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Cashew exports increase while challenges remain
Vietnam exported 124,000 tonnes of cashew during the first nine months of this year generating US$696 million and representing a 51.5 per cent year-on-year increase in value and 14 per cent in volume, said the Viet Nam Cashew Association (Vinacas).
Cashew enterprises are boosting imports of raw material as well as taking the initiative to seek new cashew sources in Africa.
Vinacas chairman Nguyen Duc Thanh estimated that the cashew industry would notch up export values of $850 million by the end of the year.
In order to reach the goal, he said, cashew enterprises are boosting imports of raw material as well as taking the initiative to seek new cashew sources in Africa.
Vinacas also petitioned the Government to provide VND50-60 billion ($3-3.6 million) to help farmers expand cashew plantations and attain world-class GAP (good agricultural practice) standards.
In 2006, Vietnam overtook India to become the world's leading cashew exporter, supplying 40 per cent of the total global demand.
Challenges
Local experts, however, said that the country's cashew industry still faced challenges, including scattered and small-scale production, limited co-operation, among cashew enterprises and lack of raw materials.
To fill the shortage Vietnam has had to import unprocessed cashew since 1999, and import volumes hit 200,000 tonnes last year. It is expected to reach 250,000 tonnes this year.
Vu Thai Son, head of Vinacas' trade promotion section, said some 30 small-and medium-sized cashew enterprises are rushing to sell cashew stocks in order to meet loan deadlines.
The current 2 per cent monthly interest rate that businesses have to pay on loans is considered high, so they would rather sell product at a low price to pay off their debts than wait for the market price to increase again, reported several cashew exporters.
The situation has become more challenging as foreign customers take advantage of cashew producers financial difficulties and try to further push down prices, Son said.
Solutions
In light of recent challenges in the cashew market, some banks have agreed to extend loan terms to the end of this year or the beginning of next year, according to Vinacas.
Vinacas has suggested that banks lower interest rates to help cashew businesses recover from hard times, and that local cashew exporters refrain from lowering their prices any further as demand for cashews is believed to surge at the end of the year.
Vietnam now has 220 cashew processors with a total capacity of 600,000-700,000 tonnes per annum.
VNN
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