Coconut oil prices surge as Onam festival nears
The recent surge in coconut oil prices ahead of Onam has brought relief to coconut farmers, with a rise of ₹16 per litre in August-September. Factors such as speculative buying, material shortages due to El Niño, and increased export demand, particularly from Gulf countries, have contributed to the price hike. Upcountry demand is expected to rise during the North Indian festival season.
Bringing cheers to the coconut farming community ahead of Onam, coconut oil prices have increased, registering an increase of Rs16 per litre in August-September.
Thalath Mahmood, President of the Cochin Oil Merchants Association (COMA), said demand is revving ahead of festival season. Prices in the Kerala market reached ₹168 for coconut oil and ₹107 for copra. In Tamil Nadu, the prices are ₹159 and ₹103.50, respectively. He said the demand in the upcountry market was subdued for the time being, possibly because of rains.
However, Bharat Khona, a trader in coconut oil, maintained a cautious optimism, saying speculative buying boosted prices without generating robust demand in the market. The availability of cheaper palm oil is impacting the demand for coconut oil.
Ubais Ali of Mezhukkatil Mills said the commodities market worldwide is witnessing material shortages due to El Nino weather, and this is reflected in copra as well. He attributed the rising prices of coconut oil to the shortage, which has led to weakness in the supply chain. The shortage is expected to move up, giving coconut oil a price advantage.
He pointed out that the export demand of coconut oil is also picking up, thanks to “Back to School” season in gulf countries, forcing Keralites to go back after month long summer vacation. This has revived a demand for all products including coconut oil, witnessing bulk purchases. It is estimated that more than 30 lakh families visited their home in Kerala from the Gulf in the current season as part of school vacation and they are all back. The reviving export market will boost the demand, he added.
On the revival of upcountry demand for copra, he said that it is expected to pick up once the festival season in North India commences, starting from Navarathri.
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Source Link : https://www.thehindubusinessline.com/markets/commodities/coconut-oil-prices-surge-as-onam-festival-nears/article68608382.ece
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