Cashew Production and Trade: India’s Role in the Global Market

India’s relationship with cashew nuts is both ancient and deeply economic. Introduced by the Portuguese in the 16th century, cashew (Anacardium occidentale L.) arrived in Goa and gradually spread along the country’s coastlines. What began as a tool for preventing soil erosion eventually transformed into one of India’s most valuable export commodities. Today, the cashew industry is at the heart of livelihoods, foreign exchange earnings, and complex global trade dynamics – making it a crop worth understanding in detail.

India’s standing in global cashew production 🔗

India is among the world’s top cashew producers, but its position in the global market is more nuanced than simple volume rankings suggest. According to the India Brand Equity Foundation (IBEF), the country produces over 0.8 million metric tonnes of cashews annually across approximately 0.7 million hectares of agricultural land. In terms of raw cashew nut (RCN) output, India contributed around 17.8% of global production, making it one of six countries that collectively supply nearly two-thirds of the world’s cashew supply, alongside Côte d’Ivoire, Vietnam, Burundi, the Philippines, and Tanzania.

Where India truly distinguishes itself is in processing. According to the International Nut and Dried Fruit Council (INC), India accounted for 36.5% of the global cashew processing share as of 2024 – far exceeding its share of raw nut production. This makes the country the world’s dominant processing hub, converting raw nuts sourced both domestically and from African nations into finished cashew kernels for global consumption.

Major cashew-producing states 🔗

Cashew cultivation in India is largely a coastal phenomenon. The crop thrives in the humid, tropical conditions along both the west and east coasts. The main producing states – Maharashtra, Kerala, Karnataka, Andhra Pradesh, Odisha, and Tamil Nadu – together account for more than 85% of the national output.

Maharashtra: the production leader 🔗

Maharashtra leads all states in raw cashew nut production, accounting for approximately 25% of the national total. The Konkan belt, especially the districts of Ratnagiri and Sindhudurg, hosts large cashew plantations well integrated with processing and export facilities. The state benefits from integrated clusters where farms and processing hubs are in close proximity, reducing spoilage and transit costs.

Kerala: the processing powerhouse 🔗

While Kerala has slipped in production rankings – currently ranking sixth in area and fifth in output – it remains the undisputed centre of cashew processing in India. About 800 registered cashew processing units operate in Kerala, employing around 3 lakh workers, of whom 95% are women. The Kollam district, often called the “Cashew Capital of the World,” has been the nerve centre of this industry since the 1920s. At its peak, 80% of India’s export-quality cashew kernels were processed in Kollam alone.

However, the state’s cashew industry is currently navigating a serious structural crisis. Kerala produces only around 83,000 MT of raw cashew nuts against a processing demand of 600,000 MT, forcing it to import large quantities of raw material – primarily from African countries like Ivory Coast, Ghana, and Tanzania. Rising input costs, a shortage of affordable raw nuts, and competition from lower-cost processors in other Indian states and Southeast Asia have forced many factories to shut down, directly threatening the livelihoods of thousands of women workers.

The productivity challenge 🔗

Here lies one of the most critical structural weaknesses of Indian cashew farming. India’s current area under cashew cultivation stands at approximately 11.83 lakh hectares, yet raw nut productivity averages only around 760 kg per hectare – well below the levels achieved by leading producing countries.

Vietnam achieves roughly 1,300 kg per hectare, while India’s productivity remains in the 700-800 kg per hectare range – and some industry sources suggest it is even lower in traditional growing areas. Countries like Cambodia and Vietnam are reported to achieve yields of around 2 tonnes per hectare in their best-managed plantations.

Several factors contribute to this gap. Many Indian cashew orchards are old, with senile trees that have declining yields. The dominance of traditional farming methods, limited adoption of high-yielding varieties, fragmented landholdings, and erratic weather – particularly unseasonal rainfall between November and January – all weigh on productivity. According to the Directorate of Cashew Research, even though total area and production have grown over time, per-hectare productivity has actually declined in recent years, compounded by climate-induced stress and increasing pest pressure such as the tea mosquito bug.

To counter this, the Government of India, through the Mission for Integrated Development of Horticulture (MIDH) and the Rashtriya Krishi Vikas Yojana (RKVY), has initiated programmes for area expansion and replacement of senile cashew plantations with high-yielding varieties across both traditional and non-traditional states. A roadmap for extending cashew cultivation by an additional 1.20 lakh hectares has also been approved.

India as a cashew processing and export hub 🔗

Despite the productivity gap in farming, India has built a formidable position in the cashew value chain through processing. The country imports large volumes of raw cashew nuts – primarily from West Africa – processes them, and exports high-quality kernels to global markets. Importing raw cashew nuts has played a key role in sustaining the Indian cashew processing industry, meeting almost half of the domestic and export demand for cashew kernels.

In FY 2024-25, India’s total cashew exports stood at US$ 337.14 million, with export volumes rising from 76,824 MT in FY23 to 79,030 MT in FY24. The country exports cashews to over 60 countries worldwide. Major export destinations for 2024-25 include the UAE, Vietnam, Japan, the Netherlands, and Saudi Arabia. The UAE has historically been India’s single largest buyer of cashew kernels.

India’s main export product is the shelled cashew kernel. Shelled kernels commanded approximately 93.68% of the India cashew market share in 2025, reflecting the country’s deep expertise in processing and grading. Apart from kernels, India also exports Cashew Nut Shell Liquid (CNSL) and its refined derivative, cardanol, which have significant industrial applications including in coatings, resins, and brake linings.

Competition from Vietnam and Africa 🔗

India’s position in global cashew trade is under sustained pressure from two directions: Vietnam and an increasingly self-processing Africa. Vietnam exported over 730,000 tonnes of processed cashews in 2024, earning a record $4.37 billion – a performance enabled by the country’s highly mechanized processing sector, which handles over 80% of global cashew supply.

India, by contrast, remains heavily reliant on manual labour. Over 82% of Indian cashew processing units are manual-processing units, compared to 40% in Vietnam and 25% in Brazil. This creates a cost disadvantage that is difficult to offset. Simultaneously, African countries – which supply the bulk of raw cashew nuts to Indian processors – are now processing more of their harvest domestically, tightening the availability of raw material imports that Indian factories depend on.

For Indian processors, the lack of modern automation limits scalability and operational efficiency, making it harder to compete on cost with technologically advanced competitors. Addressing this requires significant investment in mechanization – but doing so without displacing the large workforce that depends on manual processing is a delicate challenge for policymakers.

Employment and the role of women 🔗

Beyond its export numbers, the cashew industry carries profound social significance. The Directorate of Cashew Nut and Cocoa Development (DCCD) estimates that around 15 lakh people are employed across cashew farming and processing in India. What makes this particularly significant is who those workers are: the industry is one of India’s largest employers of women in manufacturing.

Around 94% of industrial cashew workers are women, many of them from economically and socially disadvantaged backgrounds. In Kerala’s Kollam district alone, approximately 2.5 lakh women are directly employed in cashew processing. In Karnataka’s coastal processing clusters, women account for 90% of the workforce in cashew processing units.

This makes the industry not just an economic enterprise but a critical safety net for rural women’s livelihoods. Any disruption – whether from factory closures, raw material shortages, or increased mechanization – directly impacts these women’s income and economic independence. The Kerala government’s Budget 2024-25 allocations for the cashew sector directed about 90% of outlay toward benefiting women workers, reflecting the industry’s critical social dimension.

Government support and institutional framework 🔗

India has a well-developed institutional structure supporting the cashew sector. The Directorate of Cashew Nut and Cocoa Development (DCCD) in Kochi oversees cultivation expansion and productivity improvement. The Cashew Export Promotion Council of India (CEPCI), established in 1955, promotes India’s cashew exports globally, organizes buyer-seller meets, and facilitates participation in international trade fairs under the Market Access Initiative (MAI) scheme.

On the taxation front, the Basic Customs Duty on raw cashew nuts was reduced to 2.5% from 5% in 2018, and the GST on raw cashew nuts was simultaneously reduced from 12% to 5%, easing the cost of imported raw material for processors. The Kerala State Cashew Development Corporation (KSCDC) is working to source raw cashew from African countries to sustain processing capacity, while the Kerala State Agency for the Expansion of Cashew Cultivation (KSACC) promotes domestic cultivation of high-yielding varieties.

Opportunities ahead 🔗

The India cashew market was valued at approximately US$ 2.28 billion in 2024 and is projected to reach US$ 3.31 billion by 2033, growing at a CAGR of around 4.25%. Several trends are driving this growth – rising health consciousness, growing urban demand for premium snacks, and the global expansion of plant-based food products, for which cashew is a key ingredient in items like cashew butter and cashew milk.

There is also significant room to improve farm-level productivity through the adoption of improved, disease-resistant varieties, better orchard management, and expanded irrigation. Greater mechanization of processing – done thoughtfully to preserve employment – can help Indian processors become more cost-competitive globally. And as India expands value-added products beyond plain kernels into flavored cashews, cashew-based snacks, and industrial CNSL derivatives, it has the potential to capture more value from each tonne it produces.

India’s cashew story is ultimately about balancing scale with quality, tradition with modernization, and global competitiveness with local livelihoods. It is a crop that feeds foreign exchange reserves, sustains millions of rural families, and carries the weight of decades of agricultural and industrial heritage.

What do you think? Given that India’s cashew processing sector depends heavily on imported raw nuts from Africa, how should it prepare for a future where African countries process more of their own harvest domestically? And with over 90% of cashew workers being women, what role should mechanization play – and what safeguards must accompany it?

References

1. https://apeda.gov.in/cashew
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5. https://keralacashewboard.com/cashew-industry/
6. https://www.industry.kerala.gov.in/images/pdf/odop/product-desc/ODOP_PRODUCT_DESCRIPTION-KOLLAM.pdf
7. https://en.wikipedia.org/wiki/Cashew_business_in_Kollam
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