Global Nuts Market Summary

• Bangladesh's cashew industry is grappling with severe market challenges, primarily due to the impact of cheaper imported cashews, which are undermining local processor competitiveness. The production cost for local processors is approximately TK 1,300 per kilogram excluding profits. However, imported cashew kernels priced between TK 1,400 and TK 1,500 per kilogram undercut the necessary selling price of TK 1,950 to TK 2,000 per kilogram required for local processors to remain viable.
• A crucial factor is the tax differential between imported cashews with testa (skin) taxed at $4.1 per kilogram and processed cashews taxed at $6 per kilogram, resulting in a tax advantage of TK 101 to TK 107. This has catalyzed a significant shift in import trends, with cashews with testa surging from negligible amounts in fiscal year 2024 to 87% in the first ten months of fiscal year 2026. Consequently, domestic investment is stalling, and local cashew farms are witnessing plummeting prices due to decreased procurement by processors striving to compete with more affordable imports.
• In response to these pressures, the Bangladeshi government is deliberating potential changes to import valuation mechanisms and customs classifications to alleviate strains on domestic processors. The current customs valuation misalignment allows imported cashews to undercut local market prices, thereby discouraging investment in domestic processing. Authorities are reviewing policies concerning these valuation rules, with revisions potentially featuring in the forthcoming national budget to address these discrepancies and support local industry viability.
• The influx of cheaper imports compels local processors to operate below breakeven levels, inciting operational losses and diminishing procurement from region-specific cashew farms, particularly affecting areas like Rangameedi. Farm gate prices for raw cashews have dropped from TK 6,000 to TK 6,500 per month to TK 4,800 to TK 5,200 per month. Since cashew cultivation area expanded substantially post-2021 involving roughly 3,500 farmers, the present market dynamics threaten these farmers' economic stability. Policy realignments are essential to develop a competitive stance for the local cashew industry while safeguarding the livelihoods of farmers who rely on this crop across Bangladesh.