Cashew Kernels Edge Higher as India Weather Risk Meets Firm Vietnamese Supply

Indian and Vietnamese cashew kernel prices are holding a firm-to-bullish tone, with India edging higher and Vietnam steady at elevated levels, while European prices remain discounted but stable. Short-term, tight kernel margins, an uncertain Indian monsoon and strong Asian and EU demand point to mildly rising offers rather than any correction. Global nut trade is expanding within a broadly positive agri-export environment, and Vietnam’s wider export rebound underpins aggressive raw cashew nut (RCN) imports and stable kernel output. India, however, faces mounting concern over a potentially weak 2026 monsoon, which could tighten future raw nut availability and support kernel prices into Q3 if rainfall deficits persist. In Europe, particularly the Netherlands, ample warehoused stocks keep spot prices relatively soft versus origin, but replacement costs are being guided upward by firmer offers from India and Vietnam.

Prices & Spreads (all values in EUR/kg)

Note: USD-denominated trade references (e.g. Vietnam above USD 7,000/t) have been converted at ≈1.08 USD/EUR for orientation only.

Supply, Demand & Trade Flows

Vietnam remains the global price setter for kernels, with recent reports confirming export prices breaking above USD 7,000/t in mid‑May 2026 amid strong buying from China, the US and Europe. Although this information is slightly older than three days, it underpins why today’s Hanoi offers for WW240/WW320 in the EUR 7.3–6.5/kg range are being defended.

More broadly, Vietnam’s merchandise exports are surging in 2026, with total trade turnover up 25% year-on-year in the first five months, reinforcing logistics utilisation and container availability for agri-exports including cashew. High RCN imports in 2025 and into early 2026 ensure good kernel supply, but processors’ margins are still squeezed by elevated raw nut costs, reducing appetite to discount kernels aggressively.

India’s cashew sector is under competitive pressure from Vietnam, as noted by recent Indian government reporting that highlights Vietnam’s dominant role in the global cashew value chain. Nonetheless, domestic and regional demand for Indian kernels remains firm, encouraging incremental price increases at New Delhi for both wholes and pieces. In Europe, the Netherlands continues to act as a key entry and distribution point for African and Asian nuts, with 2025 data showing steady imports of edible nuts, including cashew, underpinning current inventory.

Weather & Crop Outlook (IN, VN)

Cashew yields in India and Vietnam depend heavily on warm, humid conditions and timely monsoon or rainy-season onset. For India, the 2026 southwest monsoon is a key risk: private forecasters and recent financial press coverage suggest this season could be one of the weakest in more than a decade, with below-normal rainfall expected.

Real-time observations from weather communities indicate that monsoon onset has been delayed and spatially uneven, with discussions of changing rain patterns and only gradual inland progression as of early June 2026. While the core cashew harvest is largely past in many states, subpar moisture could curb flowering and nut set for late crops and influence 2027 orchard conditions, providing a bullish undertone to Indian kernel prices.

Vietnam’s key cashew-growing zones are not currently exposed to acute short-term weather shocks, and the broader agricultural complex is reporting strong export performance across categories. Combined with record 2025 RCN imports into Vietnam highlighted by Indian export monitors, this points to stable near-term Vietnamese kernel supply, though processors remain wary of overcommitting forward if RCN costs fail to soften.

Fundamentals & Market Drivers

• Global demand: China, the US and Europe continue to absorb high volumes of Vietnamese kernels, with earlier 2026 customs data showing strong month-on-month rebounds in exports after a weak January. Snack and ingredients demand appears resilient despite broader macro uncertainty.
• Competing origins: West African RCN has been ample but not cheap, limiting downside in kernel prices. India’s official trade reporting underscores how Vietnam’s scale and efficiency allow it to capture more value, pressuring smaller Indian processors and partially shifting export flows away from India.
• Macro & logistics: Vietnam’s strong overall trade and infrastructure utilisation support regular sailings to Europe and Asia, while the Netherlands benefits from robust nut-handling capacity and established importers. This keeps freight relatively predictable, but any escalation in Red Sea or other shipping disruptions would quickly raise CIF/CFR costs.
• Policy & trade: Vietnam’s cashew sector is targeting around USD 5 billion in kernel exports in 2026, reinforcing a policy focus on maintaining growth momentum and market share. India continues to explore quality and traceability initiatives in its annual trade strategy, aiming to differentiate kernels and support price realisation.

3‑Day Price Outlook (IN, VN, NL)

Given currently quoted levels and the short time frame, the following outlook is directional rather than absolute:

• India (New Delhi, FOB/FCA): Mildly bullish. With monsoon uncertainty and firm local demand, W320/W240 are likely to edge another ≈0.5–1.0% higher over the next three trading days, while lower grades (LWP, SWP) track slightly behind.
• Vietnam (Hanoi, FOB): Stable to slightly firmer. Exporters are expected to defend current WW240/WW320 offers, with upside risk of ≈0.5% if fresh inquiries from China or Europe emerge, given elevated replacement costs discussed in mid‑May market commentary.
• Netherlands (Dordrecht, FCA): Mostly stable. Comfortable warehouse stocks and competitive intra‑EU supply suggest flat prices in the coming three days, though buyers should anticipate firmer replacement levels later in June if origin offers continue to rise.

Trading Outlook & Risk Pointers

• Buyers in Europe (NL and wider EU): Consider covering near‑term W320 needs at current FCA levels, which still sit well below replacement costs implied by Indian and Vietnamese FOB offers. Leave some volume open for potential macro-driven dips, but bias toward incremental coverage.
• Asian and Middle Eastern buyers: For prompt shipments ex‑Vietnam, accept current WW320 prices as a new floor and prioritise quality/ship schedule over squeezing for discounts. In India, stagger purchases over June–July to hedge monsoon-related supply risk.
• Origin processors (IN, VN): Avoid overcommitting long on kernel sales against still-expensive RCN; maintain a balanced book with short-to-medium tenor contracts and include review clauses for any sharp freight or policy changes in H2 2026.