Agri Business

Red arecanut prices see steep rally in a week

Mangaluru | Updated on September 06, 2021

Shortage of new stock, strict control of illegal imports cited as reasons

The price of red arecanut has been seeing a steady increase since August-end. After crossing ₹500 a kg during the last week of August, it is now hovering around ₹600 a kg.

The price was above ₹430 a kg mark just before the announcement of the lockdown this year.

Factors

Market participants attribute factors such as shortage of new stock of red arecanut, both in consumption and producing centres, strict control of illegal imports of arecanut, and the delay in the arrival of new crops as reasons for this rally in prices.

Ravish Hegde, General Manager, Totagars’ Cooperative Sale Society (TSS) Ltd, told BusinessLine that the harvesting of red arecanut has been delayed due to rainfall in growing regions.

Hegde said the arrivals of red arecanut were less, so far, but regions such as Shivamogga and Channagiri regions should have got new crops by now. However, the rainfall is affecting the prospects of arrivals, he said.

Centre’s measure

Kishore Kumar Kodgi, President of the Central Arecanut and Cocoa Marketing and Processing Cooperative (Campco) Ltd said that the Centre has taken strict measures to control the illegal import of arecanut from other countries. This has been helping a lot for both white and red arecanuts. The restriction on illegal imports has even helped in farmers getting remunerative prices for white arecanut, he said.

Sources in the market said ‘gutkha’ and ‘paan masala’ manufacturing factories were stocking up the commodity earlier. That is not the case now.Some of the traders, who had purchased it at high prices earlier, are hiking the prices in the market now, sources said.

SN Khandige, Vice-President of Campco Ltd, said some arecanut factories have been using lower quality white arecanut in addition to red arecanut for manufacturing of various products. The rally in the prices of red arecanut is helping boost the prices of these lower quality white arecanut, he said.

While Campco offered up to ₹505 a kg for old stocks of white arecanut and ₹465 a kg for new stocks of white arecanut on Monday, lower qualities of white arecanut were getting up to ₹385 a kg.

These lower quality white arecanuts were getting up to ₹375 a kg during mid-August.

Mahesh Puchhappady, General Secretary of All-India Areca Growers’ Association, said that the steep rally in the prices of red arecanut in the last few days could have some valid reasons. However, the farmers need to tread cautiously for the steep increase in prices as any steep fall in the prices may affect them only, he said.

Published on September 06, 2021

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