From 780 Units to 80: How Kollam Lost Its Cashew Capital Status | Latest India News
P Omana, 58, proudly displays burn marks on her finger caused by caustic cashew nut sap. Worked as a cashew nut peeler for 35 years, initially she never wore safety gloves as she was expert in extracting the kernel from the hot shell without scratches or breaks using a small wooden hammer.
Her long years of work helped her marry off her two daughters and build a two-room house with a loan from a cooperative bank in Kollam, South Kerala. Her husband, a worker, died when she was 32.
Today, Omana is among an estimated 200,000 cashew workers who have been left jobless over the past four years in Kollam district and surrounding areas. The state of the region’s countless factories is no better.
Unemployed, Omana occasionally frequents his cashew factory which is closed for arrears. she was paid ₹35 to shell one kg of raw cashew nuts and ₹45 to peel the core. An expert in premium almonds, she used to take ₹500 a day during the last days of her job in 2017. Now she works occasionally with a neighborhood self-help group to ₹200 until noon.
The house of the factory owner where Omana worked is already mortgaged for non-payment of loans, and he died two years ago. Her son now lives in a rented house and pleads impotence.
“I have to receive six months’ salary from my company. In red, my owner committed suicide two years ago,” says another peeler K Vijaya (48) from Paripally.
The finding is the same for more than 80% of these workers, who belong to socially and economically weaker strata.
Cashew factory owners often blame high wages and militant unionism for their plight, but a close look at the industry shows that workers and employers are in dire straits. Unable to bear huge losses and mortgages, six cashew factory owners have committed suicide in the past two years, according to industry insiders.
Attracted by the high value and quick returns, many jumped into the fray. But now only the pioneers and the entrenched remain afloat, while others have collapsed or taken other pastures.
The southern port city of Kerala Kollam was once known as the cashew capital of the world for many years. Its exporters once decided the world price of nuts. The district has produced well known business tycoons like the late Rajan Pillai (Britannia), K Ravindran Nair aka Achani Ravi, K Parameswaran Pillai and Thangal Kunju Musliar.
Kollam’s cashew industry, once the biggest source of foreign exchange (forex) after basmati rice, is now a shadow of its former self. In the past, over 780 licensed cashew factories operated, which has now fallen to less than 80. In the 1980s and 1990s, cashew nut exports peaked at 125,000 metric tons, which declined to less than 20,000 million tons. According to the elders, once you enter the city, the burning smell of cashew shells wafts through the air. Today, old planks, rickety factories, dark smokestacks and helpless workers bear witness to his downfall.
The reasons are many, say industry insiders.
“Slow mechanization, little agriculture, militant unionism, excessive government interference, protectionism and competition from other countries have broken the backbone of the industry,” the man said. third generation cashew nut business owner Pratap R Nair, owner of Vijayalakshmi Cashews Limited (VLC) with a turnover of ₹450 crores. The company was a leading brand in the country.
In its heyday, the country imported raw cashew nuts from Vietnam and other Southeast Asian countries on a large scale and by process. Export agents from Vietnam who came here quickly learned the ropes and introduced it there in the 1980s, accelerating the port city. As the industry collapsed, a high import duty of 9.3% on raw cashew nuts in 2006 shook it further, although it was reduced to 2.5% two years later .
“Cashew farming in Kerala also got exhausted when people turned to rubber farming and other quick crops. After the Gulf boom, there was intense pressure on land to make homes. Farmland used to be a status symbol in the state, but now it’s grand mansions. Although cashew does not need excess fertilizer or care, its cultivation has slowed down,” said P Sundaran, Chairman of Indian Cashew Export Promotion Council and Managing Director of Sreelakshmi Cashew Enterprises , a company with a ₹Turnover of 100 crores.
HISTORY OF CASHEW IN KERALA
In India, the cashew nut, originally from Brazil, was introduced by Portuguese explorers five centuries ago. Initially it was introduced in Goa and later extended to the Malabar coast. The tropical and humid climate of the coast contributed to its development. With a thriving port, Arab and Chinese traders soon began to frequent Kollam, trade historians say.
Industry experts say that in the early 20th century, Kollam became the cashew capital of the world, producing the finest quality nuts. Records show that the first cashew processing on a commercial scale was started by Rocha Victoria, a Sri Lankan who emigrated to the city in 1924. Two years later, a Briton WT Anderson established Indian Nut Company Factory, the city’s first export enterprise.
Cashew used to be considered an elite snack, but after the 1990s it became more common among people. Data from the Cashew Export Promotion Council shows that the country overtook the biggest consumer, the United States, five years ago. In 2019, the country consumed 275,000 metric tons against 183,900 US. Its consumption has increased considerably after its extensive use in confectionery, biscuits and savory dishes. In payasam, burfi, and a thickening agent in curries and medicines, cashew is used throughout.
In India, cashew nuts are grown on 1.2 million hectares of land, with a productivity of 706 kg per hectare, according to 2020 government data. Maharashtra, Andhra Pradesh, Orissa, Kerala , Karnataka and West Bengal are among the main producers.
In Kollam, on average, 800,000 tonnes of raw cashew nuts are imported for processing each year, and at least 20% of export-grade kernels come from here – in the past it was over 60 %. As the global demand for cashew nuts increased, India started importing cashew nuts in the 1960s. Between 1995 and 2015, the compound annual growth rate was 3.1%, while the domestic demand rose to 5.3%, according to the Cashew Export Promotion Council of India (CEPCI), and to bridge this gap, the country has started importing from many African and Asian countries.
“We cannot depend on import to run the industry in India as many African countries have started processing cashew locally. We must increase the production of cashew nuts at the national level to get out of this sad situation. Although cashew cultivation requires little care and less manure, it has failed to attract growers, especially in Kerala,” said RK Bhoodes, a cashew expert, who has made extensive studies on the nut and was a former president of CEPCI.
He said the country will need to increase yield from the current 706 kg per ha to over 3000 kg per ha, and this can be done with proper planning, execution and support from all sides. Although the country has developed many high-yielding varieties and replaced senile trees, improved farming techniques are needed for sustainability, he said.
“What happened to coir in Alapuzha is happening to cashew in Kollam. We have failed to change over time. Although it is a labor-intensive sector, with a 90% female workforce, it has never received the attention it needed. The trade unions also played their part in blocking modernization. Kollam needs a cashew revival program from union and state governments. Otherwise, the once mighty industry will fall into oblivion,” said Kollam MP NK Premachandran.
There are 33 different types of nuts, but only 26 are available for purchase, experts said. Nuts are classified according to their size, color and moisture content. W-180 is the best and five to six times more expensive than normal grade W-320, the most popular and widely available grade. The cracked nut market is also in demand for the bakery and savory industries. Cashew nut oil is widely used in the paint and adhesive industries.