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  • Exports decline, but optimism rises in cashew industry 12/28/2023

    Dec 28th, 2023

    An early draft of the annual report of the Cashew Nut Association of Cambodia (CAC) registers a slight decline in exports but the mood remains upbeat in the industry. CAC President Silot Uon told Khmer Times that the report paints a positive image of the industry in Cambodia. The report puts production at 656,000 MT of raw cashew nuts (RCN) a 7.6 percent decline in volume. Approximately 618,000 MT headed to Vietnam, in the form of exports at a value of $ 837 million which is a fall of 16.9 percent. About the report due to be released in January, Silot said, “This shows a positive image of the cashew industry in Cambodia. I think the cashew product will be stable in 2024.” Asked about the negative figures in production, he said, “Not very negative as it’s becoming stable. This is due to the farmers alternating cashews with cassava. They do not want to change and want to keep the old tree safe. Also, the local enterprises are trying to compete in buying cashew produce which is another reason why the numbers exported to Vietnam have also decreased.” Attractive interest rates from local banks for local processors have not helped ease the working capital shortfall with unfavourable loan conditions. Therefore the bulk of RCN comprising as much as 95 percent went to Vietnam, leaving a mere 5 percent for local small and medium processors. This in turn led to a reduction of jobs in communities. Add to the mix was the volatility of price. Across 10 provinces, CAC members account for nearly 19,802 families with both direct and indirect members, the indirect ones being from 40 agriculture cooperatives in seven provinces. From 700,000 hectares, the total farmland accounts for around 450,000 hectares. A non-profit organisation, CAC is an independent voluntary entity with a modest budget covering merely the administrative costs. However, its achievements dwarf its miniscule budget. Joining hands with a slew of organisations, CAC has participated in and organised a variety of activities including workshops, field trips and demo farms, community warehouses, outreach services, post-harvest management, data collection, winning over RCN buyers, providing assistance in acquiring loans, apart from MoUs with various international bodies like GIZ. The challenges facing the cashew nut industry are daunting, to say the least. With rising prices of local commodities there has been low competitiveness in foreign markets for a number of reasons, like the shortage of skilled labour, the outflow of RCN, lack of modernization in technology, escalating costs of logistics and lack of tax incentives. The latter, however, is being reviewed by the government for incentives and exemption. In addition, farmers are forced to compromise on unacceptable prices due to reasons like a lack of warehouses with drying platforms to dry and store them till auction time. Although CAC has a presence in 10 provinces, in reality, it is essentially a voluntary outfit and has limitations when approached for help by farmers. According to unofficial estimates, areas under cashew cultivation could hit 700,000 hectares as a survey of nursery plants revealed nearly 6.7 million were sold out by the end of the year.