Thursday, August 13 2020

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Vinacas tells cashew enterprises to trade carefully

Update: May, 13/2020 - 17:30

 

Workers sort cashew nuts at Bình Phước Processing Cashew and Agriculture product plant in southern Bình Phước Province. — VNA/VNS Photo  Đình Huệ 

HÀ NỘI — The Việt Nam Cashew Association (Vinacas) recommends cashew processing enterprises remain calm and try not to sell off their products to avoid potential losses.

A representative of the association said: "There are more demands for the nuts, but exporters should be careful in trading."

Vinacas thinks though the pandemic has been controlled in China, it was still not yet under control in many countries and territories around the world, especially the US and Europe, which are traditional cashew export markets of Việt Nam and where customers are requesting early delivery due to fears global freight may be in trouble.

According to the association, in the United States and the EU, restricted travel has led to an increasing demand for essential food reserves, including processed cashew nuts. Especially, in the EU, importers were looking to buy goods to store because of the concern that the COVID-19 pandemic in Africa will affect the supply of raw cashew nuts for Việt Nam and India. 

At the same time, India is still greatly affected by the pandemic. According to the Indian Cashew Industry Federation, about 15,000 tons of raw cashew nuts are in stock at processing plants across the country due to the blockade.

As a result, some customers now require Vietnamese factories to deliver the nuts as quickly as possible due to concerns that global cargo transportation may be in difficulty, raising freight rates. 

However, Vinacas tells local processing plants to be careful in trading their products, suggesting they import raw nuts if there is a suitable price. 

Vinacas added: “Cashew processing enterprises should not sign future contracts if they cannot buy raw cashew nuts at good prices, because when the pandemic is under control, the prices may increase again.” 

The association also mentions the high risk of buying raw cashew nuts from Africa without having a contract for their processed nuts or having a plan to resell the materials.

Instead, it advises plants to purchase raw cashew nuts in the country in order to contribute to the maintenance and development of local raw material areas. 

Local cashew processing plants need to closely monitor market developments and should also have a plan for 2021, says the association.

Before the pandemic, the Vietnamese cashew industry aimed to export US$4 billion in 2020. As the pandemic hit the price of cashew nut exports, the industry adjusted its export plan to $3 billion. — VNS

 

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