Coconut oil prices ruled steady at Rs 81 a kg in the Kerala market even as they dropped by a couple of rupees in Tamil Nadu, Mr Talat Mahmood, President of the Cochin Oil Merchants Association, said.

Prices plunged in the Tamil Nadu markets to Rs 75 a kg as arrivals from neighbouring Andhra Pradesh and Karnataka revived in the past couple of days. Prices had moved up to Rs 78 a kg in Tamil Nadu during the early part of the week.

There is sufficient availability in Tamil Nadu as industries have been keeping away from the market. Without adequate industrial demand, coconut oil prices are not expected to make much of a recovery, sources said. While industrialists are waiting and watching which direction coconut oil prices will head in the coming days, trade sources say they do not have much time ahead.

Need to stock up

As summer demand will revive in the next couple of months, coconut oil will be in demand. As coconut oil has a tendency to freeze during winter months, the demand for coconut-oil based hair oils, shampoos and other cosmetics plunges in North India. But they have to start stocking for the coming summer months, sources said. The low price of palm kernel oil is seen as another reason for the fall in coconut oil prices.

The high price differential between Kerala and Tamil Nadu markets is also an indication that this difference would be breached and prices in Tamil Nadu are likely to recover soon.

The lean coconut production season is about to set in over Kerala and arrivals are likely to dip. However, production from Tamil Nadu is not expected to register any significant fall.

Copra prices were quoting at Rs 56 a kg in the Kerala markets as against Rs 54 in Tamil Nadu.

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