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The wholesale price of coconut oil on Monday touched Rs 15,000 a quintal, thanks to acute shortage of the coconut and copra. This triggered panic in the coconut oil market. Market sources expect further rise in prices of coconut, copra and coconut oil. In local markets, the average price of coconut increased to Rs 20 a piece. Extreme summer heat has also pushed demand for the tender coconut and this in turn has affected copra production in Kerala and Tamil Nadu.
The tender coconut is now being sold at Rs 30 a piece. In the retail market, coconut oil rose to Rs 165 a kg on Monday.
According to experts, the price of coconut oil has more than doubled in one year, as the price during April last year was Rs 6,300 a quintal. The price of copra on Monday was Rs 10,300 a quintal. Last year, the price of copra was Rs 4,425 a quintal.
Thalath Muhamed, former president, Cochin Oil Merchants Association, said shortage of copra and coconut in Kerala and Tamil Nadu had caused steep rise in their prices in the last three-four months. He said while Kerala saw a 50 per cent fall in coconut production, there was a 40 per cent drop in Tamil Nadu. The Kochi market quoted a record price of Rs 12,200 a quintal of coconut in February. Prices of coconut oil rose Rs 1,100 for a quintal, while copra’s price has gone up by Rs 900 a quintal in just one week. However, there will be easing in prices of coconut and oil by next month, once the production season begins in Tamil Nadu, the largest coconut oil producer in the country.
According to Thalath, supply crunch is serious in all major producing centers of Kerala since coconut production is too low and shortage for climbers is a big issue. Besides, a major chunk of the produce is getting damaged in plantations.
The production during winter season was very low this time, hence the present supply crunch, said C D Joseph, a farmer. During December–January, the coconut production was down 50 per cent in major centers in Malabar, he added. He said the production in the northern Malabar region would pick up by next month, but the market is likely to soften when Tamil Nadu suppliers become active. He said there was good demand in the market, especially from the industrial users and from overseas markets like West Asia.
Meanwhile, demand for palm oil has increased during the last one month, as the price is comparatively low, now. In wholesale trade, palm oil now quotes Rs 6,700-6,800 a quintal. So demand has picked up heavily during the last one month.
T D Reejan, a trader, told Business Standard there was an obvious shift in demand in favour of palm oil in the market, especially from household consumers and local banana chips producers. He said palm oil price would also move up in tandem with the coconut oil price.
