Coconut price drops to Rs 14, but Kerala govt scrambles to buy at Rs 25

By: | Updated: June 29, 2016 9:06 AM

Kerala is pumping Rs 100 crore for market intervention in coconut industry, alarmed by the rapid drop in prices. In all coconut-producing states, including Kerala, Karnataka, Andhra Pradesh and Tamil Nadu, prices have fallen to Rs 14-16 per nut in the open market.

Kerala’s lead in country’s coconut production map has been closely challenged in the recent years, due to falling prices, urbanisation and falling yield in the land-starved state. (Reuters)Kerala’s lead in country’s coconut production map has been closely challenged in the recent years, due to falling prices, urbanisation and falling yield in the land-starved state. (Reuters)

Kerala is pumping Rs 100 crore for market intervention in coconut industry, alarmed by the rapid drop in prices. In all coconut-producing states, including Kerala, Karnataka, Andhra Pradesh and Tamil Nadu, prices have fallen to Rs 14-16 per nut in the open market.

“On a war footing, the state government intends to procure nuts at the rate of Rs 25 per nut,” according to Kerala agriculture minister VS Sunilkumar. “In the current financial year , this procurement drive would need Rs 100 crore and we are moving papers to speed up funds for market intervention,” he told FE.

KERAFED, the apex outfit that heads a string of coconut co-operatives in the state, has been asked to get cracking on the procurement of raw nuts. Kerafed had been sitting pretty on its stock of coconut oil since that was produced at a higher cost. The apex co-operative, which owns one of the largest copra-milling capacities in Asia, had been waiting for coconut oil prices to pick up before selling the stocks. However, the state has asked the outfit to clear its coconut oil stocks and utilise the amount to expedite the payment of last year’s procurement arrears to coconut farmers. This is expected to plough up Rs 50 crore.

“Defunct coconut-drier units would be immediately restored. Measures will be taken to promote the sale of coconut products through the public distribution system,” the minister said after the meeting on Tuesday.

Meanwhile, the Kerala coconut farmers have urged the minister to ensure that coconuts from neighbouring states do not make their way into the Kerala procurement scene. In Kerala, the price of raw nuts has fallen to Rs 12 per nut, much lower than the Rs 14 per nut in Karnataka, says Ahmmed Kutty, a coconut farmer and mill-owner in Malappuram district. “Timely market intervention would do a great deal to revive confidence in coconut cultivation,” he says.

Kerala’s lead in country’s coconut production map has been closely challenged in the recent years, due to falling prices, urbanisation and falling yield in the land-starved state.

Leg-up
– Kerala is pumping R100 crore for market intervention in coconut industry, alarmed by the rapid drop in prices
– In all coconut-producing states, including Kerala, Karnataka, Andhra Pradesh and Tamil Nadu, prices have fallen to R14-16 per nut in the open market
– The state government intends to procure nuts at the rate of R25 per nut, according to Kerala agriculture minister VS Sunilkumar

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