Cashew exports may jump 50% in FYO9

In 2007-08, India exported 114,340 tonnes of cashew valued at Rs 2,289 crore, a drop of 3.5 per cent in volume and 6.7 per cent in value terms compared to the previous year.

However, the country may not see a big jump in exports in volume as there will be a shortfall in the domestic production of raw nuts, said Bharatan Pillai, chairman, Cashew Export Promotion Council of India (CEPCI).

"As a result of the rise in global prices, we expect Indian exporters to earn as much as 50-60 per cent more in the unit value realisation this year," he said.

The current rise in prices is attributed to a combination of factors, mainly failure of Vietnam, a major competitor, to meet its export commitments to the US, Europe, Australia and Japan. There has been a spurt in domestic consumption driven by the retail boom.

It is estimated that Vietnam has defaulted in supply of large-scale consignments to its customers, resulting in depletion of inventories of the buyers.

Vietnam's failure has opened up a huge opportunity for India as buyers in Europe and US have returned to buy the commodity from their long-standing and reliable supplier.

"On the one hand, Indian exporters are happy there is a chance for them to regain their market share in the international market, but, on the other hand, there is going to be some supply constraints as domestic production is likely to be lower this year," Walter D'Souza, former chairman, CEPCI said.

Due to unseasonal rains in major growing areas of the West coast, including Karnataka and Kerala, in March, the domestic raw cashewnut production is likely to drop by 20 per cent this year. In Kerala alone, the rawnut production is likely to come down by nearly 30 per cent to 40 per cent, Pillai said.

Normally, March is the period for flowering of cashew. Rains at this time will not only reduce the yield but also affect the quality of the remaining nuts, D'Souza said, adding that the loss could be in the range of 90,000 tonnes to 100,000 tonnes.

India produces around 600,000 tonnes annually and imports an equal amount to meet the demand of domestic cashew processors.