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A.J. Vinayak

Private traders offer better rates to growers

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Mangalore March 1 The Directorate-General of Foreign Trade (DGFT) notification last week allowing the import of arecanut only through the New Mangalore Port seems to have made a positive impact on the domestic white arecanut market. There has been an increase in the prices of both old and new stocks of white arecanut.

Following a request by the arecanut co-operatives from Karnataka, the DGFT — in its notification dated February 20 — had authorised only New Mangalore Port to import arecanut as a measure to curb the import of the commodity.

On Thursday (March 1), the old stocks of white arecanut was quoted at Rs 88 a kg and new stocks at Rs 80 a kg on the trading platform of the South Kanara Agriculturists Cooperative Marketing Society.

Output decline

Prices of white arecanut in other markets are decided based on the price fixed at SKACMS. On February 20, the old stocks quoted a maximum of Rs 81 a kg and the new stocks quoted a maximum of Rs 72 a kg.

The decline in production of white arecanut during this season compared with the previous season has also contributed to the bullish trend in the market. There has been a decline in the yield of white arecanut of around 20 per cent to 25 per cent.

TARGET

The northward movement in the prices of white arecanut has now made growers target Rs 100 a kg for the old stocks. Following this, arrivals are thin in the domestic market. And private traders purchase a majority of those arriving in the market.

Private traders are luring growers by offering them better price than that fixed by co-operatives. A source in one of the major co-operative institutions told Business Line that co-operatives adhere to rules and pay tax to the Government. However, some private traders offer better price to the growers by evading tax. "Some (growers) sell the commodity to private traders when the prices are good, and remember co-operative institutions when the prices crash," a source said.

Factors such as releasing the commodity at regular intervals to the market and selling a considerable quantity in the co-operative sector would help maintain stability in the market, they said.

Sources in the Central Arecanut and Cocoa Marketing and Processing Co-operative (Campco) Ltd said that 300 containers of imported arecanut (nearly 5,000 tonnes) were languishing in various ports of the country. The market would be affected badly if these stocks were allowed to flood the market, they said.

Nodal agency

In such a situation, it is essential for the Government to appoint a nodal agency to check the quality of imported arecanut and fix a tariff price for imported arecanut, they added.

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