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Falling prices of almonds, cashews and hazelnuts weigh down on the Mintec Global Nut Index

December 1, 2021

2 mins read

The Mintec Global Category Index for nuts fell by 3.4% in the four weeks to 17th November 2021, to USD 6,511/MT. Previously, the index culminated in mid-September at USD 7,029/MT, sustaining a bullish run since December 2020. However, since the 2021 September peak, the index has fallen by 7.4%. The decline is primarily attributed to a fall in prices of almonds, cashews and hazelnuts, whilst Brazil nut prices also eased in November after previously rallying since November last year.

The Mintec Benchmark Prices for standard 5% almonds FAS US fell by USD 0.55/lb (-22%) between 16th September and 18th November, to USD 1.93/lb, on the back of subdued demand and pressure on sellers to shift stocks to free storage space. Nonetheless, the benchmark gained almost 4% in the week of 25th November, up to USD 2.0/lb as lower prices have stimulated additional demand.

In the cashew market, the Mintec Benchmark Prices for W320 cashews FOB Vietnam eased by 2.3% in the four-week period to 25th November, to USD 3.03/lb, and down by USD 0.27/lb since mid-September. Limited demand for nuts amid soaring freight costs from Southeast Asia caused sellers to discount material for prompt shipments to get sales on books to meet financial obligations. In addition, buyers from western markets have focused on sourcing cashews early for Christmas this year amidst the logistical bottlenecks. With most of the large contracts done, the market has been relatively quiet recently and inventory levels at destination markets are plentiful, according to trade sources.

Cashew production in East Africa, where the harvest is underway, is projected to be unchanged from the last year, according to data from the INC (International Nut and Dried Fruit Council). Tanzania is forecast to produce 220,000 tonnes of cashews (+0%), and output in Mozambique is anticipated at 55,000 tonnes (+0%).

The Mintec Benchmark Prices for Turkish hazelnuts CFR Northwest Europe plummeted by USD 98/100kg (-14%) between 16th September and 25th November, to USD 592/100kg. Prices in USD-denominated markets have been exposed to the fluctuating USD-TRY exchange rate. The Turkish Lira lost about 40% of its value against the dollar in the twelve months to the end of November. The slide accelerated in the past couple of months after the Turkish Central Bank started slashing the one-week repo rate, against recommendations from prominent economists to continue with monetary tightening amid the high inflation. The last round of interest rate cuts was implemented on 18th November, with the bank cutting the one-week repo rate by 1% percentage point to 15%. This was the third interest rate cut in Turkey since September this year.

In the Brazil nut market, prices eased for the first time since November 2020. The Mintec Benchmark Prices of Brazil nuts (mediums) CIF Rotterdam fell by 8% in the week of 25th November, to USD 6.05/lb. Nonetheless, the benchmark is up 142% y-o-y following supply tightness in Bolivia, the main Brazil nut producer, and exacerbated by the freight disruptions.

Jara Zicha
Jara Zicha

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