1. Cashew Kernel Markets in 2016 - INDIA
18-20 Feb 2016, Al Bustan Rotana, Dubai
Cashew Kernel Markets in INDIA
Bola Rahul Kamath
Bola Surendra Kamath And Sons
18/02/2016

2. WHY INDIAN MARKET IS SO IMPORTANT
18-20 Feb 2016, Al Bustan Rotana, Dubai
WHY INDIAN MARKET IS SO IMPORTANT
Cashew World
Market share (Aprox)
Second Biggest Producer of RCN
30%
Biggest Importer of RCN
60%
Biggest Processor of RCN
Biggest Manufacturer of CK
Second Biggest export of CK
22%
Biggest consumer of CK
37%
Fastest growing market ? 

3. Assumptions and Challenges
Indian Trade Data is for Financial Year (April/March)
Carry Forward inventory assumed constant, Yield assumed constant at 23%
Cashew Kernel import figures are ignored.
Challenges in Estimation
Large unorganised sector, so impossible to gather correct data.
cashew farmers
cashew processing units in India
cashew traders
No Reporting authority or Board like Almond Board of California

4. Past …. Estimation of Indian Consumption
Quantity in MT
Raw Cashew Nuts
Cashew Kernels
Year
Indian Crop
Import
Total Processed
Production
Export
Consumption
Absolute
CAGR
(1)
(2)
(3) = (1)+(2)
(4) = (3) X 0.23
(5)
(6) = (4)-(5)
Growth %
544000
578884
258263
126667
131596
613000
755959
314861
117991
196870
65273
11%
650000
939912
365680
118952
246728
49858 6%

5. Past ….Cashew Consumption Vs Other Dry Fruits
CASHEW KERNELS
ALMONDS
PISTACHIOS
Year
Consumption
Absolute
CAGR
Import
Growth %
131596
21087
4972
196870
65273
11%
49330
28243
24%
9198
4226
17%
248316
51446 6%
65385
16055 7%
10813
1615 4%

6. Cashew Kernel Price Chart
Year
C K Price (Rs/kg)
214
220
207
200
273
269
267
335
404
441
460
509

7. Analysis .. Why Indian Market is slowing Down
Have prices gone up too fast ?
Prices in USD has gone up + Indian Rupee has weakened
We are using average export realization in rupees as benchmark to compare prices. But, India uses more of broken grades and its prices have gone up more sharply
Indian Inflation is near to zero, Nut prices going up at 10% per annum

8. Present …… Estimations for 2015-16
Qty in MT
April/Jan
Change
Domestic RCN Production
650000
675000 4%
Import of RCN
834139
881307 6%
Total RCN for processing 5%
Estimated RCN Inventory in hand
150000
170000
13%
RCN Processed
CK Output at 23%
306852
318851
Export of Cashew Kernels
100208
84424
-16%
Supply of CK into Indian market
206644
234427

9. Future … Looking into 2016.. Reasons for worry
Cashew Kernel Export price has touched Rs 532/Kg in Dec 2015 compared to Rs 473/Kg in Dec (Up 12%)
Almond, Pistachios, Raisin prices have collapsed in last 4 months.. But cashew prices are still going up
After a long gap, Almonds have become cheaper than cashews
Dry fruit traders lost plenty of money
Changes in taxation system like GST can increase cashew prices, further effecting consumption.

10. Future … Looking into 2016.. Reason for Worry
Fall in Commodity prices / share markets is reducing the cash flow with consumers.
Banks have become extremely cautious in lending due to increased NPA.
Working capital required for cashew industry has gone up 50% in last two years.
Food Safety Authorities have become more vigilant

11. Future … Looking Beyond 2016 .. Long Term
India is the fastest growing big economy in the world.
India will be worlds’ third largest economy by 2025
Indians love cashews in everything they eat, be it biscuit, sweets, dishes or chocolate
Cashews/dryfruits as gifts will never go out of fashion
Now Indians believe cashews are their local product!

12. Year 2016 will be extremely challenging.
Conclusions
Year 2016 will be extremely challenging.
Whether Cashew Prices need a correction ? Its question of time
Thank you and All the Best.