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Vietnam advised to lessen reliance on cashew imports

By Pham Thai - The Saigon Times Daily
Thursday,  May 24,2012,20:41 (GMT+7)
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Vietnam advised to lessen reliance on cashew imports

By Pham Thai - The Saigon Times Daily

HCMC – Experts deem it necessary for Vietnam’s cashew industry to reduce its dependence on imported materials for sustainable development, but this perspective looks unattainable as local farmers are turning their back on the crop.

According to the Ministry of Agriculture and Rural Development, the country’s cashew export turnover surged from US$650 million in 2007 to US$900 million in 2010. In the meantime, the export volume of cashew nuts only rose by 20%, from 152,000 tons to 180,000 tons.

In 2011, the cashew industry with the export turnover of US$1.35 billion officially joined the list of the sectors that fetch more than US$1 billion in export turnover each year.

Despite such an impressive achievement, the local cashew industry has become more and more dependent on imported raw cashew. The import volume increased from 200,000 tons in 2007 to 430,000 tons in 2011, with no signs of a stop yet.

While the cashew industry is aiming at the export turnover of US$1.5 billion, local cashew growers are turning their back on the industry.

Pham Van Tong, vice chairman of Binh Phuoc Province government, rang the bell of alarm over this situation at the Golden Cashew Rendezvous 2012 held by the Vietnam Cashew Association (Vinacas) in Nha Trang.

Binh Phuoc is considered as the cashew capital of the country, with 150,000 hectares under cashew cultivation. However, some 30% of the total cultivation area is old cashew trees that have been harvested for over 30 years, Tong stressed.

Cashew is under competition pressure from other crops with higher economic values like rubber and coffee. More than 2,400 hectares of cashew has been chopped down since the year’s beginning, said the provincial vice chairman.

Dong Nai, the province with the second largest cashew growing area, shares the same fate. Tran Van Vinh, vice chairman of Dong Nai, said the fact that cashew products of the province are well-received in traditional markets and have penetrated new markets does not help farmers stick to cashew cultivation.

Apart from low purchasing prices, the tenuous linkage between relevant parties in the cashew value chain, especially the relationship between enterprises and farmers, is the main reason why cashew growers are turning their back on the cashew industry. Cashew processors pay attention to purchasing only and neglect investment in material zones, said Vinh.

According to the agriculture ministry, Vietnam currently has to import some 50% of the raw cashew, mostly from West African and Southeast Asian countries.

Speaking at the event, a cashew importer remarked that the processing capacity had exceeded material supply capacity. The fact that Vietnam is more and more dependent on imported cashew materials poses a great risk to the future of the industry.

“They cannot provide Vietnam with raw materials forever. At present, many African countries like Mozambique and Tanzania have intention to switch to deep processing to add value to exports. There is no reason for them to keep supplying materials for the third country to process and export to the consumption markets such as the U.S. and EU at high values,” he said.

Sharing this view, Joseph Lang, managing director of Kenkko, a large cashew importer and distributor in the European market, said the African Cashew Alliance expected to preliminarily process 35% of the raw cashew produced in these countries by 2020. Many corporations and companies in the world will pour their capital into the processing projects in Africa.

“It is to say these countries will no longer be suppliers of cheap cashew materials for Vietnam but strong competitors of the country,” he said.

Lang suggested Vietnam should promote mechanization and automation to reduce dependence on manpower and labor costs. On the other hand, enterprises need to study how to boost output, diversify supply sources and increase the value of cashew through value-added processing methods.

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Giấy phép Báo điện tử số: 321/GP-BTTT, cấp ngày 26/10/2007
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