Nearly 78,000 hectares of cashew have been cut down by farmers in the past five years to make room for cultivating other crops like rubber and pepper, which is ascribed to price instability, low yield and poor supporting policies from local relevant authorities.
The cashew industry, during the first 11 months of 2013, reached its yearly target of US$1.5 billion in exports, according to the Ministry and Agriculture and Rural Development. Recently, the Viet Nam Cashew Association increased its forecast for the export value of cashews from $1.5 billion to $1.7-1.8 billion for this year.
With an increasing demand for cashew in the global market, Vietnam expects a higher export volume this year, to reach US$1.8 billion, Vietnam News Agency (VNA) reported.
The recent rise in cashew prices has signalled a race to export cashews in the remaining months of the year.
Viet Nam hopes to ship 95,000 tonnes of cashew in the second half of the year, bringing the year's total to 210,000 tonnes, an increase of five per cent over last year, according to the Viet Nam Cashew Association (Vinacas).
Speaking at a conference held in HCM City last Saturday to review the industry's first-half performance, Dang Hoang Giang, Vinacas general secretary, said some 115,000 tonnes of cashew worth US$716 million was exported in the first half of the year.
Though there are plenty of cashew nut trees in Udupi, especially in the hilly regions of Brahmavara and Kundapur, cashew processing industry is facing acute shortage of raw material. There are about 229 cashew nut processing factories in the district and these factories depend on cashew nuts imported from South Africa,Vietnam and other countries.
In an effort to save the cashew industry, local authorities have been moving ahead with the special plans to develop cashew growing areas.Cashew nuts were once the key export item of Vietnam. However, Vietnamese farmers recently have given up farming because the profits from cashew gardens cannot feed them.
Cashew processors and exporters are facing problems like short supply, high raw material prices, and falling export prices, Thoi bao kinh doanh newspaper reported.
This year's cashew harvest was completed last month, with the Ministry of Agriculture and Rural Development saying output was down 20-50 per cent from a year ago due to unseasonable rains at the end of last year.
According to GDC, the first quarter of 2013, the export volume of the country is estimated at 43 125 tonnes, valued at U.S. $ 262.15 million, up 15.4% and increased 1.84% in value the same period in 2012. The U.S. is the largest market of Vietnam cashew, accounting for 25.15% of total turnover, with 65.93 million, followed by the market turnover of over 10 million dollars in the first quarter include: China China 52.17 million, accounting for 19.9%, Netherlands 28.92 million, accounting for 11%, Australia 17.64 million, accounting for 6.73%, Russia 12.8 million, accounting for 4.88%
China has always been gaining the upper hand in doing business with Vietnam. Experts believe that Vietnam has been yielding to the big foreign partner on many issues.