Agri Business

Arecanut: Economically attractive

| Updated on March 12, 2018

BL19_YESBANK_ARECANUT

‘Arecanut', botanically known as Areca catechu, is a tropical plant found all over South East Asia. This tree belongs to the palm tree species and is from the Arecaceae family. The fruit (nut) of this tree is popularly known as the betel nut or supari in India. This is an important commercial crop of the region and also forms part of ritual offerings in Hindu religion. Areca is taken up from the Malayan language which means ‘cluster of nuts'.

Globally it is primarily grown in India, Bangladesh, China, Indonesia and Myanmar. India leads the production followed by China and Bangladesh. In India it is grown in Karnataka, Kerala, Assam, Maharashtra, West Bengal and parts of Tripura.

History

The exact origin of the nut cannot be traced back but it probably originated in Malaysia or Philippines. The use of nut for chewing started in Vietnam and Malaysia, primarily, for the ‘stimulating' affect of the alkaloids present in the nut.

These areas still have the widest variety of the plantation belonging to the ‘Areca' genus. From this region, the crop traveled to the rest of Asia where it is cultivated as a cash crop.

In India areca nut is mentioned in Ayurveda, and also finds mention as far back as 2,000 years. Marco Polo also mentioned about areca nut in the 13th century. Chewing arecanut with betel leaf (or paan) with some other ingredients is an old habit in the daily life of the Indians.

Cultivation

Arecanut is a crop in areas where abundant rainfall is present as it cannot tolerate drought or low rainfall. It grows well in temperature climates within the range of 14 – 36 degree C.

The tree grows approximately 30 m in height and starts giving fruit from the 5th to 7th year till up to an average lifespan of 60 years. The economic life is on an average of about 40 years. Though the deep clay loam soil is more suitable for its growth, it also grows in alluvial, lateritic or red loamy soil.

Flexible to intercropping

The fruit is oval in shape and the colour ranges from yellow, orange to red. Due to a gestation period of at least 5 years, it makes sense to intermix arecanut with banana, mango, jackfruit, coconut, cocoa, ginger, pepper and vanilla. In fact, Acid lime and betelvine are suggested in West Bengal.

It is crucial to harvest the arecanut at specific stages to obtain the best quality produce. The fruits are harvested annually, dried and dehusked. The harvested nuts have to be sun dried for 45 days. It is essential to spread the nuts uniformly in a single layer and turning should be done once a week. This would prevent fungal infection of the nuts.

Economics

The price of the red variety is currently around Rs 130-140 a kg, while the price of the white variety, is around Rs 100- 110 a kg.

The cost of cultivation of the white ‘areca nut' is Rs. 114 per kg and for the red one is Rs. 148 per kg. This makes ‘areca nut' cultivation not a very lucrative proposition.

But mixed cropping, value addition and extraction of by-products lend the economic attractiveness.

Research is on to determine better extraction of tannin which has demand in wine and cosmetic industries. Areca nut cultivation also supports livelihoods and thus increasingly adds up deriving immense value for the society.

Market

India is the highest producer of arecanut with a production of around 3.3 lakh tonnes and a total acreage under cultivation of 2.64 lakh hectares, with Karnataka and Kerala accounting for nearly 72 per cent of the total production.

Over six million people are engaged in arecanut cultivation, processing and trade. More than 85 per cent of the area under cultivation is made up of small and marginal holdings.

Among the two varieties white nuts have a share of 60 per cent. India is also the largest consumer with around 3.2 lakh tonnes.

The following factors influence the areca nut market:

•Weather conditions

•Government policies over the pricing of betel nut

•Carryover stocks

•Growth of the consumer industries

•Government policies over the consumer industries

Multi-State cooperative such as CAMPCO (Central Arecanut and Cocoa Marketing and Processing Co-operative), a joint venture of the States of Karnataka and Kerala, has been established in 1973 for procurement of areca nut.

The major arecanut trading centres in India are Mumbai, Ahmedabad, Indore, Jaipur, Delhi, Nagpur, Patna, Calcutta, Cuttack, Bangalore, Rajkot, Chennai and Kanpur.

(Source: YES Bank)

Published on March 18, 2012

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