A sudden fall in prices of copra and coconut oil has upset traders, mill owners and coconut growers. Contrary to the last season, the price of coconut oil in wholesale trading has fallen to Rs 5,400 a quintal, while copra prices have decreased to Rs 3,500 a quintal. In May last year, price of coconut oil was Rs 10,400 and copra was quoted at Rs 7,000-7,500 a quintal. According to latest indications from retail trade, a coconut now costs around Rs 5, compared with Rs 8-10 a few weeks earlier.
It is a surprise for both growers and traders, as they are unable to understand the reasons behind such a drastic fall in prices. Within just four weeks, the coconut oil price fell Rs 900 a quintal, while copra fell by Rs 950. Such a sharp fall is seen for the first time in the past four years.
According to C V Antony, a leading oil mill owner in central Kerala, growers hinged their hopes on copra procurement by Nafed, but it failed miserably. Now the market is flooded with copra produced in four states — Tamil Nadu, Kerala, Karnataka and Andhra Pradesh. There is actually a glut in the market and the demand is rather weak, compared to the supply.
The procurement of copra has not yet started in most parts of the country and the state-level nodal agencies are not keen on stocking copra. This is a loss-making exercise for most of the agricultural co-operative societies.
A majority of copra was stocked expecting higher prices through the price support scheme, but in vain. Now, this stock is being released to the open market and the supply is at its peak. This is a major factor behind such a strong bear phase in the market, said experts.