<p></p><p>A temporary squeeze in kernel supplies in the next 2-3 months is likely as several processors in India and Vietnam have cut production since December due to high raw cashew nut (RCN) prices. At the same time, it could also result in some processors moving in a hurry to buy when West African RCN shipments start in mid-March.</p> <p>The cashew kernel market was steady during December-January moving in the range of $3.75-3.90 for W240 and $3.30-3.40 for W320. Last fortnight, some processors in both the origins sold at lower levels - business reported as low as $3.60 for W240 and $3.20 for W320. These lower levels were offered by very few processors, while others asked 10-20 cents higher. </p><p>During last week, the range of offers was W240 from $3.60-3.85, W320 from $3.20-3.40, W450 from $2.95-3.10, SW320 from $3-3.10, SW360 from $2.80-2.90, SSW from $2.45-2.55, splits $2.45-2.55, pieces from $1.65 to $1.80/lb (fob). Prices for brokens have moved up by 10-20 cents in the last couple of months with very little volume being offered from Vietnam. However, India exports negligible quantities of brokens. Indian market, both for wholes and brokens, has been quiet for the last couple of weeks but there was reasonable activity during December/January. “We expect domestic market to pick up activity after mid-March,” Pankaj N Sampath, a Mumbai-based dealer told Business Line. </p><p><b>SLIP IN RCN PRICES</b> </p><p>Tanzania RCN prices have come down from a peak of $1,450 a ton c&f to $1,300-50 a ton, but most of the slightly smaller crop was sold at higher levels. Availability from Mozambique is smaller than normal. Outlook for 2014 Northern crop, which constitutes over 75 per cent of world production, is good so far. There is no adverse news from any origin. The only concern, at this time, is the impact of the changes in regulations in Ivory Coast, the biggest producer in Africa. Small quantities have been shipped from Nigeria. Shipments from Benin, Ghana, Ivory Coast will start in second half of March. After some trades for small quantities in January at high levels, offers have come down in the last two weeks and the current range is Nigeria from $900 to $950 a ton c&f / Ivory Coast from $1,000 to $1,050 a ton c&f / Benin & Ghana from $1,100 to $1,150 a ton c&f.</p> <p>Although RCN prices have come down in the last couple of weeks, there is still a 15-20 cents disparity between current RCN and current kernel prices, he said. Following a reasonable growth in usage in all markets in 2013, there are signs that usage will be good during 2014 as well due to the high prices of other nuts and relative stability of cashew prices at the lower end of range of last few years. </p><p>The trade feels that the market may see some volatility between now and May 2014 depending on news about the crop progress and RCN price movements and after that it should stabilise and move in a narrow range for rest of the year. If there is any strong kernel demand from the US and/or EU during March/April, the RCN prices will remain firm. </p><p> </p><br><p></p><br>