Price Hike Shock: India's Dry Fruits Industry Growth May Plunge from 15% to 1-2%
Rising prices and import duties could crash India's dry fruits industry growth from 15% to just 1-2%, warns NDFC(I) President Gunjan Vijay Jain.
India's thriving nuts and dry fruits sector, which has enjoyed a robust annual growth rate of 10-15 per cent over the last five years, is staring at a severe slowdown. According to Gunjan Vijay Jain, President of the Nuts and Dry Fruits Council (India) [NDFC(I)], this growth could crash to a meager 1-2 per cent as skyrocketing prices begin to eat away at consumer demand.
The Price Trap: Why Demand is Cooling
In an exclusive interview with ANI, Gunjan Vijay Jain highlighted that the rapid expansion the industry witnessed—particularly following the COVID-19 pandemic when health-conscious consumers flocked to nutritional superfoods—is now being arrested by inflation. The surge in retail prices is making these health staples less accessible to the average buyer.
The impact is not just felt by the consumers but also by the traders. Limited working capital is making it increasingly difficult for wholesalers to maintain their usual inventory levels. Jain noted that a trader who previously managed to store 10,000 kg of stock might now only be able to afford 7,000 kg due to the sheer cost of the commodities.
The Festive Season Struggle
Despite the price hikes, dry fruits remain a popular choice for gifting during the festive period. However, the cost of these gifts has risen. Gift boxes typically priced between Rs 500 and Rs 1,000 have seen a price increase of 10-20 per cent compared to the previous year, though they remain the most affordable high-value gifting option available.
A Heavy Reliance on Imports
One of the primary vulnerabilities of the Indian dry fruits market is its massive dependence on foreign imports, as domestic production fails to keep pace with demand. The gap is stark across several key products:
- Walnuts: India consumes approximately 90,000 tonnes but produces only about 30,000 tonnes.
- Almonds: Consumption stands at roughly 2.5 to 3 lakh tonnes.
- Cashews: India consumes around 4 lakh tonnes. While it produces 2 lakh tonnes domestically, it must import another 2 lakh tonnes, primarily from Africa, for processing.
The Battle Against High Tariffs
The NDFC(I) has urged the Indian government to intervene by reducing customs duties and import tariffs. Currently, some import duties are as high as 100 per cent, while others sit at 30 per cent. Jain argued that the industry plays a vital role in the economy by importing raw products and processing them within India, which creates employment for lakhs of people.
He recalled that a previous government decision to slash GST from 12 per cent to 5 per cent provided an immediate boost to consumption, suggesting that similar relief in import duties could revive the current slump.
Which Dry Fruits Saw the Biggest Jump?
The price volatility has been most extreme in certain categories:
Pistachios
Pistachios have seen the most dramatic spike, with retail prices jumping from approximately Rs 1,100 per kg last year to nearly Rs 2,000 per kg. This is largely attributed to a production collapse in the US, where output plummeted from 1.6 billion pounds to just 600 million pounds.
Almonds
Almond prices have climbed by 20-25 per cent, moving from around Rs 800 per kg last year to a current range of Rs 1,000-1,100 per kg.
Investing in Health
Despite the economic headwinds, the NDFC(I) continues to promote the 'Grow in India' campaign to bolster domestic production. Jain emphasized that for India's large vegetarian population, nuts and dry fruits are essential sources of plant-based protein, omega-3 fatty acids, fiber, vitamins, and minerals. He urged consumers to view these items not as expensive luxuries, but as a vital investment in their long-term health.