With supply increasing in Kerala, Karnataka and Tamil Nadu, coconut oil price have crashed across South India.
The price on Friday dropped to Rs 6,150 a quintal from Rs 6,200 last Friday. On July 3, the Kochi market quoted Rs 6,350 and the highest in this season was Rs 6,450 in June.
As the monsoon is yet to pick up in Kerala, copra production is vibrant across the state especially in northern districts. This has enhanced the supply and processing of raw coconut is very active as there have been no disruption due to the monsoon.
According to Thalath Mohamed, president, Cochin Oil Merchants Association, supply from all the southern states is very active. Karnataka saw good production this year and supply is at its peak now. Tamil Nadu is also supplying in bulk.
As imported edible oils enjoy tariff concession as well as subsidy, their market price at retail level is low which makes a significant dent on the marketability of coconut oil.
Except in Kerala, coconut oil is not widely used for edible purpose.
Excessive import of edible oils, especially palm, during the peak coconut production season would trigger price crash of coconut oil, said Coconut Development Board (CDB) sources.