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Cashew Market Update - February 28, 2022

On Inshells:
Northern Hemisphere, 2022 crops:

  • West Africa crops are starting to enter across the region. From a size perspective, crops look to be in line with last year, and in some regions slightly better. To determine the final quality, we will need to wait a few more months.
  • Last season, the crops were considered good in size, but poor drying capabilities combined with longer afloat periods and improper storage conditions have reduced the overall quality drastically.
    The political unrest hasn’t expanded further, which is a positive development for the stability in the region.
  • In Asia, we are noticing heavy rainfall events, particularly in the Bin Phuc area of Vietnam. Since these rain events happened at the very end of the flowering season, we continue to expect crop size will more or less reach last season’s quantities.
  • India crops have started floating in and are beginning to enter the production sites for the local market.
  • The biggest unknown remains in Cambodia, where the official data and what we are actually seeing on the ground are completely different. From a midterm perspective, Cambodia crops will likely continue to grow.


  • Ivory Coast declared the minimum farmer price at the same level as last year. This was not within the expectation of short sellers in RCN & Kernels, who took a combined view on freight costs and currency. As a result, we see an increase in activity and higher demand for spot pricing.
    All together, we see a significant increase of freight rates from Africa to Asia; currently quadruple last year’s rates. We expect rates will continue to increase.
  • Even available RCN in Asia keeps trading at a premium and remains in strong hands, despite an increase in quality concerns as a consequence of improper handling during the export season.
    Execution of RCN shipments in Africa look to be the major challenge this season. There are already increasing delays in execution in both RCN and Kernel shipments. If disruptions continue, we may see spot RCN trading even higher and remain firm.

On Kernels:
With the development in RCN world, we have seen an increase in activity by main destination markets in the recent months. The industry is willing to cover far in advance, even up to mid-2023, against current spot prices. Processors are not able to market, as spot prices vary between RCN and Kernel. Replacement costs are factored into potential interest and we see the destination markets have started to accept these higher levels because ultimately, they remain at very attractive average prices for advanced coverages.


  • Kernel prices today remain at disparity, where the freight impact is likely to become higher this year with increased RCN shipment costs.
  • Global freight rates remain high and continue to move in that direction.
  • For EU/US, we are entering main coverage periods by end-users, which will put further pressure on Kernel availability, as RCN traders are not signalling to reduce prices below replacement costs.

Bullish points:

  • Consumption remains strong, even with increasing shelf prices.
  • Pipelines at destination markets starting to reduce, which will result in unexpected spot coverages.
  • West Africa RCN execution is likely to be impacted by logistical issues and higher freight rates.
  • EU and US industry remains fairly uncovered for April onwards and likely will come together into the market, which will further feed the spot market and squeeze supply.

Bearish points:

  • No signal of short crops across the Northern Hemisphere, despite recent heavy rain events in Vietnam.
  • Low demand from China/India continues.
  • Vietnamese processors may still liquidate limited quantities under replacement costs until their RCN positions are depleted.

Please take care and stay safe and healthy

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