Coconut oil has slipped further to Rs 86 a kg in Kerala's wholesale markets and to Rs 80 in Tamil Nadu. With fair and sunny weather prevailing over the coconut growing belts of Tamil Nadu and Kerala, the prices are likely to weaken further in the coming couple of weeks, sources in the trade said.

The good weather is enabling the farmers and millers to convert greater quantity of coconuts into copra, which is further converted into coconut oil. With this increased availability, prices are expected to remain weak. But as rains are likely to commence in Tamil Nadu soon, the conversion process is likely to be hampered and prices are expected to rebound, the sources pointed out.

This is an annual phenomenon as traders and millers increase their stocks during the lull between the South West and North East monsoons and wait for the shortage to emerge during the months ahead. While the prices are expected to slip further during the coming fortnight, sources pointed out that no major plunge is expected as competing oils have been holding steady.

Rain to boost production

Palm oil and palm kernel oil were quoting at last week's levels of Rs 55 and Rs 74 a kg respectively. The good rains are expected to further boost production in the coming weeks resulting in increased arrivals.

The post Onam demand from Kerala is still to pick up and the flow of coconut oil from Tamil Nadu to Kerala also remains subdued. With prices continuing to remain low, most of the arrivals are being stocked by the traders and stockists in Kerala.

With the onset of the Pooja and Diwali festivals in North India, there could be some revival of demand for edible copra in the coming weeks. Most of this demand is being currently met from production of Andhra Pradesh and Tamil Nadu. Copra prices were quoting at Rs 56 a kg in Kerala markets as against Rs 54 in the wholesale markets of Tamil Nadu.

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