Agri Business

Areca prices remain firm in 2020 despite lockdown

AJ Vinayak Mangaluru | Updated on December 29, 2020

The Covid-induced lockdown in 2020 seems to have helped the arecanut sector in getting a good price for the commodity at a time when the crop production was less compared to the previous year.

Mahesh Puchhappady, General Secretary of the All India Areca Growers’ Association, told BusinessLine that the lockdown helped farmers who were affected by the crop loss to the extent of around 30-35 per cent during the year.

He said the unusual rise in the temperature during the summer months led to tender nut dropping in the arecanut plantations and also affected flowering during the period.

The production loss was compensated by the good price for the commodity during the year mainly because of the lockdown.

Campco’s helping hand

Thanking the Central Arecanut and Cocoa Marketing and Processing Cooperative (Campco) Ltd for its initiative to buy arecanut from growers when there were absolutely no buyers for it in the consuming market, he said, “Campco’s brave decision prevented farmers from venturing into panic selling of the commodity.”

Campco had started buying arecanut from growers on April 13 before the end of the lockdown-1. It had fixed a base price of ₹250/ kg for new stocks and ₹275/kg for old stocks of white arecanut.

Campco officials had stated then that the cooperative took this decision to instil confidence among growers, though there no market was working at the consumers end then.

Encouraged by Campco’s move, other arecanut cooperatives in red arecanut growing areas such as the Sirsi-based TSS (Totagars’ Cooperative Sale Society) also decided to venture and buy arecanut from the growers.

Increase in prices

By the end of May, both white and red varieties of arecanut had witnessed increase in the prices from their pre-lockdown market closure. In the pre-lockdown closure, white variety was trading in the range of ₹250-260 a kg, and red in the range of ₹340-370 a kg.

By December, both white and red arecanut had breached the ₹400 a kg mark in the market.

The participants in the arecanut cooperatives attributed the reasons such as the complete stoppage of import (both by legal and illegal means) during the lockdown and the subsequent demand for the arecanut in the consuming market in northern India as the increase in the price of the commodity.

Based on processing, arecanut is classified as white and red varieties. White arecanut is prepared by drying the ripe arecanut in the sun and dehusking it. Red arecanut is prepared by dehusking green arecanut, and then boiling and drying it. White arecanut is produced in coastal Karnataka and some parts of Kerala, red arecanut is produced in Shivamogga, Davangere and Chitradurga districts of Karnataka. The red variety is mainly used in the manufacture of ‘paan masala’, and the white variety for ‘paan’ preparation.

Published on December 29, 2020

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