Arecanut farmers have asked the central government to extend the market intervention scheme (MIS), currently offered to growers in Karnataka till December 31 this year, up to May 2017. Farmers also want the scheme to be extended to growers in Kerala, said S R Satishchandra, president, Central Arecanut and Cocoa Marketing and Processing Cooperative (Campco).
The central government had last week announced it would procure white arecanut at a Rs 251 a kg and the red variety Rs 270 a kg from Karnataka, under MIS, in a bid to help farmers reeling under price crash. In the past two years, arecanut prices have come down from Rs 75,000 to roughly Rs 25,000 a quintal now.
MIS is a price support mechanism implemented on the request of state governments for procurement of perishable and horticultural commodities in the event of a fall in market prices. The total demand of the crop in India is estimated at around 1.2 million tonnes, while production is pegged at 703,000 tonnes.
While there are 14 states producing arecanut, around 50 per cent of the arecanut production is in Karnataka.
Growers are attributing the price drop mainly to imports. Most traders import the crop from Indonesia – through Sri Lanka – by getting ‘certificate of origin’ from Sri Lanka by value addition and processing. Imports from Sri Lanka to India attract zero per cent customs duty under the India-Sri Lanka free trade agreement. India had imported 67,824 tonnes of arecanut worth $159 million in 2015-16 against 110,000 tonnes worth $229.96 million in 2014-15.
