Growth, instability and decomposition analysis of cashew nut production in India and Kerala

Abstract

Cashew tree (Anacardium occidentale) is an evergreen tropical tree originated in Eastern Brazil. India is the second largest producer, exporter and largest consumer of cashew nuts in the world. Cashew cultivation is primarilyconcentrated in the peninsular regions of India, including Kerala, Karnataka, Goa, and Maharashtra. This study analyses thegrowth, instability and decomposition of cashew nut production in India and Kerala over the last two decades. The analysisutilizes secondary data on area, production and productivity from 2004 to 2023, with a focus on two sub-periods: 20042013 and 2014-2023. Compound Annual Growth Rate (CAGR) and Cuddy-Della Valle Instability Index (CDVI) were employed to assess the growth and variability. Decomposition analysis was used to evaluate the relative contributions ofharvested area and productivity to cashew production.The results indicated that in India, the area under cashew cultivationgrew steadily in both periods with growth rates of 2.62 per cent and 2.14 per cent in period-I and period-II respectively, butgrowth in production (0.37%) slowed in the second period due to declining productivity (-1.73%). The primary driver ofcashew production growth in India was area expansion, while declining productivity had a negative impact, particularly inthe second period. In Kerala, the findings were similar, with area expansion contributing positively to production, butproductivity declines offsetting these gains. The study concludes that increasing cashew production in India relies heavilyon expanding the cultivated area, but addressing productivity challenges is crucial for sustainable growth.