The coconut oil market is witnessing short-covering with major corporates buying huge quantities of copra. This has resulted in slight improvement in prices.
Coconut oil prices touched Rs 63.50 per kg in Kerala (Rs 63), while in Tamil Nadu, the prices went up to Rs 62 per kg against Rs 60 quoted last week.
According to Prakash B. Rao, Vice-President, Cochin Oil Merchants Association (COMA), major corporates have increased their purchase price which has also boosted the market sentiments.
Copra prices have also shown an upward trend at Rs 4,600 per quintal in Kerala (Rs 4,400), while in Tamil Nadu it stood at Rs 4,500 per quintal (Rs 4,350). The upward trend witnessed in copra market is due to lower-level buying by corporates and traders.
This is expected to be a short-term rally as the season in Tamil Nadu is about to start next month, he added.
Other edible oils such as palm oil and palm kernel oil remained at the same level quoted last week at Rs 52 and Rs 53 per kg, respectively. Piling up of edible oil stocks with large-scale importers was the reason for the prices remaining stagnant, he added.
Copra procurement
Thalath Mahamood, former President, COMA, said that the market, which is witnessing a steady trend, is expected to continue for the time-being. Market sentiments have improved with the Government agreeing to bear the losses suffered by Nafed on copra procurement.
However, he reiterated that the Government should intensify copra procurement to boost the market as the arrival of copra is on the rise. Moreover, the decision of the Kerala Government to procure raw coconuts to sell in the open market will also boost up sales and get a better price for farmers, he added.
Bharat N. Khona, former Board Member, COMA, said that though the market is ruling steady, the demand from upcountry buyers was not reflected due to low pricing of other edible oils.