Comments
Price differentials in coconut oil between Kerala and Tamil Nadu continue to remain quite significant. While prices were quoting at Rs 90/kg in Kerala's wholesale markets, Tamil Nadu prices were at Rs 84.
The wide price differentials have resulted in increased movement of coconut oil from Tamil Nadu to Kerala, Mr N. Anandan, former Secretary of Cochin Oil Merchants Association, said.
“With the coconut oil costing higher, a large number of consumers are switching to other edible oils. The new generation nuclear families are not finding coconut oil an indispensable commodity but are equally at ease experimenting with other cooking oils. Moreover, the increasing habit of eating out is also taking a toll on the consumption of coconut oil,” Mr Anandan said.
In short, consumption of coconut oil is becoming increasingly price elastic.
It is the shortfall in the subcontinent that is supporting prices. The huge shortfall in coconut production has not only resulted in a surge in Indian exports to Sri Lanka, but also to other neighbouring countries such as Pakistan and Bangladesh as well. But for this, coconut oil prices would have eased further, sources in the trade said.
Palm oil prices
The marginal strengthening of palm oil and palm kernel oil prices could sustain an upward bias for coconut oil. Mr Prakash B. Rao, Member of the COMA, said that palm oil was quoting at Rs 58/kg while palm kernel oil fetched Rs 74. The incessant rain in September and the threat of cyclonic storm over the Bay of Bengal are sustaining the firm trends in coconut oil prices, he said. Kerala's continuing demand is one big factor in sustaining prices.
Much of Kerala's coconut oil demand is being met from Tamil Nadu. The number of copra crushing units in Kerala had shrunk from over 2,000 units in the seventies to 1,600 in the eighties. Now there are less than 100 operational units in the State, Mr Anandan said. Simultaneously the number of crushing units in Tamil Nadu has soared and Kerala has become one of the biggest consumers. Copra was quoting at Rs 58/kg in Kerala as against Rs 55 in Tamil Nadu.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.