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The copra and coconut oil markets have registered a slight increase in prices, thanks to recent monsoon showers. Further northward movement is likely, as there is good demand for both, but not indefinitely, say leading traders, as there is enough supply, especially from the Tamilnadu.
The oil price is now Rs 6,200-6,400 a quintal, while copra is readily available at Rs 4,500-4,600/qtl.
Traders told Business Standard the failure of government agencies in procurement had badly affected the market. According to sources, hundreds of tonnes of copra had been damaged in Lakshadweep due to absence of timely intervention of state agencies such as Nafed. Growers and traders say in previous years, too, it has been usual for procurement in general to commence too late.
A sharp increase in the import of palm oil and palm kernel oil has also hit the coconut oil market. Thalath Mehamood, president, Cochin Oil Merchants Association, told Business Standard that the lower priced palm oil and palm kernel oil are good options for industrial users, many of whom preferring it. Palm kernel oil is priced at Rs 5,400 a qtl and there has been a lot of recent import. Refined palm oil is also available in plenty and demand is high from hoteliers and bakeries.
Mehamood said production of coconut and copra had risen this year, especially in Tamil Nadu. The oil is also cheaper there than in Kerala, currently Rs 6150/qtl. Rain has upset the drying of copra in Kerala but Tamil Nadu has a decent stock of both copra and oil. There might be a slight increase due to rain but the price is otehrwise likely move in a range of Rs 6,00-6,500 a qtl.
Export of coconut oil is dull as the Indian price is higher than those of competing nations. Our quality is also considered inferior, especially in the bulk business. The global coconut oil market is dominated by Philippines, Sri Lanka and Indonesia; India's part is limited to the branded segment. Philippines and Sri Lanka offer oil at cheaper prices than India's in the Gulf region, the major import market.
Coconut production in Kerala, especially in the northern Malabar region, had increased this year. The concern is labour availability. In Kerala, about a third of production is hit due to a shortage of climbers.
This is severe in the districts of Ernakulam, Thrissur and Alappuzha. Growers told Business Standard they got Rs 400-500 for 100 coconuts, while the daily wage comes to around Rs 600. So, many, especially smaller growers, have abandoned plantations or shifted to other cash crops in recent years.
