After almost a decade, the price of old stocks of white arecanut has crossed the Rs 150-a-kg mark. In 1999, the price of old stocks of white arecanut touched a record Rs 170 a kg.
Though private traders have a major share in the market, arrivals and price movements at APMC (Agriculture Produce Marketing Committee) yards in places such as Puttur, Mangalore, Sullia and Bantwal during April-May showed that prices of old stocks and new stocks have been increasing. Growers say that many private traders are approaching them, offering to pay a higher price than what is quoted at APMC yards.
Old stocks of white arecanut, which quoted a maximum of Rs 137 a kg at Puttur APMC of Dakshina Kannada district in April, commanded Rs 155 a kg in May.
Puttur is one of the major white arecanut-growing centres in the region. On June 1, old stocks commanded Rs 157 a kg in this market.
The difference between old and new stocks is between Rs 15 and Rs 20 a kg. New stocks sold at Rs 137 a kg at Puttur APMC yard on June 1.
Stakeholders in arecanut sector attribute the price hike to scarcity of white arecanut in the market in the last three-four years due to various reasons.
Mr Patte Venugopal, a grower from Puttur in Dakshina Kannada district, told Business Line that it is almost a decade since the market reached a peak. The fall after the last peak was led by oversupply in the market.
Labour shortage
With the decline in the price of the commodity in the recent years, farmers did not show much interest in its expansion and cultivation. The shortage in labour and various crop diseases added to the problems of farmers, he said. Added to this, there was a shortage of around 40 per cent in the market last year.
Mr Ramesh Kaintaje, who was a member of the G.V. Joshi panel to fix the production cost of arecanut, said that the commodity has seen two consolidations in the last two months. One was at the level of Rs 115-122 a kg. It lasted for around 15 days. Another consolidation was at Rs 138-142 a kg, and it lasted for over a month. The increase in the price of the commodity was gradual during both the phases.
Asked about the next consolidation level, he said old stocks may test Rs 172-176 a kg level in the coming days.
After taking into account the scarcity of the commodity in the market in the last three-four years, Mr Kaintaje said prices of old stocks may not fall below the Rs 120-a-kg-mark in the coming months.