Vietnam eats into India's cashew export plans

KOCHI: Vietnam may spoil India’s plans to raise its cashew exports as it has cornered a large share of raw nuts from West Africa for processing.

India's cashew export has been falling in the last two years. From 1.2 lakh tonnes in 2014-15, it plummeted to 82,302 tonnes last year.


Zooming price of imported raw nuts and dip in export prices have made export unviable for India. India imports over 60% of its raw nut requirement for processing. "Vietnam has been buying raw nuts from West Africa at a higher price to meet its export requirement. As a result the raw nut price has escalated to $2450 per tonne," said P Sundaran, chairman of Cashew Export Promotion Council of India. India’s export had looked good in the first two months of the fiscal.

As its processing cost is lower, Vietnam has been selling below India’s rate. "The US and Europe have started buying from Vietnam as its cashew is cheaper though our cashew is superior in quality. We need support from the government through incentives for export," Sundaran said.

Aggressive selling by Vietnam has pushed down the cashew prices in the export market. It has tumbled from over $ 5 per pound to $4.8. "Vietnam has targeted an export of 3.65 lakh tonnes for which it has been buying and stocking raw nuts till September-October," said K Prakash Rao, managing partner of Kalbavi Cashews.

India is hoping to buy more raw cashew of better quality from Indonesia and East Africa, where the harvest season is expected to be a month earlier by August-September. "The Indian production is better than last year which may meet the needs of local manufacturers," Rao said.

Indian cashew industry is gearing up for good domestic season with the onset of festival season from August. `` Post GST the stock of most traders is empty and hence they are likely to buy to raise inventory. At present the price in the local market is around Rs 810 per kg compared with Rs 725 per kg in the export market. The prices may rise further when the festival season begins,’’ Rao said.

India is currently the largest consumer of cashews with consumption touching 3 lakh tonnes, two times the export. The consumption is growing at a rate of 5% annually. 

Indonesian Steel Producers Urge Gov't to Monitor Imports

Indonesian steel importers can enjoy free import duties on alloy steel. However, many of these importers are actually importing carbon steel (that have a very low alloy content). Therefore, this import policy of the government is not tight enough. Currently, the government is studying the issue.

Indonesia and other ASEAN countries have become major export markets for Chinese steel. China, the world's largest steel producer, is plagued by a major steel oversupply and therefore is in a position to - competitively - export steel to ASEAN nations.


Although steel imports into Indonesia declined in June 2017, Triseputro replied that declining steel imports is a normal phenomenon during the Ramadan month ahead of the Idul Fitri festivities. Based on data from Indonesia's Statistics Agency (BPS), Indonesia imported USD $450.4 million worth of steel in June 2017 (in terms of volume this is equivalent to 735,528 tons), down nearly 25 percent (y/y) from steel imports in the same month one year ago. However, these data are distorted because the Ramadan and Idul Fitri started earlier this year.

If we take a look at steel imports in the January-June 2017 period, then we detect a 19.8 percent (y/y) increase to USD $3.52 billion (or 6.65 million tons) worth of steel that was imported into Indonesia.

The World Steel Association recently said China has been boosting its steel output in the first half of 2017. China's steel production rose 3.9 percent (y/y) to 419.7 million tons in the January-June 2017 period. This puts more pressure on steel prices

Indonesia's Export & Import trade Performance in April

Indonesia's exports were recorded at USD $13.17 billion in April 2017, down 10.3 percent month-on-month (m/m) compared to March, but up 12.6 percent year-on year (y/y) compared to April 2016.

On a monthly basis, Indonesia's export performance fell due to falling non-oil & gas exports (specifically a steep decline in animal fat and oil exports), while crude oil exports fell a whopping 50.7 percent (m/m) to USD $302.5 million, and gas fell 18.1 percent (m/m) to USD $587.2 million. But also in terms of volume exports of crude oil and gas fell: 43.7 percent (m/m) and 24.3 percent (m/m), respectively.

Indonesia's non-oil & gas exports in April declined 7.4 percent (m/m) to USD $12.19 billion. However, the figure is a 12.9 percent (y/y) improvement compared to non-oil & gas exports in the same month one year earlier.

Combined, in the first four months of 2017, Indonesia exported a total of USD  $53.9 billion of goods, up 18.6 percent compared to USD $48.90 billion in the same period one year earlier, driven by a 19.1 percent (y/y) recovery in non-oil & gas exports.

Most of Indonesia's April 2017 non-oil & gas exports were shipped to China (USD $1.57 billion), followed by the USA (USD $1.36 billion), the European Union (also USD $1.36 billion), and India (USD $1.19 billion).

Meanwhile, imports into Indonesia rose 10.3 percent (y/y) to USD $11.93 billion in April 2017, but fell 10.2 percent (y/y) on a monthly basis. Non-oil & gas imports stood at USD $10.32 billion, down 6.3 percent (m/m) but up 9.2 percent (y/y) compared to the same month one year earlier. Imports of consumer goods grew nearly 26 percent (y/y) but increases in imports of capital goods and raw materials were smaller.

Lastly, imports of oil & gas into Indonesia fell 29.3 percent (m/m) to USD $1.61 billion in April but rose 18.3 percent (y/y).

Indonesia's export reaches $11.64 billion in June

Export of products from Indonesia was recorded at $11.64 billion in June, the national statistics bureau announced.

That compares with 12.92 billion shipment of the products overseas in June of last year.
The cumulative exports by June grew 14.04 percent to $79.96 billion from a year earlier, head of the bureau Kecuk Suhariyanto told a press conference at the bureau headquarters.

Experts have said that a seasonal factor of shorter working day and a trend of lower commodities' prices have contributed to the decline of shipment of Indonesia's products overseas in June.

Indonesia is the world's biggest exporter of thermal coal, crude palm oil, and the world's third largest exporter of cocoa and rubber, as well as home to the world's second-biggest copper mine.

On import, it reached $10.01 billion in June compared with $12.02 billion in the same period last year, Suhariyanto disclosed.

Cumulative imports by June were down 9.60 percent to $72.33 billion from a year ago, he revealed.

Indonesia's trade performance witnessed a $1.63-billion-U.S. dollar surplus in June, Suhariyanto said. ■

Indonesia Export Import Data and Trade Report

Products Indonesia exported the most in 2015 are: 


List of 10 Largest Indonesia Exports of 2015: Mineral Fuels, Oils, Distillation Products, etc. (23.01%); Animal, Vegetable Fats and Oils, Cleavage Products, etc. (12.42%); Electrical, Electronic Equipment (5.7%); Rubber and Articles (3.93%); Pearls, Precious Stones, Metals, Coins, etc. (3.66%); Vehicles Other Than Railway, Tramway (3.61%); Machinery, Nuclear Reactors, Boilers, etc. (3.47%), Footwear, Gaiters and the Like, Parts (3%); Wood and Articles (2.66%) and Articles of Apparel, Accessories, Not Knit or Crochet (2.65%).


List of 10 Largest Importer Countries to which Indonesia Exported Products the Most in 2015: Japan (12%); United States of America (10.8%); China (10%); Singapore (8.4%); India (7.8%); Republic of Korea (5.1%); Malaysia (5.1%); Thailand (3.7%); Taipei, Chinese (3.4%) and Philippines (2.6%).

Indonesia Export Import Data