In 1988, the country started processing cashew nuts for export. With the emergence of cashew markets, Vietnam's cashew farm area increased rapidly from nearly two hundred thousand hectares in 2000 to a peak of four hundred and forty thousand hectares in a little over half a decade. The cashew cultivation area, however, began to diminish in 2008 owing to falling cashew prices and the emergence of other industrial crops such as rubber, cinnamon, coffee, and pepper. In 2016, the area cultivated with cashew nuts was three hundred thousand hectares concentrated mainly in the south-eastern region of Vietnam. The two largest cashew producing regions being Binh Phuoc (44%) and Dong Nai (15%).
In addition to the reduction in cultivated area, fluctuating cashew productivity was and continues to be another concern of the Vietnamese cashew industry. According to Vietnam's Ministry of Agriculture and Rural Development, around 30% of all cashew crops in Vietnam are too old (over 20 years) to achieve the peak productivity. Factors such as climate change and the inexperience of Vietnamese cashew farmers in adopting modern cashew farming techniques, also influence productivity. The overall productivity of cashew nut cultivation, as a result, dropped to 800 kg/ha in 2013 before increasing further to 1.4 ton/ha in 2015.
Binh Phuoc, the center of the Vietnamese cashew industry, covers a hundred and eighty thousand hectares of cashew farms, of which 21.8% is state-owned and administered by forest rangers, while the remainder is made up of smallholdings owned by around eighty thousand farming households in the three districts of Bu Dang, Bu Gia Map and PhuRieng.
Cashew producers comprise farmers from both the Kinh majority and Stieng (who are an ethnic minority in Binh Phuoc). As the average size of a cashew farm is only two and half hectares, it is difficult to use intensive cultivation techniques. Most small-scale farmers don’t consider cashew as an industrial crop but make use of it to serve as shade trees, therefore, only 45% of Binh Phuoc cashew farmers have invested in grafted seedlings, fertilizers, pesticides and machinery, resulting in low productivity. 15% of the cashew trees in Binh Phuoc are old and need to be replaced.
Cashew cultivation in the region of Binh Phuoc was quite successful in 2017 as the region produced close to 200,000 tonnes of raw cashew nuts. This was an estimated drop of nearly 50% from the province's regular production owing to bad weather conditions. Overall, the province represents nearly 60% of the national population harvest of raw cashews. Binh Phuoc has a number of cashew processing companies and household processors. However, only a few processors are able to export cashew kernels while the rest are retained for elementary processing. In 2015, Binh Phuoc accounted for only 14% of Vietnam's total cashew exports.
Despite Binh Phuoc being the leading Vietnam’s leading cashew producing region, the province faces numerous challenges in maintaining its productivity, including -
To solve the problem of the decline in cashew nuts production in Vietnam, the Vietnamese Cashew Association (VINACAS) implemented the following policies -
Along with these national programs, VINACAS is also working with Cambodia and Laos to expand the cashew growing area and increase productivity. In 2017, VINACAS signed an agreement with Cambodia to expand its cashew cultivation area to five hundred thousand hectares in order to produce one million tons of raw cashew.
There are approximately two hundred thousand cashew producing households (40% of which are located in Binh Phuoc). Most farm households operate separately, with family members helping during the harvest season (one to three months). For farms larger than five hectares, farmers can recruit temporary labor (for a few weeks) to help with the harvest. Farm households sell their harvest to small collectors/agents who later sell to larger middlemen/agents. At the end of each day, the biggest agents sell the cashews they have collected to processing facilities. From farms to the processing plant, raw cashews can be marketed by up to seven different collectors and buyers. Due to this arrangement of picking and selling, it is difficult to trace produce down to the farm or district level, except where processors have established a supply contract with farms or cooperatives. Raw cashew prices fluctuate throughout the harvest season, usually the highest at the beginning of the season and from there gradually decreases.
For the 2018 season, for instance, the per kg market price of raw cashew nuts from Vietnam (specifically from Binh Phuoc farms) fell by 60% between the start and end of the season. According to farmers, the fall in prices could be attributed both to the lower quality of cashews harvested towards the end of the season and to pressure from middlemen to lower prices. Processors/exporters have made several attempts to cut out middlemen. Bigger processors such as Olam and Long Son, among others, usually send their purchases teams in agricultural regions to buy directly from farmers. Another initiative is that processors/exporters work with cashew cooperatives which are unified and overseen by the foremost cashew nuts association in Vietnam - VINACAS. Cooperatives often collaborate with exporting processing companies to ensure the full purchase of their cashew nuts. These processing companies also provide necessary support to the cooperatives supplying them with the machinery and educating them on the planting techniques that they need to employ to improve the productivity and quality of the cashew. At present, a few cooperatives in Binh Phuoc province cultivate organic cashews and directly sell their produce to exporting processors. It is only in these cases that processors can trace the products back to the farms.
There are several reasons why Vietnam is a leading cashew producing nation. Every step in the way the cashews are produced, processed and stored before they are shipped for exports to Europe and the US markets is crucial.
For a long time, the production of cashew nuts in Vietnam has taken place under the aegis of the Ministry of Agriculture, which helps regulate the entire cultivation and processing of cashews. Cashew trees over twenty years old primarily make up the three hundred and thirty thousand hectares of cashew cultivation area in Vietnam. Vietnam's cashew harvests are highly dependent on weather conditions, including lighting, rainfall and humidity. The majority of the cashew producing regions in Vietnam experience temperatures between 24 and 28 degrees Celsius. In addition, most of the areas where cashew farmers cultivate this crop are known for receiving nearly 2000 hours of sunlight per year, which is favorable for the growth of high quality cashews.
Cashews are also cultivated in a variety of soil types, especially in sloping land. These types of soils are rich in nutrients, including a high organic dipole as well as perfect drainage. These regions have ideal rainfall throughout the year, but humid areas and salty soils are not preferable. The growing season for cashew nuts in Vietnam lasts from February until May. The harvesting process involves picking the forged kernels and fruits that are ripe. Farmers can harvest these fruits while they are still hanging from the tree or fallen on the ground. During harvesting, the pulp is always extracted and the seed is washed with water. They are then dried in the sun, pre-sorted, packaged and stored in a cool, dry place. The harvesting season for cashew nuts in Vietnam begins almost towards the end of January or the beginning of February, and concludes in late May or early June depending on the weather and planting methods.
Processing cashews is often a tedious process, which involves a series of steps. The initial shell cracking phase is always the most trying, especially when done manually or without a special machine. When farmers make use of tools, they help in lowering production costs, in turn lowering the cost of processing cashews further than it used to be.
Farmers first soak the fruit in the steam which softens the outer layer, then they open it to extract the stone. The kernels are then sun dried, peeled using cashew peeling machines and stored according to specific sizes and qualities. Most kernels may or may not be scorched, whole or in pieces. They can also be free from cashew shell oil, but they are often of high quality.
In the past, Vietnam mainly relied on a special hulling machine to help with cashew processing. China, Italy and India were its go-to sources for these machines. Vietnamese farmers had to spend heavily to build up their cashew processing infrastructure. However, nowadays these machines have even been replaced by upgraded versions of locally designed and manufactured cashew processing mechanisms.
These locally made processing machines proved to be invaluable as they could take care of nearly eight of the nine stages of cashew processing, saving processing time and costs. In particular, these new processing machines cost 40-50% less than the imported version and perhaps most significantly they were designed to reduce the production rate of broken nuts to exceptionally high standards, with only 10% of processed nuts coming out broken.
Along the same lines, many other countries have become fond of the processing machine designed in Vietnam, which is considered to be an innovative technology that has helped to improve the quality of cashews exported to the overseas market. Vietnam, in this capacity, continued to lead the export of cashew nuts and distinguished itself in the manufacture and distribution of specialized machinery, including sizing, metal detection, drying and many other instruments involved in cashew processing.
The varieties of cashews in Vietnam are classified on the basis of the size, color, and breakage of the cashews. They are divided into different categories and identified by symbols that classify them correctly. Additionally, each type of cashew has a specific price based on the size of the cashew (large or small), including its color (clear, yellow, or brown). A cracked nut also has a unique price, while a large nut will cost more than a small nut.
Currently, there are many types of cashew nuts being cultivated in Vietnam, but most of them fall into five main categories. These varieties usually produce clusters of five to ten fruits per tree. The primary color of the fruit is yellow. However, the grain ratio, the size of the raw cashews and the yield are quite different from each other.
Whichever of these cashew varieties you wish to procure for your cashew nuts retail, confectionery or restaurant business needs, you can depend on SCashews to procure them for you. Having been in the cashew nuts import and export game for nearly a decade now, SCashews is recognized as one of the foremost suppliers of Vietnam cashew kernels, for a reason! We ensure our clients get nothing but the most high-grade raw cashew and processed cashew nuts from Vietnam, on time, at the best prices in the market. Reach out to us for more information on the Vietnam cashew nuts varieties we currently have in stock, today!