Processing cashew nut for exports (Photo: VNA)

Hanoi (VNS/VNA) -
Minister of Agriculture and Rural Development Nguyen Xuan Cuong has called for greater efforts to address the shortage of raw materials faced by the domestic cashew processing industry, saying that remains the biggest challenge for the sector’s development.   

Unless that obstacle is removed, Vietnam’s cashew industry will not be able to compete with foreign growers and producers, Cuong said at a conference last week on sustainable development of Vietnam’s cashew sector.

According to the minister, Vietnam exported the first batch of cashews in 1988. After 28 years, the country is now the biggest cashew processor in the world, making more than 50 percent of global output.

In 2016, Vietnam earned 2.8 billion USD from exporting 347,000 tonnes of processed cashew and expects to reap 3.2-3.3 billion USD this year. “However, we have to import more than 60 percent of cashew seeds,” Cuong noted.

“Over the past 10 years, cashew tree planting areas have been shrunk and productivity has declined from 1.1 tonnes per hectare to 0.75 tonnes,” he said, adding that many cashew trees are stunted, while some cashew trees have been replaced with industrial trees such as rubber, coffee and pepper.

Le Van Lien, an expert in cashew market analysis, said global demand for raw cashew is rising six percent a year but supply is only increasing by only 3.5 percent due to harvest loss, drought and climate change. This, in turn, is hiking prices.
“The world supply of cashew material is growing slowly, providing Vietnam with a chance to move forward if we can develop high-yield, stable output planting areas.”

Nguyen Khac Hai, general director of PAN Group, an agriculture and food company, said Vietnam should be active in providing raw material sources for itself by replanting.

The southern province of Binh Phuoc, for example, has total cashew tree planting area of 180,000ha but the proportion of old and stunted trees accounts for 30 percent. “We have to find a replanting method to bring more profit to farmers, thereby encouraging them participate in the activity,” he said.

Hai estimated that after replanting, productivity would rise from 1.4 tonnes to 2.4 tonnes per hectare, and farmers’ income would probably double from 35 million VND (1500 USD) to 76 million VND per hectare.

The cost for replanting 1ha of cashew trees and the first year of production is approximately 30 million VND, thus the total cost of the whole area in Binh Phuoc is estimated at 246 million USD, Hai said.

He said the group would support the cashew tree replanting on 10,000ha in Binh Phuoc and ensure all the output is consumed.

Minister Cuong asked the PAN Group and provincial authorities to continue studying new varieties, training human resources and investing more in production value chains to add value to cashew products.-VNA/VNS