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‘Rising health consciousness to perk up global cashew demand’.
Jan 04, 2024

With the demand for cashew remaining robust, the markets – both domestic and global – have remained vibrant in 2023, driven mainly by the growing popularity of the commodity as a health-conscious snack choice.

The rising awareness of nutritional benefits of cashew, particularly in western markets, has augmented the sales, especially when the consumers are opting for healthier snack alternatives. However, the demand was also subject to fluctuations due to the residual impacts of the Covid pandemic, which affected consumer spending patterns and disrupted global supply chains, said J Rajmohan Pillai, Chairman of Beta Group which owns the brand NutKing.

On the pricing front, he said the cashew industry witnessed significant volatility due to supply chain challenges, including increased logistics costs and production inefficiencies which had a direct impact on prices. Besides, weather anomalies in key cashew-producing regions like West Africa and Southeast Asia led to fluctuations in crop yields, thereby affecting global supply and prices. The geopolitical landscape, particularly trade policies and international relations involving major cashew-exporting countries, also played a critical role in shaping the price dynamics, he said.

Rapid shift

In India, he said the cashew market has seen a rapid shift in the consumption pattern in recent years, primarily owing to flavoured assorted cashew products occupying an increased share in the retail market space. However, the market is likely to be hampered as the local population prefers other lighter snacks, available at lower prices, for on-the-go snacking.

Largest consumer

Quoting figures, he said India remains the world’s largest consumer of cashews, processing almost half of global cashew kernels and consuming 40 per cent of the global output. The market size is expected to grow from $2.31 billion in 2023 to $2.79 billion by 2028.

On the prospects in 2024, Pankaj N Sampat of Samsun Traders said, 'we can expect the market to be steady. Downside is very limited. Unless something dramatic happens on the supply side, there will not be any big jump in prices. But I have a strong feeling that prices in 2024 will be somewhat higher than the lows we have seen in Q2/Q3 of 2023.

Cashew supply, according to him, has been comfortable for the last few years mainly because of built-up over-supply, which is almost completely used up. There is not much chance of any big increase in supply in the short term. On the contrary, there is some doubt about what impact El Niño will have on the 2024 crop, especially in Vietnam and Cambodia.

There is a reasonable possibility of a rise in consumption due to the lower prices and better availability, coupled with a good probability of economic growth in most countries, he added.

thehindubusinessline.com

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