KOCHI: A combination of factors like high cost of the imported raw cashew cut in export incentive and rise in wages in Kerala has pulled down cashew exports during this fiscal. The shipments have plunged 37 per cent in volumes and 31 per cent in value in November 2015 from a year ago.
As per the data of The Cashew Export Promotion Council of India, India’s cashew export in November stood at 7045 tonnes valued at Rs 362 crore. For eight months to November 2015, the export at 64,220 tonnes valued at Rs 3248 crore is down by 18 per cent in quantity and 8 per cent in value.
Almost 85 per cent of the cashew for exports are processed in Kerala at Kollam. The processing in other states is mostly for domestic consumption. The prices of raw cashew which is imported to meet the processing requirement as the local production is insufficient have touched $1750 per tonne.
“The high cost of the nuts and the increase in wages by 35 per cent in Kerala have led to the closure of many processing factories in Kerala. Of the 750 factories, only around 100 are working. As a result the shipments have fallen,” said P Somarajan, proprietor of Kailas Cashew Exports, a major player.
With costly nuts and increased wages, the cost of production of cashew has gone up considerably. “Even if the price of cashew kernels in the global market improves from the present $3.50 to 3.60 per pound, it will be a loss to the exporters,” he said.
The export incentive which was cut from 5 per cent to 2 per cent was raised to 3 per cent last month. But the exporters say it has been neutralised by the rise in price of raw cashew.
Cashew exports touched a record Rs 5,545 crore in 2014-15. But the shipments are likely to be lower this year as raw cashew prices are expected to come down only by March-April, when the season begins in the largest producing countries of Ghana and Ivory Coast in West Africa.
