Vietnam hyperactive in the cashew market
Audio 01:39
This cashew nut buying policy has enabled West Africa to sell all of its production in 2021, but the size of Vietnamese stocks will inevitably have an effect on transactions in the coming months.
© CC0 Pixabay / Mahesh Patel
By: Marie-Pierre Olphand Follow
2 min
On the cashew nut market, Vietnam confirms its central position: the country has imported record quantities of nuts and today finds itself with exceptional stocks.
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Leading importer of raw nuts, leading processor and leading exporter of cashew kernels, Vietnam was already the king on the market.
But it achieved a new feat, that of brewing unexpected volumes when it was thought at the end of August that its port activity had been considerably slowed down by the strict confinement imposed on Ho Chi Minh City.
This has clearly not been the case, imports have reached record levels and Vietnamese stocks are incredibly high.
Vietnam's exceptional stocks will have an impact on the next campaigns
It's hard to understand why importers bought so much and so quickly, comments Pierre Ricau, analyst for the agricultural newsletter N'kalo.
Is it just to store and sell to processors at low prices?
Or has the country over-anticipated global growth in consumption?
The demand for cashews is certainly increasing, but perhaps not commensurate with Vietnamese stocks.
This all-round purchasing policy has enabled West Africa to sell all of its production in 2021, but the size of Vietnamese stocks will inevitably have an effect on transactions in the coming months.
Local processors have enough to power their factories and might not be in a rush to buy the new global production.
Processors like Mozambique and Côte d'Ivoire will be less vulnerable
The first to suffer on the continent are likely to be the next to arrive on the market, that is to say the countries of East Africa located in the southern hemisphere whose campaign is staggered, namely Tanzania, Mozambique and even Madagascar.
Their production schedule is usually an asset, as they harvest when no one else is, but if Vietnam still has large stocks in January, they may sell for less or at a lower price.
By 2022, those who will do the best they can, will be the least dependent on their exports, and therefore those who have the capacity to locally process part of their nuts, this is the case of Mozambique or the United States. Ivory Coast where factories are multiplying.
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