In-shells

Currently, all eyes are focused on the SH crops. Although it is just reflecting about 10% of global production, these quantities are still needed to bridge the period until the NH crops are available around February/March of next year. Especially for the higher quality standard sourcing regions and entities. It is too early to make a judgment on the quality of the SH crops, as well as how the local governments will decide on price flooring or in-shell export restrictions.

From the NH crops, there is still sufficient in-shell available in India and Vietnam. The only question mark that remains is the quality as the majority is material from the second and third flush with lower out-turns and higher off-grades.

We have seen in-shell prices slightly moving up due to reduced availability in material of good quality. Still, this increase has not impacted the Kernel prices as of today.

Kernels

Demand has started to pick up in main destination markets. Europe is ahead in consumption figures versus last year at this time. This indicates that consumers have continued to snack their favored nut. Promotions have also been supportive for these results. Furthermore, in the US, and after a long period of less imports and negative consumption figures, we noticed off-take has started to pick up again and is getting corrected.

De-stocking is at peak prices in main destination markets. This will (most likely) keep supporting the spot pricing and we may encounter slight increases as we enter into Q4 where last minute orders are at normal practice and will need to be monitored closely.

Cashew prices remain favorable where WW320 pricing continues to be in the range of $2,40/lb FOB to $2,60+/lb FOB - depending on the period, quality, and quantities. This is being observed by retailers and brands as they intend to cover as much as possible on forward positions up until the end of FY24. For Kernel processors, the challenges remain unchanged - increasing costs of production, high interest rates significantly impacting their carry-costs and increased spot in-shell pricing. All of these factors do not leave Kernel processors much room to ask for a premium to hedge their forward commitments.