Cashew nut prices have hit the roof and seem to be on a sustained rally due to a crop shortfall in Vietnam. Traders said that the rally is scary as market prices have crossed $5 per pound and touched a record high of $5.35-5.50. India produces 6-7 million tonne raw cashew per annum and was until recently the leading supplier of kernels to the global markets.
“Shortfalls in the nut crop in Vietnam and Cambodia have affected the market sentiments. The shortfall is reported to be about 40% but the market is reacting to it in a scary way. Prices are at historic high and demand seems to be still resilient,” said Pratap Nair of Vijayalakshmi Cashews. Demand is robust for cashew nuts despite competing nuts like almonds and hazel nuts selling at a discount, he added.
Traders were expecting the demand to slip due to high prices but surprisingly, in the last 4 months, the market has surpassed the previous peak of 5.00 seen briefly in October 2016, Pankaj said. According to market reports, nut ingredients market, in terms of volume, is projected to grow at a CAGR of 5.7% from 2014 to 2019.