The Indian walnut market is currently under intense scrutiny following a major customs scandal at Nhava Sheva Port, threatening the stability of walnut supplies and highlighting the persistent vulnerabilities in the country’s import verification systems. Customs officials recently detained a container ship suspected of concealing at least 46 containers of Chinese walnuts, misdeclared as Afghan to exploit the zero-duty regime under the South Asian Free Trade Agreement (SAFTA).
This operation, uncovered with intelligence from the Department of Revenue Intelligence (DRI), uncovered an alleged duty evasion of around ₹50 crore, with authorities arresting one individual and imposing extensive vessel detainment. The probe sheds light on deeper structural issues: India’s 100% tariff on walnuts from China, the US, and Chile protects domestic growers but creates a substantial incentive for fraudulent documentation, especially when global kernel yields are higher for imported walnuts than for local ones. This incident not only disrupts immediate walnut flows but signals a likely tightening of import regulations, potentially affecting pricing and availability in the domestic market for months to come.
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Walnut kernels
light quarter
FOB 3.35 €/kg
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Walnut kernels
light amber pieces, 8-12 mm
FOB 2.30 €/kg
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Walnut kernels
light broken, 4-8 mm
FOB 2.95 €/kg
(from CN)
📈 Walnut Prices & Market Sentiment
| Origin | Type | Location | FOB Price (EUR/kg) | Weekly Change | Sentiment |
|---|---|---|---|---|---|
| China | Light Quarter | Dalian | 3.35 | 0 | Neutral |
| China | Light Amber Pieces (8–12 mm) | Dalian | 2.30 | 0 | Neutral |
| China | Light Broken (4–8 mm) | Dalian | 2.95 | 0 | Neutral |
| China | Light Pieces (8–12 mm) | Dalian | 2.85 | 0 | Neutral |
| US | Light Halves (Organic, 80%) | London | 4.60 | 0 | Stable |
| India | Light Halves (Organic) | New Delhi | 5.40 | 0 | Firm |
🌍 Supply & Demand Dynamics
- Import Disruption: Detention of 310-container vessel disrupts short-term supply for major Indian buyers.
- Origin Preferences: US and Chilean walnuts offer higher yields (450–500g/piece) versus local (around 350g), fueling demand for imports.
- Price Gap: Kashmir (US$4.20–5.40/kg in-shell), US (US$6.70/kg), Chile (US$8.40/kg)—incentivizing traders to find tariff workarounds.
- Customs Crackdown: Expect tightened checks, possible delays, and increased due diligence for future walnut and dry fruit imports.
📊 Market Fundamentals & External Influences
- Policy Intervention: India’s 100% import duty for non-Afghan origins, zero-duty under SAFTA for Afghanistan.
- Fraud Incentives: Routes via Iran, Gulf ports, forged documentation artificially give Chinese/other walnuts Afghan origin.
- Parallel Practice: Similar schemes seen in arecanut, black cardamom, and garlic imports, so dry fruit scrutiny may extend beyond walnuts.
- Trade Rivalry: Industry tips by rival traders contributed to enforcement action.
🌦️ Weather/Harvest Outlook
- Kashmir Region: Current weather is stable; no major anomalies expected for walnut crop in the coming weeks.
- Global Supply: No significant adverse weather reported in California or Chile, meaning global supply reliability is strong—however, Indian import restrictions may be the primary bottleneck.
🌏 Global Production & Trade Comparison
- India: Major consumer, smaller exporter. Highly sensitive to import flows due to protective tariffs.
- US & Chile: Large producers of high-yield walnuts, but shut out of Indian market unless duties are evaded or quotas eased.
- China: Significant supplier for Indian demand, but now under scrutiny after misdeclaration scandal.
📆 Trading & Strategic Outlook
- Expect short-term turbulence for traders relying on SAFTA-based imports or transhipment routes.
- Heightened regulatory checks may delay shipments and add risk premiums to non-verified origins.
- Indian domestic prices likely to stay elevated until import flow normalizes—local kernels remain at premium levels (FOB New Delhi: €5.40/kg).
- Importers should pre-verify documents, expect longer lead times, and consider spot purchases to mitigate supply risks.
- Monitor for further government announcements or importer blacklistings stemming from probe.
⏳ 3-Day Regional Price Forecast
| Exchange/Location | Product | Forecast Price (EUR/kg) |
|---|---|---|
| Dalian, CN | Walnut kernels, Light Quarter | 3.30 – 3.40 |
| London, GB | US Organic Light Halves | 4.55 – 4.65 |
| New Delhi, IN | Indian Organic Light Halves | 5.35 – 5.45 |









