Vietnam Cashew Kernels Under Pressure as New US Tariffs Bite

Vietnam’s cashew kernel market is under clear downside pressure as weak international buying coincides with firm raw nut costs and a new 12.5% US tariff on Vietnamese kernels. Nearby prices are holding only because raw cashew nut inventories sit in strong hands, while demand from Europe and the US remains seasonally and macro-economically subdued. Global buyers are increasingly resisting higher offers, with some even pushing to delay contracted shipments by around one month. At the same time, new US country‑specific duties are eroding Vietnam’s price competitiveness against African origins and India, likely redirecting a share of US demand and reinforcing a cautious, wait‑and‑see stance among importers.

Prices

Vietnamese kernel prices softened at the lower quality end during the week to 1 August. W320 offers were indicated around USD 3.08–3.35/lb, with actual trades reported near USD 3.08/lb for medium quality. Converted to EUR using roughly 1 USD = 0.92 EUR, this implies a working range of about EUR 6.25–6.80/kg, with business concentrated at the lower band.

Higher grades remained relatively expensive but lack follow‑through demand: W240 traded around USD 3.45–3.60/lb (approximately EUR 7.00–7.40/kg), while W180 was quoted near USD 4.20–4.60/lb (about EUR 8.60–9.40/kg). Buyers are pushing back on these values, with some asking for deferred shipment by roughly one month, highlighting short‑term oversupply in kernels relative to current buying interest.

Supply & Demand

Raw cashew nut trading is thin, but prices remain firm thanks to concentrated ownership. Ghana‑origin nuts are offered around USD 1,530/tonne CFR Ho Chi Minh City (roughly EUR 1,400/tonne), with Ivory Coast near USD 1,500, Guinea‑Bissau at USD 1,760 and Nigerian Ogbomosho at about USD 1,520/tonne. Financially strong traders holding these stocks are under little pressure to liquidate, preventing a sharper correction in kernel values.

On the demand side, European supermarkets, roasters and packers are in a seasonally slow phase and are running lean inventories. US importers likewise keep stocks tight amid uncertainty about consumer spending, energy costs and the risk of further import duty changes. This combination of cautious downstream purchasing and firm raw material ownership is creating a stand‑off, with limited liquidity and a soft bias in kernel offers.

Fundamentals & Policy Shifts

The key structural shift this week is regulatory rather than purely fundamental. The United States has implemented an additional 12.5% tariff on most Vietnamese imports under new country‑specific measures related to forced‑labour enforcement, replacing the previous temporary global structure. Vietnamese cashew kernels are now directly disadvantaged versus African origins such as Ivory Coast, Benin, Ghana and Tanzania, which remain exempt from the new measure.

India faces a 10% tariff into the US, while Nigerian kernels are subject to the same 12.5% rate as Vietnam. This tariff tiering is likely to steer a portion of US buying toward duty‑free African suppliers, particularly for bulk mainstream grades like W320 and W240. For Vietnam, this raises the risk of more kernels being redirected into Europe and other markets, potentially increasing competition and capping upside there despite the firm raw nut background.

Short‑Term Outlook & Trading Ideas

In the very near term, the balance of risks points to further mild downside or sideways movement in Vietnamese kernel benchmarks, especially for medium grades. Demand from Europe and North America is unlikely to improve sharply before late Q3, while the US tariff shock will take time to be fully priced into trade flows. Strong hands in raw nuts should, however, limit any disorderly price collapse.

• Buyers (EU & non‑US): Consider staggered coverage on dips for W320/W240, focusing on medium quality where Vietnam is conceding most. Avoid overcommitting to high grades until demand visibility improves.
• US‑focused importers: Reassess Vietnam exposure given the 12.5% tariff and compare landed EUR-equivalent costs with Ivory Coast, Benin and Ghana. Short‑term substitution toward duty‑free African origins may be justified.
• Processors & traders: Maintain disciplined raw nut selling; firm RCN prices are your key buffer. Be prepared for more frequent requests to delay shipments and for tougher price negotiations through August.

3‑Day Directional View (EUR)

• Vietnam FOB kernels (W320, W240): Bias soft to sideways; small discounts likely where shipment delays are requested.
• India FOB kernels: Largely stable in EUR terms, tracking Vietnam but cushioned by diversified market access.
• Europe FCA kernels (NL hub): Mostly steady; minor downward pressure possible on spot offers if additional Vietnamese volume is redirected from the US.