Cashew kernel prices to rise 10% on festive demand

Cashew kernel prices are set to increase 10 per cent in the wholesale markets, as the festival demand for the nut is increasing. This will be the second increase in the past month. Traders are also trying to cover their cost of imports and processing, as rupee depreciation has put pressure on both. The prices are currently at Rs 550 a kg, while the broken nuts are sold in the range of Rs 350-400 a kg in major wholesale markets.

Prices were Rs 445 a kg in March this year and had seen downward movement due to subdued demand from stockists and retailers. However, the rupee depreciation in the recent past has impacted the prices, as the cashew processing industry imports more than half of its annual raw nut requirement of 700,000-800,000 tonnes.

Currently, cashew kernels are traded at Rs 550-600 a kg, depending on the grades in wholesale markets across the country, showing an increase of 23 per cent compared to Rs 445 a kg in March this year. Just a month ago, the prices were ruling at Rs 525 a kg. The broken grades of cashew kernels are traded at Rs 350-400 a kg, against Rs 280 a kg in March, showing an increase of 42 per cent.

"The availability of large wholes is tight and demand for good quality brokens is good. Prices have gone up by 10 per cent in the past month and another 10 per cent rise is possible in the next one month as the festival season has begun. A weaker rupee has also made imported nuts expensive," said Pankaj Sampath of Samsons Traders, a Mumbai-based commodity brokerage house. Besides cashew kernels, prices of other major imported nuts like almond and pistachios have increased in the past month. Currently, almond prices are quoted at Rs 590 a kg. Pistachios are traded at Rs 1,250-1,300 a kg.

"Almond prices have been rising this year and they are set to hit an all-time high of over Rs 600 a kg this year. Though the wedding season is almost over for this year, the shravana (Saavan) month has just begun and by the Ganesh festival, another Rs 20-30 a kg increase is possible," Rahul Kamath, Partner, Bola Surendra Kamath & Sons, a Mangalore-based trader of dry fruits said.

India's domestic consumption of cashew kernels has been rising over the past few years and this year it is likely to be 190,000 tonnes. India exports 115,000 tonnes of cashew kernels. The domestic cashew processing industry requires 1.4 million tonnes of raw cashew nuts, whereas the domestic production is almost stagnant at 700,000 tonnes annually.