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  • Cashew sector in the throes of another setback

    May 15th, 2020

    With main competitor Vietnam expanding its exports to more countries during lockdown and the domestic market at a standstill, the cashew sector is facing yet another setback. Since the industry was hardly able to ship any major consignment during the last two months, exporters are also worried about a possible piling up of merchandise. “While India could not deliver during the lockdown, Vietnam was operating in full swing and they were able to fulfil the overseas orders. While our contracts got cancelled, Vietnam stepped into that vacuum, banking on demand. The biggest blow was losing the Middle East market which was loyal to Indian cashew and they have almost captured U.S., another major market. We fear that they will continue with Vietnam even after we are back,” says R.K. Bhoodesh, former chairman of Cashew Export Promotion Council of India (CEPCI). Huge challenge While recapturing the international kernel market poses a huge challenge, domestic market also witnessed a substantial fall in sales during the pandemic. The ailing industry was gearing up for a revival with Kerala State Cashew Development Corporation (KSCDC) registering record sales during last Onam. Since India is the biggest consumer of cashew, aggressive marketing strategies are being planned to tap into the domestic market. “But now domestic market also holds no promises, at least for some months. Our major markets were metros like Delhi and Mumabi that were badly hit by COVID-19. It will take minimum six months for the situation to change, but even that chance will be lost if there is a spike in corona cases,” says S. Anilkumar, managing director, Kerala State Cashew Workers Apex Industrial Cooperative Society (Capex). Productivity All the factories, including those in public sector, are now operating with 50% workforce, which amounts to a sharp dip in total productivity. The sector also incurred a loss of around ₹4,500 crore during the lockdown as processing units across the country were holding huge stocks of exposed kernels in different stages of processing. “Since Vietnam has mechanised processing, they can sell the product at a much lower price. At the same time Indian cashew has more quality and longer shelf life, which is a positive factor. Good quality wholes are always exported and it’s mainly splits and broken kernels that reach the domestic market. Since we have many export-oriented units, recapturing the lost markets will be crucial for the sector’s survival,” says K. Rajesh, president, Cashew Industry Protection Council.