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Cashew Market Update - April 16, 2021

Short crops, logistical challenges, supply chain disruptions, defaults, price renegotiations, COVID-19’s 3rd wave… these are a few buzzwords that we’ve been repeatedly hearing over the last few weeks.

Let’s explore the facts to understand why the cashew market has suddenly turned bullish.

On the inshell side: If the crop delay in Vietnam and Cambodia wasn’t enough, we are now also having to deal with revised projections of a short crop in Ivory Coast and Vietnam. The 2nd flush in West Africa and Vietnam is expected to be over quickly and there might not even be a 3rd flush of any significance. The quality has also started dropping across the growing regions. The crop in India is expected to be good but a surge in COVID-19 cases have led to many cashew growing states beginning to enforce lockdowns.

In line with these developments, prices moved up by another 10% over the last 3-4 weeks even as offers dried up from West Africa. More importantly, we’ve now started hearing whispers of renegotiations and defaults. This is never a good sign for processors who sold kernels forward based on these low-priced raw nuts.

On the consumption side: The kernel market has moved by 20-25 cents over the last couple of weeks. Demand has been robust in the US and EU along with interest coming from China and Asia-Oceania. Shelf prices are at a historical low and retailers are actively promoting cashews. Spot availability in markets remains tight and shipment challenges from Vietnam continue. It’s possible that high spot prices will continue to drive the forward market as well. The backlog of shipments are now beginning to pile up from Vietnam and freight rates have gone up dramatically. The Suez Canal incident added another 3-4 weeks of delays to the supply chain. Similar to the situation for inshells, the kernel buyers are equally worried about the execution of their low-priced contracts.

Trade activity in the Middle East is expected to be slow during the Ramadan month.

The COVID-19 situation in India is worsening fast and this could potentially have a significant impact on the domestic HoReCa consumption. Will this be a repeat of 2020 for India?

Some triggers that may change the direction of the market are highlighted below:

Possible Market Triggers


  • Short crop projections in West Africa and Vietnam. Potentially low in-shell availability with processors in Vietnam in Q4.


  • Inshells getting concentrated with a small group of players.


  • Low spot availability and higher prices led by shipment delays.


  • Robust demand projections across the US, EU and China led by low shelf prices.


  • Defaults and renegotiations.


  • Higher inventory at the start of the year potentially counterbalancing the effects of a short crop.


  • Resurgence of COVID-19 cases in India and the potential impact on demand.

The question everyone seems to have started asking – is this the start of a bull run experienced between 2015-2018 or will it fizzle out? Only time will tell.

Please take care and stay safe and healthy

If you have any comments or suggestions, please write to me at or message me on LinkedIn.

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