Having built up sufficient stocks ahead of Onam, the demand from stockists and retail packing companies have begun to ebb at Kerala's wholesale markets and coconut oil prices have begun to ease. The prices plunged from Rs 96 to Rs 92 a kg in Kerala's wholesale markets, while the fall was far more steeper in Tamil Nadu where it fell from Rs 90 to Rs 82 a kg, Mr Prakash B. Rao, Member of the Cochin Oil Merchants Association (COMA), said.

There is sufficient stock available in the Kerala market for the ensuing Onam season and the demand has waned, sources in the trade said. The prices are expected to dip further as the flow of coconut oil from Tamil Nadu to Kerala is expected to taper off further for another 10-14 days. The only positive signal for the coconut oil market could come from a revival in North Indian demand.

The demand for edible copra is expected to resume with the coming Navarathri festival season which will be followed by Diwali in North India. But even the festival-based demand is not expected to have an overhanging impact on the market. The coconut oil-based soap and cosmetic industry has built up sufficient stocks and their demand is not expected to support the market in the event of an immediate rally, trade sources said.

Copra prices

Following the trends of coconut oil, copra prices have also begun to ease. Copra was quoting at Rs 60 down from Rs 64/kg during last week in the Kerala market, while it fell from Rs 64 to Rs 56/kg in wholesale markets of Tamil Nadu. As the prices have begun to ease, availability has increased and traders have begun to unwind their stocks fearing further falls.

Palm kernel oil prices have fallen to Rs 74, while palm oil was quoting at Rs 58/kg. With coconut oil prices breaching the Rs 100/kg mark, there had been fair amount of shift from coconut oil to palm kernel oil by industrial consumers. Once coconut oil prices ease further, revival in industrial demand is expected to provide further the support to coconut oil at lower levels.

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