Cashew Price Soars Amid Overseas Interests

The average price of unprocessed cashews in Cambodia during the first six months of the year was over 50 percent higher than during the same period in 2014 due to increased interest from overseas buyers and reduced regional supply, according to industry experts. Chhiv Ngy, president of the Cashew Association of Kompong Thom, said the average price of unprocessed cashews was 4,550 riel (about $1.14) per kilogram between January 1 and the end of June, up from 3,000 riel (about $0.75) during the same period last year.

Mr. Ngy said that since December, increased interest in unprocessed cashews from South Korea, Japan, Canada and Germany had given local farmers more power in negotiating prices with middlemen. “This year, middlemen cannot lower the price when they buy cashews from farmers, which is different from last year,” said Mr. Ngy, whose association comprises 378 member families cultivating 10,000 hectares of land.

Tep Sothun, director of cashew exporter Mekong Rain Natural Foods, said that an overall lower supply of cashews in the region had led more international buyers to turn to Cambodia for the nut, thereby enabling local farmers to fetch higher prices.

“In Asia, countries that used to produce the most cashews…include India, Indonesia and Vietnam,” he said. “After the price of rubber soared earlier, farmers in those countries mostly cut down their cashew trees and grew rubber trees instead.” As the price of rubber dropped, Mr. Sothun said, the price of cashews rose due to high demand.

“That’s why this year, Vietnamese traders and other cashew businesspeople from other countries flocked to Cambodia to find cashews, resulting in a very high price,” he said. Chhean Vongchhay, a cashew trader in Ratanakkiri province’s Banlung City, said that while cashews in his province were less popular due to their smaller-than-average size, demand had also risen in the area. “There are more middlemen in the city competing…to buy cashews from local farmers to sell to Vietnamese traders at Cambodia-Vietnam border areas like Keo Seima and O’Yadaw,” he said.

Economist Srey Chanthy said the higher prices had led many Cambodian farmers to abandon rubber in favor of cashews. “It [Cambodia’s supply of cashews] has been increasing very significantly over the past five years,” he said, noting the country still played a minor role in the nut’s global supply.

Source:https://www.cambodiadaily.com

Downward Spiral in Raw Cashew Market

There is a steep decline in raw cashew prices across South India. The downward trend is mainly because of huge imports from West Africa. The quality of imports is said to be satisfactory when compared with past few years. However the present quality is not as good as last year’s imports. Another reason for the fall is increase in the cost of production.

Many factories are for sale in Maharashtra and Kerala.

Domestic raw cashew prices were too high in Maharashtra during the procurement season and there was high dependence on Mumbai and adjoining kernel markets. Therefore the local processors should target corporate retailers and export market else they might face shutdown.

Source: http://worldcashew.com/

Vietnam cashew industry: Time for a new strategy

Spurred by the recent detection of salmonella by the US FDA (Food and Drug Administration) in routine sampling of cashews, Nguyen Duc Thanh said it is imperative for the industry to take a remedial and fresh approach to the problem. The President of the Vietnam Cashew Association (Vinacas) also unveiled the FDA issued a food poisoning bulletin and ordered a recall of 14,000 pounds of Vietnamese LP Cashews due to the discovery of Salmonella. In addition the FDA is undertaking a thorough investigation to ferret out the specific details surrounding the matter.

Salmonella can lead to a variety of gastric upsets and be particularly devastating (even deadly) to the very young, elderly and those with compromised immune systems. Salmonella cannot be seen or detected by sight or smell. The packer was Hong Duc Company Limited located at 40/8 Chua Hoi Khanh St., Phu Cuong Ward, Thu Dau Mot Township, Binh Duong. The company has ceased distribution of the product as the FDA investigation continues. No illnesses have been reported to date. The cashews in question were distributed by The Hemisphere Group of New York to direct customers in the states of Michigan, Massachusetts and New York in the US plus the municipalities of Quebec and Scarborough in Canada. All direct customers have been instructed to notify their accounts and return the cashews to The Hemisphere Group for a full refund, which in turn will presumably be passes on to Hong Duc Company Limited.

Concerns about food safety and hygiene In addition, Thanh revealed in the six months leading up to July of 2015, Vietnamese exporters shipped 150,000 tons of cashews generating US$1.1 billion of revenue to overseas markets. For calendar year 2014, the total revenue for cashew and related by product exports had been forecast at US$2.5 billion but all that could be jeopardized by the legitimate concerns of foreign consumers over food safety and hygiene. Losses will continue to mount until the nation puts strong measures in place to ensure food safety, said Thanh. We could see total potential economic losses of a billion US dollars, in just the cashew industry alone until that occurs. The discovery of salmonella is just the latest scare to batter the Vietnam agricultural and aquatic industries. Sickness caused by contaminated fish and seafood have eroded public confidence in Vietnam’s food safety and renewed calls for change by both the Vietnam government and the FDA.

"These events are causing steep declines in consumer confidence both domestically and abroad in the overall safety of foodstuffs and the government’s ability to protect the public," said Thanh. "It is clear that we cannot rely on the government alone to prevent food borne illness outbreaks," said Thanh. "Food processors must implement preventative systems to stop outbreaks before they occur, and we need to hold them accountable when they fail." Another limitation for Vietnamese companies in the cashew industry is that they lower prices to compete against other companies and to compensate, in turn then lower the quality of their products. In other words, open markets are new to the majority of Vietnamese and they have not mastered the techniques of managing business yet— and don’t really have a solid grasp of fundamentally sound business practices. “In Brazil and India, businesses keep both their prices and quality of products high,” Thanh said.

Thanh added that these practices ensure not only food safety and hygiene, but maintain the individual company’s image as well as serve to elevate Brazil and India’s prestige in the global marketplace. To add insult to injury, today an excessive number of domestic businesses are getting into the cashew export business resulting in competition that is becoming overly cutthroat and unhealthy. In 2014, there were roughly 345 companies in the industry and 73% of them had sales of less than US$5 million per year, Thanh said adding that this resulted in poor and uneven quality, causing unnecessary losses for the entire industry.

“This has created an untenable situation for the cashew industry in long-term,” Thanh stressed. Last year, out of 265 companies, 119 (or 49%) of them were ranked substandard in class C. The authorities penalized businesses in class C (for failure to meet the minimum standards of food safety hygiene) in order to maintain fairness in production.   The nation simply lacks too many of the critical components that contribute to the safe, quality-oriented food manufacturing and processing environments that exist in Western economies. Vietnam is further challenged by weak government capacity at the local levels. Despite these challenges, if the cashew industry is to expand and maintain sustainable international trade then it’s high time for a new strategy and progressive safety regimes to be put in place for the cashew industry, Thanh concluded.

Source: Spurred by the recent detection of salmonella by the US FDA (Food and Drug Administration) in routine sampling of cashews, Nguyen Duc Thanh said it is imperative for the industry to take a remedial and fresh approach to the problem. The President of the Vietnam Cashew Association (Vinacas) also unveiled the FDA issued a food poisoning bulletin and ordered a recall of 14,000 pounds of Vietnamese LP Cashews due to the discovery of Salmonella. In addition the FDA is undertaking a thorough investigation to ferret out the specific details surrounding the matter. Salmonella can lead to a variety of gastric upsets and be particularly devastating (even deadly) to the very young, elderly and those with compromised immune systems. Salmonella cannot be seen or detected by sight or smell.

The packer was Hong Duc Company Limited located at 40/8 Chua Hoi Khanh St., Phu Cuong Ward, Thu Dau Mot Township, Binh Duong. The company has ceased distribution of the product as the FDA investigation continues. No illnesses have been reported to date.  The cashews in question were distributed by The Hemisphere Group of New York to direct customers in the states of Michigan, Massachusetts and New York in the US plus the municipalities of Quebec and Scarborough in Canada. All direct customers have been instructed to notify their accounts and return the cashews to The Hemisphere Group for a full refund, which in turn will presumably be passes on to Hong Duc Company Limited.

Concerns about food safety and hygiene

In addition, Thanh revealed in the six months leading up to July of 2015, Vietnamese exporters shipped 150,000 tons of cashews generating US$1.1 billion of revenue to overseas markets. For calendar year 2014, the total revenue for cashew and related by product exports had been forecast at US$2.5 billion but all that could be jeopardized by the legitimate concerns of foreign consumers over food safety and hygiene. Losses will continue to mount until the nation puts strong measures in place to ensure food safety, said Thanh. We could see total potential economic losses of a billion US dollars, in just the cashew industry alone until that occurs.

The discovery of salmonella is just the latest scare to batter the Vietnam agricultural and aquatic industries. Sickness caused by contaminated fish and seafood have eroded public confidence in Vietnam’s food safety and renewed calls for change by both the Vietnam government and the FDA. "These events are causing steep declines in consumer confidence both domestically and abroad in the overall safety of foodstuffs and the government’s ability to protect the public," said Thanh. "It is clear that we cannot rely on the government alone to prevent food borne illness outbreaks," said Thanh. "Food processors must implement preventative systems to stop outbreaks before they occur, and we need to hold them accountable when they fail."

Another limitation for Vietnamese companies in the cashew industry is that they lower prices to compete against other companies and to compensate, in turn then lower the quality of their products. In other words, open markets are new to the majority of Vietnamese and they have not mastered the techniques of managing business yet— and don’t really have a solid grasp of fundamentally sound business practices. “In Brazil and India, businesses keep both their prices and quality of products high,” Thanh said. Thanh added that these practices ensure not only food safety and hygiene, but maintain the individual company’s image as well as serve to elevate Brazil and India’s prestige in the global marketplace. To add insult to injury, today an excessive number of domestic businesses are getting into the cashew export business resulting in competition that is becoming overly cutthroat and unhealthy.

In 2014, there were roughly 345 companies in the industry and 73% of them had sales of less than US$5 million per year, Thanh said adding that this resulted in poor and uneven quality, causing unnecessary losses for the entire industry.  “This has created an untenable situation for the cashew industry in long-term,” Thanh stressed. Last year, out of 265 companies, 119 (or 49%) of them were ranked substandard in class C. The authorities penalized businesses in class C (for failure to meet the minimum standards of food safety hygiene) in order to maintain fairness in production. The nation simply lacks too many of the critical components that contribute to the safe, quality-oriented food manufacturing and processing environments that exist in Western economies. Vietnam is further challenged by weak government capacity at the local levels. Despite these challenges, if the cashew industry is to expand and maintain sustainable international trade then it’s high time for a new strategy and progressive safety regimes to be put in place for the cashew industry, Thanh concluded.

Source: http://english.vietnamnet.vn

Ghana: Cashew nuts processing companies out of job

Eleven out 12 local cashew nut processing companies have closed down because of stiff competition from foreign businesses.

The foreign businesses buy raw cashew nuts and export them, a development which has denied the local companies of raw cashew nuts to process.

This came to light when the Minister of Trade and Industry, Ekwow Spio-Garbrah (Dr), paid a visit to the Mim Cashew and Agricultural Products Limited (MCAPL) as part of his three-day tour of industrial establishments in the Brong Ahafo Region.

It is estimated that Ghana produces 65,000 metric tonnes of raw cashew nuts per annum, while the current installed cashew capacity is approximately 70,000 metric tonnes.

However, MCAPL, the only operating cashew processing company now, can only process 5,000 metric tonnes of cashew because of lack of raw cashew nuts.

The Managing Director of MCAPL, Mr Joseph Yeung, who briefed Mr Spio-Garbrah about the situation of the cashew processing industry in the country, said unless some policies were put in place immediately, the industry would totally collapse.

“There are clear advantages from processing the raw cashew nuts locally, since that creates a number of jobs, as well as generates extra revenue for the country,” he said.

Mr Yeung called for the imposition of huge taxes on the exportation of raw cashew nuts to ensure that a larger percentage of the produce was retained in the country for processing before it was exported.

Closure of Ivorian border

Mr Yeung explained that prior to the closure of the Cote d’Ivoire border, the company was able to purchase 50 per cent of its raw cashew nuts needs from that country.

However, with the closure, he explained, “we are forced to purchase the raw cashew nuts from Burkina Faso at high cost, while operating at 60 per cent of installed capacity”.

He said the company which was set up in 2008 with a processing capacity of 300 metric tonnes increased its capacity to 7,000 metric tonnes in 2014.

Spio-Garbrah’s response

Responding, Mr Spio-Garbrah stated that the visit had given him a clear idea about the existing problem, adding that there was the need for a stakeholder meeting to see how to resolve the problem.

- See more at: http://graphic.com.gh/news/general-news/46047-cashew-nuts-processing-companies-out-of-job.html#sthash.UQVt2N7U.LxUsgcWx.dpuf

Ghana’s cashew potential estimated at $56 million annually

Ghana’s annual revenue from exporting raw cashew nuts is estimated at 56 million dollars, Mr Joseph Yeung, Managing Director of the Mim Cashew Processing Company, has revealed.  He said value of processed cashew kernels, which is 21 per cent of the 65,000 metric tons of the annual raw cashew produced is also expected to earn the country 102 million dollars. Mr Yeung, disclosed this when Dr Ekwow Spio-Garbrah, Minister of Trade and Industry paid a working visit to the company’s plant site at Mim in the Asunafo North Municipality. He explained Ghana has numerous opportunities from processing cashew nuts and advised the government implement policies that would make the industry attractive for rapid economic transformation and development. Mr Yeung noted that prior to the border closure by Ivory Coast, the company was able to procure about 50 per cent of raw cashew nuts through Sampa, but now it is forced to purchase nuts from Burkina Faso at high cost and more risk.  

He said the company is operating at 60 per cent of its installed capacity and employing more than 1,000 local staff, adding that if it is able to operate fully, the company would require additional 600 staff with a possible income to the community of no less than GH₵ 1,800,000.00. Mr Yeung emphasised the need for the government to carry out immediate action to save the “agonising processing industry”, from shutting down, and this he said would be done before the next cashew season in 2016. “Otherwise the processing industry will be doomed with a huge loss of jobs and revenue to Ghana”, he said. Mr Yeung said that the current installed cashew processing capacity in the country stands at approximately 70,000 metric tons.

He said the only operational  processing this year would only be 5,000 metric tons with 11 out of the 12 existing processors being closed down. Dr Spio-Garbrah, advised the cashew processing companies to meet and come out with recommendations that would guide the government to design and implement policies to enhance the sector.  He commended the company for the job opportunity it has created for the local people, and assured management that government would ensure that the cashew industry is revived to create more jobs.

source: http://www.myjoyonline.com

Ghana: Gov’t keen on growing cashew sector

Government will soon evaluate all available remedy options to salvage the collapsing cashew processing industry; one of the key interventions could be a ban on the export of raw cashew nuts (RCN) Mr. Ekwow Spio-Garbrah, Minister for Trade and Industry, has hinted.   He said it has become imperative to take crucial decisions like banning exports of RCN to protect industries, and that government is awaiting an official report from the cashew processing industry players to better inform any such decision.

“If it becomes necessary to ban RCN exports to reactivate all the closed processing factories we will not hesitate to do so, considering the employment opportunities and other important benefits these factories offer to growth of the economy,” Mr. Spio-Garbrah disclosed when he paid a familiarisation visit to Mim Cashew & Agricultural Products Ltd. (MCAPL) in the Brong Ahafo Region. 

Of the 12 existing cashew processing companies in the country, 11 have currently shut down operations -- with only the Mim Cashew and Agricultural Products Ltd. still in business, but operating below its installed annual production capacity of 7,000 metric tonnes. The cashew processing industry is bogged-down by a plethora of challenges: insufficient supply of RCN is the principal problem that has forced industries out of business. Shortfall in supply of RCN is the result of limited production in the country, as against higher installed processing capacity amidst excessive export of RCN. Ghana produces about 65,000mt/year while installed processing capacity is currently estimated at 70,000mt.

Until 2013, Ghana used to trade (export and processing) around 150,000-200,000mt of RCN per year -- with the huge deficit supplement imported from Cote d’Ivoire through the borders. The Ivorian Authorities in 2013 banned export of RCN to Ghana via the border. The situation has since pushed the RCN price up by 166% from GH¢1.5 per a kilo to GH¢4, thus making it non-competitive for processors to buy. Mr. Joseph Yeung, Managing Director-MCAPL who conducted the Trade Minister around the facility, said processing of RCN locally has enormous economic advantages to growth of the economy, especially employment creation and revenue generation.

According to him, the value of annual processed cashew kernels (21% of 65,000mt) is estimated at US$102million as against US$56million expected to be generated from that same quantum of RCN when exported. He added that on average, it requires at least 200 personnel to process 1,000mt/year.

Mr. Yeung prayed for quick intervention to save the “agonising cashew processing industry”, which he indicated must be done before the next cashew season beginning 2016 in order to avert further imminent job-losses and protect its rich revenue generation element as well; adding, “Any intervention aimed at protecting the processing industry must also take famers’ interests into cognisance”. MCAPL was established in 2008 with an initial processing capacity of 300mt/year, and it increased its capacity to 7,000mt in 2014. The management of the company had planned to move some of its jobs to the community where they buy RCN as a way of improving the income in those communities where employment opportunities are hard to come by, but the challenging business environment has shattered that dream.

Source: http://thebftonline.com

China remains largest trade partner of Vietnam in 6 months

HANOI, July 13 (Xinhua) -- Vietnam posted 32.1 billion U.S. dollars in trade revenue with China in the first half of 2015, registering the largest amount among other trade partners of the country, Vietnam's General Statistics Office (GSO) said on Monday.

Specifically, during the six-month period, China remained the biggest supplier of commodities for Vietnam with some 24.4 billion U.S. dollars worth of products, up 23.9 percent year-on-year, the GSO said on its website in the June monthly report.Meanwhile, Vietnam exported some 7.7 billion U.S. dollars worth of products to China in the period, up 3.6 percent year-on-year, said GSO.Vietnam mainly exports farm products to China while importing fruit and vegetable, fertilizer, machinery, phone and accessories, steel and material for garment and textile industry, among others.

In H1, Vietnam earned 77.7 billion U.S. dollars from exports to foreign markets, said GSO, adding that the country spent 81.5 billion U.S. dollars on imports.Regarding Vietnam's exports of major agro-forestry-fishery products, China remained the largest consumer.According to a report released by Vietnam's Ministry of Agriculture and Rural Development (MARD), in H1, Vietnam pocketed 1.318 billion U.S. dollars from exporting 3.055 million tons of rice, down 10.5 percent in value and 6.2 percent in volume year-on- year.China remained the largest importer for Vietnamese rice in the five-month period, accounting for 36 percent of the market share.

However, during the period, Vietnam's rice exports to China witnessed a decrease of 19.61 percent in volume and 22.61 percent in value year-on-year, said MARD.In the six-month period, Vietnam shipped abroad some 614 million U.S. dollars worth of 422,000 tons of rubber, down 5.1 percent in value and up 22.3 percent in volume year-on-year.China, Malaysia and India remained the three largest consumers of Vietnamese rubber, accounting for 72.26 percent of the market share.For exports of cassava and its related products, in H1, Vietnam exported 2.83 million tons of cassava, worth 844 million U.S. dollars, up 50.5 percent in volume and 42.6 percent in value year- on-year.China continued to be the biggest importer of the item, while accounting for 88.71 percent of the market share, up 52.08 percent in volume and 46.28 percent in value year-on-year.

During the period, exports of 150,000 tons of cashew nuts brought Vietnam 1.08 billion U.S. dollars. China was the largest importer of Vietnamese cashew nuts, with 39.98 percent of market share, said MARD.Concerning imports of automobiles, in H1, Vietnam imported over 56,000 completely built up (CBU) units with the greatest figure from China, said the country's Ministry of Planning and Investment (MPI).Specifically, according to Vietnam Customs, during five-month period, Vietnam imported 13,405 CBUs from China, posting a remarkable increase of 327.32 percent compared to the same period of 2014.Regarding foreign direct investment (FDI), during six-month period, China ranked eighth among countries, regions having FDI in Vietnam with 147.38 million U.S. dollars in newly-registered and added capital, said MPI's Foreign Investment Agency.

Source: http://www.shanghaidaily.com/a