The Hindu Business Line : White arecanut prices on the rise<br>Lack of quality areca, curbs on imports cited as reasons

HAPPY TIMES ARE HERE AGAIN: A worker grading arecanut at Kokalai in Thrissur. Commonly used as a masticatory and as an ingredient in betel nut quid, it is mainly cultivated in the southern states and this accounts for 90 per cent of the production in the country. The total acreage under cultivation is around 3.13 lakh hectares producing 3.79 lakh tonnes. New supari prices ruled between Rs 6,000 and Rs 8,378 a quintal on Tuesday. — K.K. Mustafah

Mangalore , Oct. 25

THE smile is back on the face of arecanut growers after a gap of five years. The price of white variety of arecanut - which is predominantly grown along coastal Karnataka and some parts of Kerala — is increasing steadily in the market. The arecanut market, which crashed in 2000, has been recovering this year.

The white variety of arecanut has seen an average increase of Rs 20 a kg in the last 15 days. On Tuesday, white variety of arecanut was sold at Rs 83 a kg in the Mangalore market.

Mr M. Srinivas Achar, President of the All-India Areca Growers' Federation, told Business Line here on Tuesday that lack of quality arecanut in the market is one of the reasons for the increase in price.

Nearly 90 per cent of the growers of the white variety are small and medium farmers. Most of them sell the commodity by the end of June to meet their monetary requirements. Following this, many of the small and medium farmers have not got the benefit of price hike, he said.

The remaining growers — who own large holdings of arecanut plantations — wait for the price to increase. In such a case, there will not be flow of arecanut in the market.

Sources in Central Arecanut and Cocoa Marketing and Processing Cooperative (Campco) said all the old stocks of arecanut have been cleared in the market. (In the case of white variety, old stock gets good price compared to the new stock.) According to them, this year there is a good demand for Campco's arecanut in Uttar Pradesh and Bihar markets.

They attributed the Government's action in curbing the `illegal' import of arecanut as another reason for the price hike.

Mr Sridhar G. Bhide, President of Mangalore Agriculturists' Souharda Sahakari (MASS), said that big farmers, who constitute 10 per cent of total arecanut growers, should release their stock to the market. This will curb the entry of poor quality `imported' arecanut to the market.

Asked about the sustainability of the present market movement, Mr Achar said, "Market will be steady for another 18 months."

The market witnessed a crash in 2000 with the prices of white variety of arecanut reaching Rs 40 a kg, which is below the cost of production.

The average cost of production of white variety of arecanut is Rs 65 a kg. However, the prices went up to Rs 175 a kg during 1999.

Mr Achar said that it is the longest recovery period for white variety of arecanut in the country. Even though the price of white arecanut crashed several times in the last few decades, it recovered within 12 to 18 months, he added.

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