NEW ISSUES OF CASHEW MARKET IN TAMILNADU (INDIA): OPERATING COSTS

OPERATING COSTS

We are making the distinction between the variable costs and the fixed costs. The variable costs are proportional to the quantity of nuts processed when the fixed cost are independent of this quantity. All costs are depending on the efficiency of the process (quantity of nuts processed per unit of time).
The variable costs can be estimated about CFA 100 – 150 / kg of raw nuts. They are shared between wages (70 % – 80 %), packing materials (10 % -20 %) and others inputs and utilities (5 % – 15 %) but without all financial costs.
The fixed costs are about CFA 25 – 75 / kg of raw nuts without depreciation costs and all taxes.
The total costs are about CFA 125 – 225 / kg of raw nuts processed and an objective for a new operating large size processing unit could be CFA 175 / kg of nuts.

CONCLUSIONS

• The small size farms were more cost efficient and productive than the large farms. Hence, the farmers are advised to go in for small size plantations.
• Investment in cashew plantations was found to be economically possible and financial sound in the state. Hence, the farmers are encouraged to take up the cultivation of this crop in large areas of wasteland.
• Annually 40 and 2.9 lakh tonnes of cashew apples are estimated to go waste in India. Hence, effective methods for economic use of cashew apples in the preparation of alcohol need to be explored.
• The producer’s share in the processor’s rupee was more when sold the produce/ raw nuts directly to processing units, than in any other channels. Hence, the farmers should be encouraged to sell through processors.
• Particularly in the state of Tamilnadu, the growth in area, production and productivity showed on the way out trend during post-liberalisation and overall periods. Hence, concerted efforts should be made to improve productivity by replacing age-old plants.
• There is a need for yield and area stabilizing policies through appropriate Crop Insurance Scheme for cashew. In order to protect the cashewnut producers from high fluctuations.