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| Sunday, 29 January 2006 |
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| News Business Features Editorial
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Coconut prices drop - growers in a quandary by Elmo Leonard The island's coconut growers are in a quandary, with coconut prices at last week's auctions falling to Rs 10.50 per nut, while the cost of producing a coconut is Rs 8 to Rs 10. What coconut growers fear more is the coming months of May-June, when crops will increase and prices are likely to plummet to Rs 6 to Rs 7 per coconut. Beginning October, the lean cropping period begins, and prices climb, being detrimental to the housewife and favourable to the grower. The growers' problem is even more weighted as the whole of last year was wet, making it conducive for a far better harvest than last year's 2.7 billion nuts, as determined by the Coconut Development Authority (CDA). In past decades, higher crops kept the consumer happy with lower prices, and the grower having more to supply exporters of desiccated coconut and coconut oil millers. Now, most of the coconut oil mills have closed with the international price of vegetable oil being far lower than the cost of coconut oil produced locally. Throughout last year, the local price of desiccated coconut was around $100 per tonne more than the international price, making locally produced desiccated coconut uncompetitive. In this scenario, Sri Lanka's harvest of coconuts go direct to the local consumer, drowning the factor of demand and lowering prices. The Coconut Growers' Association of Sri Lanka (CGASL) comprising 700 growers, feel that the government should increase the tariffs of imports of vegetable oils into the country and urge coconut oil millers to re-start their mills. President, CGASL Ranjith Dias said that if the 15 percent VAT on coconut oil is also removed, prices of coconut oil would become competitive with the international prices of vegetable oil and provide a boost for the industry and growers. |
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