The cashew crop is grown in 300,000 ha in Vietnam, with an average productivity of 1,000 kg/ha. The major cashew nut producing areas in Vietnam are Dak Nong, Dak Lak, Binh Duong, Binh Phuoc, Tay Ninh, Long An, Kien Giang, Kon Tum, Gia Lai, Quang Nam, Quang Ngai, Binh Dinh, Phu Yen, Khanh Hoa, Ninh Thuan, Lam Dong, Binh Thuan and Dong Nai. Binh Phuoc accounts for half of the cashew production in the country. The country has also evolved as the second largest cashew processor in the region as well as globally, with an annual capacity of 1.2 million metric tons.

Due to an ongoing supply crunch caused by the lower production in Vietnam and Western African markets, the global cashew prices are expected to continue to escalate in the near future. Shippers of RCN have negotiated new prices with sellers in Vietnam. Vietnam is currently focusing on increasing its productivity from 1,700 kg to 2,000 kg per ha, as disposed land for cashew production is limited in the country.

Việt Nam exported 39,200 tonnes of cashew nuts in June, earning US$275.6 million, according to the General Department of Customs, up 21.4 per cent in volume but down 6 per cent in value year on year.

In the first six months of this year, cashew nut exports reached 195,700 tonnes, worth about $1.5 billion, up 12.2 per cent in volume, but down 12.1 per cent in value year on year.

The reduction in value was due to a plunge in the export price of cashew nuts in the first six months of the year. The average price dropped by 21.5 per cent year on year to $7,613 per tonne.

Now, the three largest cashew export markets of Vietnamese cashew nuts are the US, China and the Netherlands, accounting for 32.3 per cent, 14.1 per cent and 9.5 per cent of the total export value, respectively.

The General Department of Customs said cashew nut exports to the US in the first six months of the year reached 63,700 tonnes, worth $480.7 million. Those figures fell 4 per cent in volume and 25.7 per cent in value compared to the same period of 2018.

Meanwhile, during the first six months, Việt Nam gained strong growth in cashew nut exports to China, the second largest export market of local cashew nut, at 53.2 per cent to 28,200 tonnes year on year. The export value of cashew nuts rose 24.8 per cent year on year to $221.5 million.

In June, exports of cashew nuts to China increased by 143.8 per cent in volume to 6,600 tonnes and 104.2 per cent in value to $51 million compared with June 2018.

Tạ Quang Huyên, General Director of Hoàng Sơn 1 Company, said walnuts and almonds, the two main competitors of cashew nuts in China, have faced high tariffs so are very expensive. This has pushed cashew nut consumption up sharply. It is expected China will buy a huge volume of cashew nuts from Việt Nam this year.

He also said Việt Nam’s total export volume of cashew nuts this year end would surge strongly because of the world’s high demand for cashew nuts for holidays.

The EU-Vietnam Free Trade Agreement (EVFTA), signed in Hanoi on June 30, is expected to help boost Vietnam’s cashew nut exports.

According to the General Department of Vietnam Customs, the country exported 174,700 tonnes of cashew nuts worth some 1.34 billion USD from the beginning of this year till mid-June, up 9.6 percent in volume but down 13.6 percent in value year on year.

Cashew nuts were sold for 7,689 USD per tonne, a drop of 21.3 percent against the same period last year.

Tran Trong Khoi, Deputy General Director of Ha My JSC in the southern province of Binh Phuoc, explained that Vietnam had to import cashew nuts from Africa with lower quality for exports.

The Export-Import Department under the Ministry of Industry and Trade forecast that the global cashew nut price will recover in the coming months thanks to increasing demand during Thanksgiving and Christmas holidays. 

Khoi said the EVFTA will offer huge opportunities to businesses, suggesting they should pay special attention to product quality as well as food safety and hygiene.

The Department of Industry and Trade of Binh Phuoc province – the country’s largest cashew producer and exporter – said the EU, especially Germany and the Netherlands, remain Vietnam’s most important markets.

Binh Phuoc aims to encourage enterprises to optimise opportunities generated by the EVFTA and study requirements of importers.

Local officials had a working session with representatives of the Ivory Coast – the world’s leading cashew producer with total area amounting to 1.4 million hectares and average productivity reaching about 5 tonnes per ha.

The country, which has only 8 percent of cashew nuts undergoing intensive processing before being delivered abroad, wishes to work with Binh Phuoc firms in cashew nut processing.

MCE Group from the Netherlands planned to invest US$250 million in Bình Phước Province’s cashew industry, online newspaper vietnamplus.vn reported.

The Dutch enterprise plans to build a cashew nut shell oil factory which will cover 10ha in Đức Liễu Commune, Bù Đăng District. It will also develop a 190ha organic cashew plantation in the same commune in order to provide clean and quality cashew products for export.

Additionally, the company will support Bình Phước in developing a 5,000ha area to supply raw materials for cashew processing that meet the strict standards of European markets in the communes of Đức Liễu and Thống Nhất.

Vice chairwoman of the provincial People’s Committee Huỳnh Thị Hằng spoke highly of the Dutch business’ plan, requesting departments and sectors to closely work with the company to develop a brand for the province’s cashew products.

The province is home to more than 71,600 households growing cashews on nearly 174,020ha, accounting for 30 per cent of total agricultural land.

The trees are grown mainly across the districts of Bù Đăng, Phú Riềng, Bù Gia Mập and Đông Phú, yielding about 200,000 tonnes per year.

There are about 200 cashew companies and 400 cashew processing facilities in Bình Phước, with an annual combined capacity of 500,000 tonnes.

Cashew prices are expected to recover this year on the global market and producers should promote cooperation to remain stable.

R K Dhoodes, chairman of the Cashew Export Promotion Council of India (CEPC) said annual consumption of cashew nuts has increased sharply, meaning good news for the global cashew industry. He predicted demand will continue to rise so prices will also surge.

The CEPC chairman said in the future there should be a common institution for controlling trade activities to ensure parties respect contracts. Prices must be fair to ensure all parties benefit in the value chain.

During the conference, the Việt Nam Cashew Association (Vinacas) and the CEPC held talks about promoting cooperation in stabilising cashew prices this year.

The cooperation between Vinacas and CEPC, representatives of the two largest cashew processing countries in the world – India and Việt Nam, is necessary to gradually stabilise the market and ensure benefits in the global value chain this year and beyond.

Also at the conference, participants asked African countries to control the quality of exported cashews this year.

The conference forecasted that global raw cashew output this year is about 4 million tonnes (or 1 million tonnes of processed cashew), including over 2 million tonnes in Africa and the remainder from other countries including India, Việt Nam, Indonesia and Cambodia.

The conference this year attracted 300 businesses from Việt Nam and other countries. The annual event was under the national trade promotion programme and showed achievements and innovations in food safety and hygiene technology of Việt Nam’s cashew industry.

Source: Vitic