Weekly cashews update

May 3, 2008

Cashew market is steady – with a slightly firm undertone for nearbys but not much activity for forwards. No change in prices in the last two weeks - business was done for W240 around 3.20, W320 around 2.95, W450 around 2.75 FOB (some business was done few cents higher as well)

RCN prices from West Africa are also steady but very little new business has been done in last couple of weeks. Brazil has entered the RCN import market after a long gap (their previous import was in 1998/99). Shipments are picking up and after reasonable quantity of old purchases have been shipped, new business will be done. There is still a lot of seed available but there are delays in arrival in India & Vietnam plus some holding back for higher prices. Unless kernel prices pick up for forward positions, processors will be reluctant to pay high prices as there is very limited demand for later positions at the moment

Due to the uncertainty of when – and how much cashews – will be shipped from Vietnam, it seems that kernel market is likely to be more of a spot market for quite some time. This is going to make things difficult for people who want to take forward positions – they will be reluctant to take on any big commitments as they are already caught on the wrong foot and cannot afford to aggravate an already difficult situation

Usage in first quarter has been good in most markets – despite some retail level price increases in some markets. Usage in second quarter must be watched closely to get an idea of extent of buying cashews still to be done for 2008 deliveries and to get some idea of how demand will develop in late 2008 / early 2009


Regards
Pankaj N. Sampat
Mumbai - India