The Hindu Business Line : White arecanut prices begin to fall

Changing trend New stocks are quoting Rs 70-75 a kg compared with Rs 84-92 on April 3. The fall has led to farmers release their stocks in large numbers. A section of the growers sees the trend as correction.

Mangalore , May 2

White arecanut prices, which touched the magical figure of Rs 100 a kg a month ago, have begun to decline.

Though traders term it as a correction in the market, growers are worried about the development.

Following this, huge quantities are arriving in the market.

No sale of old stocks

On April 3, traders quoted Rs 82-100 a kg for different grades of old stocks of white arecanut on the trading platform at South Kanara Agriculturists Co-operative Marketing Society (SKACMS) Ltd in Mangalore. On that day, new stocks commanded Rs 84-92 a kg.

However, on Tuesday (May 2) new stocks quoted Rs 70-75 a kg at SKACMS trading platform. There was no sale of old stocks on Tuesday.

Sources in the cooperative sector attribute this trend to the arrival of the yields of last crop of white arecanut to the market. "Usually growers do not get quality yields from the last crop of white arecanut, which are harvested in April. As a result of this, such yields command a lesser price," said a source in Central Arecanut and Cocoa Marketing and Processing Cooperative (Campco) Ltd.

The growers, who harvest yields from the middle crop (in January), wait till October, as the commodity will come under the old stocks category then.

FEARS OF FURTHER DIP

However, the fear of a further slide in prices has made the growers to release the stocks in large numbers to the market, including that of middle crop. Procurement centres of arecanut cooperatives in major centres of Dakshina Kannada are getting considerable quantities of white arecanut, said a source in Mangalore Agriculturists' Sahakari Sangha Ltd. The situation was not so a month ago.

Market trend

In a bull market, private traders offer a higher price for growers than the one quoted by the cooperatives to procure their stocks.

Private traders prefer to go slow in a bearish market, forcing the growers to divert their stocks to cooperatives. Stability will be ensured in the market, if more and more growers sell their produce to the cooperatives, sources said.

Another rumour in the market is that some of the big private traders, who have invested in gold and share market, do not have enough funds to invest in the arecanut market. This has forced them to stay away from arecanut market, it is said.

But the growers are hopeful about the market. Terming the slide in prices as `correction' in the market, Mr Ramesh K., a grower from Puttur, said the market would recover back in a month's time.

Puttur is a major arecanut-growing centre in Dakshina Kannada district.