in 2017. Vietnam has more than 465 processing enterprises cashewnut, with annual cashew nut about 1.5 million tons, so the domestic supply of raw materials is only more than 30%. In this context, Vietnam needs to increase domestic cashew production to reduce imports of raw materials.

    According to the Department of Crop Production, cashewnut area of ​​Vietnam has decreased continuously in the past 8 years, from nearly 440,000 hectares to 297,498 hectares. Of which, the South East is the largest cashew production area, with 183,700 hectares, yielding 140,600 tonnes, accounting for 61.6% of the total area and 66.6% of the total cashew production.

    Next to the Central Highlands and the Central Coast. Binh Phuoc province has the largest cashew area in the country, but yields fall sharply, reaching an average of 0.715 tonnes / ha in 2017/2018. In the period of 2008 - 2017, cashew yield of Vietnam is always low, just under 1 ton / ha. National cashew production reached 352,000 tons in 2016/2017. But by 2017/2018 due to reduced yields, crude output was down to just 210,899 tonnes.

    The biggest problem of the cashew industry is that most cashewnut areas are distributed in remote areas. Not interested in intensive investment. Especially watering, pest management, fertilizing; Production and processing links are limited. Due to low cashew yield, it is not economically viable and competitive with other crops. Breeding selection has not been properly considered.

    Since 1999 up to now, only 13 varieties have been selected and recognized for trial production, there is no officially recognized seed for production. Cashew trees are not high income and are often affected by diseases and weather.

    As a result, the Ministry of Agriculture and Rural Development (MARD) has decided not to increase the area by 2030, but to focus on technical aspects to increase yield and cashew yield. At the same time, focusing on restructuring the cashew industry, businesses also need to restructure and focus on deep processing, intensive farming process, modeling and stabilizing output. Cultivation Department said that cashew yield can be increased 30-40%, if the synchronous application of scientific advances in cultivation.


    Source: http://www.vinacas.com.vn/