Traders fear copra prices will drop on NAFED’s move to sell procured stock

Copra traders are keeping their fingers crossed over the NAFED (National Agricultural Cooperative Marketing Federation of India) decision to liquidate the procured stock in the open market. They fear that the move would further depress the prices.

NAFED, according to traders, is selling in the open market around 39,000 tonnes of copra that was procured from farmers in Tamil Nadu in 2023 season. Traders aired a concern over its impact on prices when such a huge quantity enters into the open market.

As far as Kerala is concerned, the procured copra was only 102 tonnes and its impact on prices following the selling off the stock is likely to be minimal.

Prices ruling steady

Thalath Mahmood of Cochin Oil Merchants Association (COMA) said presently both copra and coconut oil prices are ruling steady in Kerala, quoting ₹100 and ₹154 respectively despite a subdued upcountry demand. The price trend is expected to continue for some more time, thanks to some local purchase.

• Also read: NAFED hopeful of meeting onion procurement target even as farmers demand better rates

However, Ubais Ali of Mezhukkattil Mills said that prices are maintaining at a steady level and logistical issues connected with copra imports are a contributing factor.

Copra prices in international markets have started moving up, witnessing a 12 per cent rise in producing countries mainly because of increased freight rates related to logistical hurdles. The increased price of imported copra has hit many branded coconut oil producers, who import the commodity for re-exports.

But still, Indian copra prices are still ruling high at $1250 per tonnes against $1000 in South East Asian countries, he said.

There was a considerable drop in ball copra prices in Karnataka due to a subdued North Indian demand. This has forced traders there to covert ball copra into milling copra. A firm demand for ball copra is expected only with the beginning of festival season starting October, he added.

Coconut farming community pointed out that the price drop was evident in 2022 and 2023 season when the regulatory agency liquidated the procured copra stock in the open market.

To avoid such a situation, there were suggestion for NAFED to produce coconut oil from the procured stock and sell it in the retail market under the brand name Bharat in line with rice and atta.

• Also read: Renowned economist Madhura Swaminathan calls for legal guarantee of MSP