The industry has suffered a severe blow from the rise in electricity and labor costs.
India’s famous cashew industry in Palasa, Srikakulam district has been hit hard by various factors including the partial lockdown by the Andhra Pradesh government to control COVID-19.
A sharp drop in the demand for nuts and an increase in electricity and labor charges have dealt a severe blow to the industry.
Usually 500 tons of cashew are processed here every day, but in the last few days it has been 200 tons.
“The closings of restaurants and the annulment of marriages caused a sharp drop in the demand for cashew nuts. The industry is already in dire straits due to last year’s lockdown and a drop in exports, ”said Malla Srinivasa Rao, president of the Palasa Cashew Manufacturing Units’ Association The Hindu.
According to him, many manufacturers have been unable to overcome their financial plight since October 2018 when the Titli cyclone wreaked havoc across the Uddhanam region, including the cashew-rich cities of Palasa and Kasibugga.
The total loss caused by Titli is estimated at 120 crore. Successive governments gave assurances that they would work out a package but it was not implemented. Many manufacturers took out bank loans to revitalize their units.
Despite all efforts, the industry has not been able to get back on track in the past three years. An increase in labor costs is also cited as one of the reasons for the increase in production costs.
Currently, manufacturers pay each worker £ 26.50 to process one kg of cashew nuts. The payment is £ 17.25 per kilo if nuts are machine cut. The workers involved in loading and unloading charge £ 9.55 per bag.
The Center of Indian Unions and other unions have called for a strike and called for a wage revision to mitigate the effects of inflation.
By May 16, 6,000 workers, including women, are expected to take part in the strike.
The association is expected to hold a meeting with unions to explain its financial difficulties.
“We always give priority to the welfare of workers. Many manufacturers operate the devices to make a living. The unions should also work with us on implementing the new wage revision package from next year, ”said Rao.