Cashew nut Supply Chain Challenges in India

Abstract

The consumption demand of cashews has started to surge in the recent few years. The consumer's perception of cashew nut has shifted from a ‘luxury' commodity to that of a ‘health and necessity' commodity. Yet there are many grave issues that limit the growth of raw cashew business in the country. As time passes the intricacies of the trade are growing. Even though the industry is an emerging industry and supports a large number of rural people; it has been observed recently that exports of cashew kernels have decreased and import of raw cashew nuts has increased. The major constraints faced by the industry are insufficient and irregular availability of raw materials and the higher processing cost borne by the cashew processors. The cashew value chain includes both small producers and workers at processing units whose finished products are sold in India and abroad. As a bigger share of profits is captured by the middlemen who are distributed throughout the value chain, small-scale producers are not getting a good price for their crops. Processors in turn are paying lower wages to their workers because of high raw material and processing costs. As far as the utility of supply chain management in the Indian cashew industry is concerned, it must include benefits to both small-scale producers and labourers in processing units. The need of the hour is to explore the Indian cashew industry supply chain for necessary adjustments to ensure a continuous supply of raw nuts to cashew processing units and finding out ways to reduce the involvement of middlemen in the cashew supply chain. While the supply chain challenges of the Indian cashew industry are practically very grave in nature, some efforts are being done on the policy front to tackle the issues.  But the volume of such efforts by the government needs to be scaled up if a visible difference is to be seen in the plight of the Indian cashew industry in the future. So the best way of thriving in this industry is to understand the supply chain of the business appropriately, and take corrective measures to remove the bottlenecks.