Stock piling by traders ahead of festival season may stabilise coconut oil prices in Kerala and Tamil Nadu in the coming weeks.
In Kerala, the prices touched Rs 77 per kg (Rs 76) while in Tamil Nadu, it went up to Rs 74.50 per kg (Rs 73).
The increasing price trend has also been witnessed in copra prices; shooting up to Rs 5,650 per quintal in Kerala (Rs 5,600), whereas in Tamil Nadu, the prices were quoting at Rs 5,500 per quintal the same level quoted last week.
Prakash B.Rao, Vice-President, Cochin Oil Merchants Association (COMA), pointed out that aggressive buying of copra and coconut oil is likely to come down in the short-term as traders have kept enough stocks now for adequate supply.
He said that the traders are holding sufficient stocks and even corporates have slowed down their purchase as they procured ample quantity during this period to meet the demand.
There were also reports from the market that corporates have temporarily stopped buying both copra and coconut oil from large terminal markets in Kerala and Tamil Nadu, he added.
The price increase in Malaysian futures and the rupee devaluation also firmed up palm oil prices to Rs 68 per kg (Rs 63) and palm kernel oil to Rs 70 per kg against Rs 58.
Thalath Mahamood, former President, COMA, said that the market is showing a steady trend and the prices are likely to remain at the same level till the end of the festival season in Kerala. This market sentiment has boosted the prices on account of heavy buying.
At a time when the prices of other essential commodities, including vegetables, showing an upward trend in the recent period, coconut oil prices could also not be spared from the rally, he said.
Various parts of central and southern Kerala are facing acute copra shortage due to non-availability of coconut climbers in the region.
Bharat N.Khona, former Board Member, COMA, said that the unprecedented spurt in prices did not cheer up buyers’ interest especially from upcountry markets.
This is evident from the price drop, as the Tamil Nadu loose coconut oil market has come down to Rs 1,100 for 15 kg against Rs 1,140 quoted last week.