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  • Cashew prices to rebound in 2021 after hitting rock bottom this year 01/06/2021

    Jan 6th, 2021

    Supply crunch may cause global cashew prices to remain steady or firm up slightly till March. “The off-take in November – December will determine the trend of kernel activity in January/February. Kernel prices will impact the raw cashew nut (RCN) demand and prices when it is harvested later during the year,” said Pankaj N Sampat of Samson Traders. “RCN prices ($1,400-$1,500 per tonne) are slightly higher than lows reached in April/May. They may come down during the peak of 2021 harvest (provided all crops are good). But it is unlikely that they will come down to the 2020 lows,” he said. “Overall, we expect that the market will be steady for first half of 2021 with the possibility of some increase if the kernel market is active in Jan/Feb. It is unlikely that in the near future, we will again see the very low prices that witnessed in Q2 of 2020,” he said. After registering a 50 per cent drop in April/May, RCN prices recovered by 30-35 per cent in the last few months. Covid and its impact on economies everywhere hit RCN movement and processing in India. Cashew consumption fell in India during Q2 and Q3 because of lockdown and restrictions on the hotel, restaurant and catering segment. However, he expects the cashew sales to increase in 2021. In all other markets, there has been a reasonable growth in consumption during 2020. This can be expected to continue in 2021 due to the lower prices, consistent supply and the general popularity of natural and healthy foods. Current kernel prices are the lowest in 10-11 years in Vietnam and 5-6 years in India, and current RCN prices are the lowest in 4-5 years. For most of 2020, cashew kernel prices have been moving sideways – except for the big drop in March/April and short-lived dip in Aug/Sept. The main traded grade – W320 has been in the range of $2.80-3.10 FOB Vietnam and $3.30-3.60 FOB India for most of the second half of 2020. However, slow movement of broken grades has been a challenge for all origins – aggravated by the decline in consumption of these grades in the catering and traditional sweets segment in India. During the recent Tanzania auctions, prices have been surprisingly steady despite not much activity in the kernel market, he pointed out.