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Stop Cashew Smugglers, Traders Urge Govt

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Nigeria to expand Cashew Nut export by 2020
  • Stop Cashew Smugglers, Traders Urge Govt

The National Cashew Association of Nigeria (NCAN) has raised the alarm over the invasion of the cashew nuts business. It urged the Federal Government to stop smugglers of the product for the traders’ sake.

The group said some unscrupulous businessmen had been depriving the country of huge revenue, urging the government to curb the trend.

According to NCAN, smugglers were making cashew nuts business difficult for traders.

Investigation revealed that over 50 per cent of cashew nuts produced in the country were being smuggled through Kwara, Oyo and Ogun states to Benin, Ghana and Mali, from where the nuts are exported to India and Vietnam.

A member of the group, Mr Ajayi Emmanuel, said Benin Republic, Ghana, Gabon and Cote d’Ivoire had become major markets where the crop fetches a premium in the international market for smugglers.

He alleged that the merchants receiving the smuggled commodity were branding Nigerian cashew as their own farm product, saying the illegal trend had weakened the nation’s export.

“Based on the activities of smugglers, the country lacks adequate tonnage of cashew going out through the land borders and because of the illegal trade, Nigeria has been losing huge sums of revenue.There is high concentration of smuggling of the product at the porous borders in Ogun, Oyo and Kwara states.

“The volume of the smuggled product is larger than those passing through the seaports legitimately,” he said.

He noted that this had affected the price structure of the commodity in the country.

He urged the government to intervene and block all the loopholes.

The exporter said the Federal Government should ban the smuggling of the product and asked the NCS and the NIS to enforce the law to create jobs for the youths.

Emmanuel explained that the neighbouring countries were earning the revenue from the product, which is supposed to come to Nigeria.

“The government should rise up and improve on the country’s border control. If there is proper control at the borders, the country would have proper data of the tonnage produced yearly, but right now, it is difficult to know the volume of cashew produced in the country,” he said.

Emmanuel said NCAN had its own taskforce to assist Customs and immigration in enforcing the law.

He recalled that in 2015, the country earned $253 million from 160,000 tonnes and, last year, cashew generated about $280 million to the economy.

Nigeria has capacity to produce 160,000 tonnes of cashew valued at N115.2 billion ($320 million).

Findings revealed that Vietnamese traders are interested Nigerian cashew nuts because they are of the highest quality in the West African.

But, there are indications that the country may only be able to supply more than 40 per cent of the total demand due to low capacity.

The price of the nuts has increased from $1,850 per ton to $2,000 since the beginning of the year.

The nuts are being demanded for the production of anti-bacterial preparations, varnishes, insecticides and car brake pads.

According to Vietnam Cashew Association (VCA), the global output dropped from three million tons to 1.5 million tons.

The association said at the moment, about two-third of the nuts in Vietnam’s cashew industry were imported.

A member of the association, Mr. Nguyen Duc Thanh, said: “The domestic cashew supply was not sufficient for processing needs in the first half of 2017, so the industry had to import from Nigeria and other West African countries.”

He noted that cashew processors were complaining that imported nuts were expensive, while the processed product prices remained unchanged, leading to low profit for them.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Crude Oil

Oil Dips Below $62 in New York Though Banks Say Rally Can Extend

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Oil

Oil Dips Below $62 in New York Though Banks Say Rally Can Extend

Oil retreated from an earlier rally with investment banks and traders predicting the market can go significantly higher in the months to come.

Futures in New York pared much of an earlier increase to $63 a barrel as the dollar climbed and equities slipped. Bank of America said prices could reach $70 at some point this year, while Socar Trading SA sees global benchmark Brent hitting $80 a barrel before the end of the year as the glut of inventories built up during the Covid-19 pandemic is drained by the summer.

The loss of oil output after the big freeze in the U.S. should help the market firm as much of the world emerges from lockdowns, according to Trafigura Group. Inventory data due later Tuesday from the American Petroleum Institute and more from the Energy Department on Wednesday will shed more light on how the Texas freeze disrupted U.S. oil supply last week.

Oil has surged this year after Saudi Arabia pledged to unilaterally cut 1 million barrels a day in February and March, with Goldman Sachs Group Inc. predicting the rally will accelerate as demand outpaces global supply. Russia and Riyadh, however, will next week once again head into an OPEC+ meeting with differing opinions about adding more crude to the market.

“The freeze in the U.S. has proved supportive as production was cut,” said Hans van Cleef, senior energy economist at ABN Amro. “We still expect that Russia will push for a significant rise in production,” which could soon weigh on prices, he said.

PRICES

  • West Texas Intermediate for April fell 27 cents to $61.43 a barrel at 9:20 a.m. New York time
  • Brent for April settlement fell 8 cents to $65.16

Brent’s prompt timespread firmed in a bullish backwardation structure to the widest in more than a year. The gap rose above $1 a barrel on Tuesday before easing to 87 cents. That compares with 25 cents at the start of the month.

JPMorgan Chase & Co. and oil trader Vitol Group shot down talk of a new oil supercycle, though they said a lack of supply response will keep prices for crude prices firm in the short term.

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Crude Oil

Oil Prices Rise With Storm-hit U.S. Output Set for Slow Return

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Crude oil

Oil Prices Rise With Storm-hit U.S. Output Set for Slow Return

Oil prices rose on Monday as the slow return of U.S. crude output cut by frigid conditions served as a reminder of the tight supply situation, just as demand recovers from the depths of the COVID-19 pandemic.

Brent crude was up $1.38, or 2.2%, at $64.29 per barrel. West Texas Intermediate gained $1.38, or 2.33%, to trade at $60.62 per barrel.

Abnormally cold weather in Texas and the Plains states forced the shutdown of up to 4 million barrels per day (bpd) of crude production along with 21 billion cubic feet of natural gas output, analysts estimated.

Shale oil producers in the region could take at least two weeks to restart the more than 2 million barrels per day (bpd) of crude output affected, sources said, as frozen pipes and power supply interruptions slow their recovery.

“With three-quarters of fracking crews standing down, the likelihood of a fast resumption is low,” ANZ Research said in a note.

For the first time since November, U.S. drilling companies cut the number of oil rigs operating due to the cold and snow enveloping Texas, New Mexico and other energy-producing centres.

OPEC+ oil producers are set to meet on March 4, with sources saying the group is likely to ease curbs on supply after April given a recovery in prices, although any increase in output will likely be modest given lingering uncertainty over the pandemic.

“Saudi Arabia is eager to pursue yet higher prices in order to cover its social break-even expenses at around $80 a barrel while Russia is strongly focused on unwinding current cuts and getting back to normal production,” said SEB chief commodity analyst Bjarne Schieldrop.

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Crude Oil

Crude Oil Rose Above $65 Per Barrel as US Production Drop Due to Texas Weather

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oil

Crude Oil Rose Above $65 Per Barrel as US Production Drop Due to Texas Weather

Oil prices rose to $65.47 per barrel on Thursday as crude oil production dropped in the US due to frigid Texas weather.

The unusual weather has left millions in the dark and forced oil producers to shut down production. According to reports, at least the winter blast has claimed 24 lives.

Brent crude oil gained $2 to $65.47 on Thursday morning before pulling back to $64.62 per barrel around 11:00 am Nigerian time.

U.S. West Texas Intermediate (WTI) crude rose 2.3 percent to settle at $61.74 per barrel.

“This has just sent us to the next level,” said Bob Yawger, director of energy futures at Mizuho in New York. “Crude oil WTI will probably max out somewhere pretty close to $65.65, refinery utilization rate will probably slide to somewhere around 76%,” Yawger said.

However, the report that Saudi Arabia plans to increase production in the coming months weighed on crude oil as it can be seen in the chart below.

Prince Abdulaziz bin Salman, Saudi Arabian Energy Minister, warned that it was too early to declare victory against the COVID-19 virus and that oil producers must remain “extremely cautious”.

“We are in a much better place than we were a year ago, but I must warn, once again, against complacency. The uncertainty is very high, and we have to be extremely cautious,” he told an energy industry event.

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