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Cashew industry lowers export targets

Update: July, 26/2012 - 10:16

by Xuan Huong

HCM CITY — Viet Nam hopes to ship 61,468 tonnes of cashew in the second half of the year, bringing the year's total to 150,000 tonnes for an export turnover of US$1 billion, according to the Viet Nam Cashew Association (Vinacas).

Speaking at a review conference held in HCM City yesterday, Dang Hoang Giang, Vinacas general secretary, said 88,532 tonnes of cahew worth $602.1 million had been exported in the first half of the year. This marked a year-on-year increase of 28.2 per cent in volume and nearly 14 per cent in value, he said.

However, average export price for the period was $6,826 per tonne, down 8.1 per cent against the same period last year, he said.

The US remained the largest buyer of Vietnamese cashew, followed by China.

Given current market difficulties and a shortage of raw material, the association has lowered its export target for this year, Giang said. This is a reduction of 9.7 per cent in volume and 24.3 per cent in value over 2011, he added.

Delegates at the conference said cashew businesses have encountered many difficulties in the first half of the year, including shrinking output, a shortage of working capital, and falling overseas demand as a result of the ongoing economic crisis.

These difficulties will continue in the second half, they said, adding that exports will become more difficult since importing countries will raise technical barriers.

Firms must be prepared to face the tougher situation, they warned.

The Chinese market, for instance, has strengthened quality checks on imported food items, as well as imposed different tariffs on border trade, said Nguyen Duc Thanh, Vinacas deputy chairman.

Giang said reduced cashew cultivation area and output will be a big challenge to the industry in the coming time. He said it was time for the Government, various localities, the association, businesses, scientists and farmers to work together and work out measures to develop the cashew industry in a sustainable manner.

Cashew output this year was 264,810 tonnes compared to 301,730 tonnes in the last crop, Giang said.

Delegates also complained about many small businesses taking part in cashew exports, making oversight of the industry more difficult. The small firms usually slashed prices to boost export, adversely affecting the whole industry, they said.

Nguyen Thai Hoc, Vinacas chairman, said the association will petition relevant agencies to address this problem. He suggested that the Ministry of Industry and Trade grants export permits only to enterprises that meet hygiene and food safety standards.

In the long run, the ministry should impose more eligibility conditions on cashew exporters, he said.

Nguyen Van Chieu, general director of Long An Food Processing Export JS Company, said the Government should increase funding to support the industry in adopting advanced technology to reduce costs.

Conference delegates also asked banks to create conditions for enterprises to access bank loans at lower interest rates so that they can maintain operations in the remaining months of the year.

Vinacas, meanwhile, should provide updated market and pricing information to its members in a timely manner, they said.

With a fall in cashew output in many producing countries including Viet Nam, India and Brazil, supply will fall short of demand in the later months of the year, and prices will go up, said Ta Quang Huyen, general director of the Hoang Son 1 Company.

Last year, Viet Nam exported 166,109 tonnes of cashew, earning $1.35 billion, a drop of 16.46 per cent in volume but an increase of 20.13 per cent in value over 2010. — VNS

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