Vietnam Cashew Association lowers export target amid weak demand
As cashew exports in the first half of 2022 fell by 9.2% against the same period last year, the Vietnam Cashew Association (VCA) has to adjust down its annual export target to US$3.2 billion.
Tran Van Hiep, Vice Chairman of VCA, said the Russia-Ukraine conflict is a major cause for the falling exports, as Russia was the 14th largest importer of Vietnamese cashews and the conflict had the country cut off from the SWIFT system, causing payment difficulties for Vietnamese exporters.
Another cause is the mounting inflation in the US and EU. Higher inflation leads to higher prices for essential items, leaving consumers with no choice but to cut back on non-essential items, such as cashew nuts. The demand for Vietnamese cashew fell accordingly.
In addition, China is sticking to its zero-COVID policy, holding back the importation of the Vietnamese nuts, he added.
Amid contracting demand from abroad, VCA has to lower its export target to US$3.2 billion for 2022, US$600 million less than the target set at the beginning of the year.
Cashew exports earned Vietnam over US$3.6 billion in 2021. In the first five months of 2022, Vietnam shipped abroad over 206,000 tonnes of the nuts worth US$1.19 billion, down 7.81% in volume and 6.81% in value, the Vietnam Cashew Association reported.
Although the turnover decreased, the average export price increased by 1.45% compared to the same period in 2021, reaching about US$5,792 per tonne.