Raw Cashew Prices Soar in October 2024: Challenges for Vietnam’s Cashew Industry

Raw Cashew Prices Soar in October 2024: Challenges for Vietnam’s Cashew Industry

October 2024 marks a tough period for Vietnam’s cashew sector as raw cashew prices continue to surge. They currently fluctuate between $1,500 and $1,600 per ton, representing a sharp 50% increase compared to earlier in the year. This surge has placed tremendous pressure on businesses, from producers to processing companies.

Reasons for the Raw Cashew Price Hike

One of the main reasons for this sharp rise is the global shortage of raw cashews, particularly from West Africa, especially Côte d’Ivoire, one of the world’s largest cashew suppliers. The region has faced poor harvests, with production dropping by around 7% due to adverse weather conditions​

Additionally, the Ivorian government has imposed export restrictions to support their domestic processing industry, further tightening global supply​

In Vietnam, domestic supply is also dwindling. Farmers have shifted from cashew cultivation to more lucrative crops, and this year’s harvest has been severely impacted by drought, reducing both the quality and quantity of cashew nuts​

Solutions and Future Directions

In response to these challenges, the Vietnam Cashew Association (Vinacas) is actively working to ease the burden on businesses. Vinacas is petitioning the government and related agencies for support. One proposed solution is to develop domestic cashew-growing areas to reduce reliance on imports​

Vinacas is also working with international partners to ensure that previously signed contracts are honored, urging suppliers to comply with agreed terms​

With the unprecedented rise in raw cashew prices, Vietnam’s cashew industry faces significant challenges. Dependence on imports, coupled with domestic supply shortages, has made it difficult for many businesses to maintain production and profitability. In the future, the development of domestic cashew-growing regions and stronger risk management in international contracts will be crucial for ensuring the sustainability of Vietnam’s cashew industry.