Cashew industry sees bright global prospects despite challenges

According to the General Department of Vietnam Customs, the country exported 641,000 tonnes of cashew kernels for US$3.63 billion last year, year-on-year increases of 23% and 17%.

The US was the largest market, followed by China and Europe.

Notably, China has increased purchases in recent months, in certain months even surpassing the US as the largest importer.

Thai Nguyen Hue Chi, an expert at the Vietnam Cashew Association, said in the past Chinese consumers often used other nuts such as almond and walnut but have consumed more cashew due to its lower prices.

Vietnamese cashew is nutritious, delicious and nutty, and so has become popular and is increasingly used as a cooking ingredient in the Chinese market, he said.

Last year shipments to key markets like Germany, the UK, the United Arab Emirates (UAE), and Saudi Arabia saw a significant uplift, according to the association.

Exports to the UAE surged by 46.6%, while Saudi Arabia witnessed a 40.1% increase.

Industry insiders anticipate cashew inventories in major consumer markets like the US and EU to dwindle after the festive holidays, sparking a rise in import demand in the coming months.

However, the industry faced a wake-up call recently with quality concerns raised by two European and US associations.

In response, the industry has doubled down on quality control, food safety and hygiene measures to safeguard the reputation of the Vietnamese cashew brand.

Pham Van Cong, the association’s chairman, said maintaining the quality of exports is a vital factor for cashew producers and exporters and the industry itself amid increasing global competition.

Vietnam has accounted for a whopping 80% of global exports for 16 years now, the association said.

The country also has the world's most advanced cashew processing equipment and technologies, it added.

The first half of 2023 was a difficult period due to geopolitical crises, monetary tightening by central banks globally, inflation, lower demand in key markets, and consumers tightening their spending.

So the association lowered its export target for the year to US$3.05 billion, US$50 million and US$750 million lower than its own previous target and the one set by the Ministry of Agriculture and Rural Development.

Exports rose significantly since August and especially in the last quarter, and the industry expects to see this continue in 2024, the association said.

Bach Khanh Nhut, the association’s deputy chairman, said the global cashew market is forecast to grow by 4.6% a year in 2022-27.

The global trend towards vegan and plant-based diets has increased demand for nuts and nut-based foods, including cashew.

Vu Thai Son, chairman of Long Son Group, said the cashew industry must also keep abreast of the current green trend and meet consumer demands and the more stringent requirements in terms of environment and social responsibility.

Businesses must demonstrate their social and environmental responsibility to their partners, he added.

According to experts, with major raw cashew supplying countries such as Ivory Coast stepping up exports of processed kernels, Vietnam’s cashew industry needs to focus on improving quality and diversifying products to keep its competitive advantage.

The association and the Vietnam Trade Promotion Agency are set to organise the 13th VINACAS Golden Cashew Rendezvous from February 26 to 28 in Quang Binh Province’s Dong Hoi City.

Being an important trade promotion event for the cashew industry, the event will feature a number of activities such as networking, signing of deals and discussions on production and trading of raw nuts and kernels, and is expected to attract 400-500 local and foreign delegates, he said.