The market of cashews remains a bit of a rollercoaster.The one day sellers are discounting their kernel prices as they have no demand and buyers are gone while the next day, some demand shows up for limited quantities and prices immediately increase a couple of cents again.
Raw Cashew Nut (RCN) demand is almost as volatile, whereas there is a lot of rumours that impact the sentiment in the market.
The facts (and rumours) at the moment are as follows:
1.The crops in West Africa are reported be good with the biggest producer Ivory coast reporting a crop over 800.000 mton of raw seeds – rumour.Fact may be that the crop comes in somewhat lower on volume and quality due to rain damage.
2.The crop in Guinea Bissau is 3-4 weeks earlier so shipments from this producing origin are expected to start during April/May – fact. Demand is high and price may hit all-time highs.
3.Prices of raw seeds have eased a bit in various origins in Africa and are now stable – fact.
4. The Vietnamese and Cambodian crops are questionable on volume and quality. They are definitely less in volume compared to last year and quality is reason for concern in some areas – fact. This is having a negative impact on the supply for very short term, supply of RCN to the processors will only reach some sort of saturation point when the shipments from West Africa will come in in significant quantities – fact.
5. The prices of kernels are moving on demand at the moment as written above – fact.
6. Most buyers are covered until May and will be in the market with new inquiries for June 2017 onwards – fact or rumour ?
7.Most buyer are expecting prices to ease from June/July onwards – fact….but will this happen ?
Keeping all the facts in mind, our expectation is that prices will remain firm probably slightly longer than earlier anticipated because of the crop issues in Vietnam/Cambodia but that generally prices will come down during the 2nd half of 2017 when enough raw seeds from West Africa (approx. 40% of total world production) will arrive in India and Vietnam. We do not expect prices to fall below Usd 4 per lbs (for WW320) again but will be between Usd 4,15-4,50 per lbs (for WW320). Our recommendation therefore is to be covered until July/August and be patient a bit for later shipment positions.