Sri Lanka’s ambitions to transform cashew into a major cash crop for both domestic use and export markets are facing severe challenges, with industry stakeholders blaming bureaucratic hurdles, policy ambiguities, and weak production for stunting growth.
Cashew has long been a household favorite among Sri Lankans and is increasingly popular with foreign tourists, especially in hotels and resorts where it is served as a premium snack. With tourist arrivals on the rise in 2025, demand for cashew has surged.
However, the country’s annual output remains far below requirements. Officials at the Ministry of Plantation Industries confirmed that current production stands at just 12,500 tonnes, falling well short of national demand, which is estimated at nearly double that figure.
To bridge this gap, the previous government introduced a controlled cashew importation system that allowed imports only between December and April, the off-season for domestic harvests. A multi-ministerial committee monitored this window to protect local farmers.
Yet industry insiders now warn that the mechanism has collapsed, leaving a vacuum in policy and creating uncertainty for both producers and importers.
The situation has been further complicated by the introduction of the National Imports Tariff Guide 2025 (NITG-2025), which restructured Harmonised System (HS) codes and taxes.
Traders complain that the new framework has made import procedures cumbersome, resulting in shipment delays, order cancellations, and rising costs. Each permit now carries only a three-month validity, making them ineffective if approvals are delayed a common occurrence under the new system.
In addition, exporters point to new requirements such as foreign laboratory certification and extended customs verification processes, which they say have crippled efficiency. “By the time approvals are completed, the market demand has shifted, and shipments are either lost or arrive too late,” one exporter lamented.
The Sri Lanka Cashew Corporation (SLCC), which oversees balancing imports with domestic supply, faces its own hurdles. Sudden weather swings often reduce yields, forcing reliance on imports. However, approval bottlenecks prevent timely replenishment of stocks, leading to shortages and price spikes in the local market.
Beyond regulatory snags, the industry struggles with outdated processing facilities, low levels of mechanisation, and limited investment in modern farming techniques. Neighboring countries like India and Vietnam have developed cashew into billion-dollar export earners through mechanised processing, contract farming, and aggressive marketing areas where Sri Lanka lags significantly.
Analysts warn that unless swift reforms are made such as digitising import approvals, streamlining customs checks, and supporting farmers with improved technology—the industry could lose its potential to become a valuable export earner.
For now, the cashew sector remains trapped between growing demand and systemic inefficiencies, a situation that risks turning a promising crop into a bitter harvest
