<p></p><p>India is the world’s largest consumer of cashew nuts with consumption ranging from 1,70,000 - 1,90,000 ton. It is also one of the largest processor and exporter of kernels. India exported 91,559 ton of cashew kernels, valued at R2,598 crore, in 2010-11. Rajesh Ravi of FE talks to Hari Krishnan R Nair, chairman of The Cashew Export Promotion Council of India, on the global cashew trade and the Indian scenario.Has the global economic crisis affected cashew trade? Do you see a slowdown in the traditional consuming markets?Cashews have a reasonably long chain between the grower and the final consumer. The uncertainties in the global economic scenario have caused many intermediaries to reduce their stock-holdings and forward purchases of cashews. This has caused the perception that demand has fallen and prices have also eased in response. However, the consumption pattern of cashews in developed countries is affordable. This pattern is counter-recessionary, as it is less expensive than eating at restaurants. Therefore, cashew consumption was not affected negatively in previous recessions and we expect it to be similar this time too.What about cashew nut pricing? Is it competitive enough when compared to other nuts?</p> <p>Cashew prices spiked for a short period of 3 months in July-September 2011 driven by supply uncertainty from Cote d’Ivoire, which went through a political crisis. This has been solved and prices are back at competitive levels, especially when compared with other snack-nuts such as pistachios, walnuts, pecan nuts and macadamia nuts. Cashew prices are slightly higher than almonds. However, cashews are the snack-nut consumers’ distinct favourite. Therefore, we expect that the current pricing will lead to increased consumption in 2012. </p><p> Have new markets come into trade? Has the health benefits of nut helped in sustaining demand in the traditional markets of US and Europe? </p><p>While the USA and Western Europe remain large markets, the Middle East has emerged as a third big export market for India. Other growing markets are the Mediterranean region, Eastern Europe and China. Since 2000, results of various studies have confirmed that the good profile of unsaturated fats in nuts, combined with the abundance of micronutrients, vitamins and proteins, make all nuts including cashews a natural healthy food. Therefore, cashews have been included in many popular diets, which have helped sustain demand in the USA and Europe. However, in some traditional markets such as India, there is still a misconception that cashews contain cholesterol, while the actual fact based on nutrient profile is that cashews may actually bring down the risk of heart disease. </p><p><b>What about the supply of raw cashew? Is it keeping pace with the demand?</b> </p><p> We estimate that over the last few years, there has been very little carry-forward of cashew stocks from one year into another and at some time every year, there is shortage of cashews in stock. Thus, there is scope to increase production of cashews without serious negative effect on prices. </p><p><b>Where does the country stand in the global cashew industry?</b> </p><p>In production, import and processing of raw cashews, India leads the world. In export volumes, we are second after Vietnam as India also consumes more cashews than any other major producing country.Last FY, India was a net importer with value of raw nuts import higher than the value of kernel exports? </p> <p><b>Do you think this trend is healthy for the industry?</b> </p><p>Last year witnessed a shortage of crop in India, combined with a booming Indian economy and a poor export demand due to global uncertainties. I do not see this as a lasting trend. What is most important for the industry is that we continue to be globally competitive, with a mix of high productivity in cultivation, cost–effective processing and effective marketing – both overseas and in India. </p><p> Is the Indian supply keeping pace with the demand? What about the initiative to bring new area into cashew farming? </p><p>The Indian farmer has matured a lot in the last decade. He makes informed decisions based on economic realities. An enlightened farmer today will only grow cashews in part of his farm and may prefer round-the-year yielding trees such as rubber or coconuts over cashew.However, the high employment intensity of cashew is unparalleled. Therefore, it is in the country’s interest that cashew farming be encouraged with appropriate support and subsidies. New plantations are coming up in the rich soils of middle India.However, farmers in traditional cashew growing regions such as Kerala do not believe that cashew can give so much of income. They still hold old notions that cashew is at best, a wasteland crop, which provides supplementary income, and are replacing cashew with other trees. </p><p>What are the constraints faced by the processing industry? </p><p>The current processing methods of the industry are highly labor intensive. Every five kg of cashew kernels represents two man-days of work. Since wage-levels in India have gone up in the last few years, the labor element alone in the cost of a kg of cashews is about R100 now. This is a very high number and workers prefer jobs in other sectors such as retail shops. So, the industry has to find ways to increase productivity of labor. The challenge is to continue to leverage our advantage of expert work force, while making judicious investments mechanisation. </p><p>How is the Indian domestic consumption growing? Will it be a preferred market in the future? </p><p>Cashew has entered middle-class Indian cuisine as a regular staple in all sweets, namkeen, cakes and confections and even regular curry-gravy dishes. With the explosive growth of the middle class, Indian demand is growing. The challenge is to make sure that other imported foods do not replace cashews in Indian food. As health-consciousness in diet grows, we have to effectively establish and communicate the fact that cashews are healthy and do not contain cholesterol, so that they continue to be an important part of diet. </p><p> </p><br><p></p>