Sudden Price Hikes Excite Farmers and Traders

• Farmers and traders are smiling thanks to the sudden rise in coconut oil and copra prices since the beginning of September.
• Copra prices jumped to USD 1,46 per kg and soon reached USD 1,47 per kg in Kerala markets.
• Coconut oil saw a bigger increase, reaching USD 2,23 per kg.
• In Tamil Nadu, prices stood at USD 2,12 per kg for oil and USD 1,56 per kg for copra, according to Thalath Mahmood, President of the Cochin Oil Merchants Association (COMA).

Tender Demand Along with Drought Conditions in Karnataka Boost Prices

Prices are expected to rise further with the upcoming festival demand in North India. Raw coconut prices have also strengthened, reaching USD 0,74 per kg from USD 0,43 per kg just two weeks ago. Industry insiders say that tender coconut demand and drought-like conditions in Karnataka have slashed production. This reduction in copra supply has naturally boosted prices.

Global Supply Challenges Push Coconut Oil Stockpiling

Ubais Ali of Mezhukkattil Mills explains that global supply constraints have affected almost every commodity. He points to concerns about the European Union Deforestation Regulations (EUDR) on crude palm oil and palm kernel oil, which are crucial for making toiletry products. With palm oil supplies under threat, coconut oil is seeing increased stockpiling as an alternative. Lauric acid, a derivative of palm oil, is used in products like hand wash. Supply issues with palm-based oils could push coconut oil demand higher.

Conclusion: High Prices Bring Mixed Blessings

KK Devraj, a coconut oil industry consultant, notes that rising prices of sunflower oil, soya oil, and palmolein, due to higher import duties, have also impacted the coconut oil market. Tamil Nadu, the main supplier of copra, faces a shortage, pushing prices higher despite lower demand from big buyers. With Diwali and other festivals approaching in India, edible copra demand may rise. Although not as much as in previous years. Coconut farmers are benefiting from higher prices, but retail consumers are feeling the pinch as all edible oil prices climb, affecting family budgets.

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