Cashew Market Report – Dec 22, 2012

DEC 22, 2012

There was very limited activity in the Cashew Market in Weeks 50 & 51 with stray sales to USA & EU. Other markets were also quiet.  Indian domestic market saw some enquiries but not much business was done.  China is reported to be buying selectively in Vietnam but volumes are small.

Range of prices this week has been  W240 from 3.70 to 3.85, W320 from 3.30 to 3.45,  W450 from 3.05 to 3.15,  SW from 2.60 to 3.10,  SSW from 2.40 to 2.50, Splits from 2.05 to 2.20, Pieces from 1.45 to 1.70 FOB.RCN market was steady. Prices range from US$ 850 to US$ 1350 depending on origin and quality.  There was reasonable movement of West African stocks in India & Vietnam plus some new shipments from origin.  There was brisk buying in the Tanzania auctions – over 40,000mt have been traded in less than a month.  Small quantities of Mozambique RCN have also been traded this week.  Brazil crop will be much smaller than the last 2 years which were already significantly lower than last few years average.  Does this mean a permanent change in normal crop size or is it a unfortunate series of weather affected crops ?

Despite almost one month of very limited activity, there has not been much change in kernel  prices.  Some processors did offer last week at the lower end of the range and the offers were quickly picked up. But, in general,  most processors are reluctant to sell at lower levels  – they probably expect demand to pick up after the holidays.

During the burst of activity in Oct/Nov, most buyers covered a portion of their early 2013 needs but we feel  that there is still a fair amount of buying to be done for shipments in Jan-Apr.  If  Oct-Dec offtake is  normal, inventories at end of the year will be low and replenishment demand will add to the volume to be bought.  So we would expect market to be steady or move up a bit in January.

If there is no change in RCN prices from current levels during the 2013 Northern harvest, we will have average RCN price of US$ 1000 which equates approx US$ 2.35 per lb of kernels (basis W320).   Add a processing cost of minimum US$ 1.25 per lb of kernels.   If kernel prices do not move up a notch from the current range of 3.30 to 3.50,  RCN price will have to come down significantly.  Or there has to be an  improvement in demand and prices of lower grades which have been very difficult to sell for the last few months.

Would appreciate your comments on the market situation,  views and forecast of upcoming demand + market trend,   any information or news…   and your interest
Pankaj N. Sampat
Please see CONTACTS page for full contact details

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