Cashew exports fall on high local demand.

Kochi: Cashew exports continue to be weak with traders focusing more on the domestic market where prices are a tad higher than global market.

Exporters said in the global market, buyers are reluctant to buy large volumes and are opting to near-term contracts. Ideally, the current month used to be a major trading month for cashew kernels, how this year the situation is slightly different.

According to industry experts, buyers in Europe, Japan and Australia purchase a major portion of requirement for the next season during September-October. Europe alone consumes 30% of Indian cashew. US buyers also stock in advance for Christmas and other occasions.

“Processors are content to sell small volumes and buyers also buy what is needed. Because at current levels they will make losses if they are covering short positions and risk appetite for going long is limited in view of uncertainty about future demand,” Pankaj Sampat of Samsons Trading told FE.

“Activity is limited in Vietnam where some processors were selling few cents below India. Brazil continues to be quiet as they do not have much to offer from old crop and do not seem to be in a hurry to sell from new crop,” he added.

Meanwhile, domestic demand continued to be steady for large wholes and broken, traders said. The slowdown in global market could see traders looking more at the Indian market, which has in the recent past shown an increasing appetite for such products.

On the supply side, there is a feeling that prices may soften by early October when arrivals pick up. “In East Africa, everything looks okay on weather front but it is too early to talk about crop prospects, price levels and shipment,” Pankaj said.

Value of exports in April-June 2010-11 is up by 2% compared to same period of 2009-10, while volume during the same period is down by 1.6%.

The total realisation for the period stood at Rs 713.01 crore as against Rs 698.46 crore for the previous period. In 2009-10, India exported 1,08,120 tonne of processed cashew valued at Rs 2,905.82 crore as against 1,09,522 tonne valued at Rs 2,988.40 crore during 2008-09.

Source : financialexpress.com