<p></p><p>Cashew market last week witnessed sluggishness as both buyers and sellers adopted a wait and watch mode. Average prices were around $3.90 for W240; for W320, at around $3.50; W450 and SW320, at around $3.30; Splits at around $2.40; Pieces at around $2.00 all per lb (fob).Even in the domestic market , things were very quiet. With uncertainty in the European economy and financial markets, there is concern about demand for non-essentials. Given the high prices, European buyers seem to be content buying in small tranches for shorter periods. US demand, however, seems to be steady, but no large buying has been seen , Mr Pankaj N Sampat, a Mumbai-based dealer told Business Line.</p> <p>On the supply side, he said, “the lower processing in May/June and maybe even July means that there is no pressure on shellers to push for sales, except for those who do not have forward sales and have to sell on a month-to-month basis”.The Raw Cashew Nut (RCN) market was also quiet. Except for Guinea Bissau, there is not much unsold left in the origins. Price levels were approximately at $1,350 a ton for Guinea Bissau; $1,300 a ton for Senegal/Gambia; $1,100 a ton for Benin and $1,000 a ton for Ivory Coast (IVC). </p><p>Given the high prices paid for bulk of the RCN, those shellers who are able to make forward sales are reluctant to sell at the current lower levels. Buyers do not seem to be willing to pay high prices because they are not confident about off take in coming months.This trend of thin forward books makes the market vulnerable. Any sudden move by shellers or buyers could sway the market with sudden dips and spikes. This volatility makes long term planning more difficult, Mr Sampat said. The trend will likely remain hazy during the rest of the year, he said. </p><p>The supply side for 2012 is more or less known – in terms of volume (some shortages) and price (higher end of the range). So, the price movement for the rest of 2012 will depend on what happens on the demand side – and that continues to be very uncertain, he said.If demand turns out to be bad as the buyers say it is, “we could see market settling at the lower end of the current range or maybe even drifting a little lower. On the other hand, if off take picks up and buyers need to buy larger than expected volumes in July/August, we might see a slight upward movement in prices – given the fact that there is no replacement RCN available till almost the end of the year”. </p><p>If prices dip too much, some might see a buying opportunity and take on some forward positions. And, if prices are up too much, shellers who have bought RCN at higher levels may see an opportunity to lock in sales at reasonable prices.To sum up, it would be safe to assume that the market will settle in the $3.50 to $3.75 range for the foreseeable future unless something dramatic happens, he added.<br></p><p></p>