Low MSP, Union government import policy render Karnataka coconut growers worried and helpless

Copra used to be priced ₹15,000-18,000 per quintal in the wholesale market, but that dropped to ₹8,000-9,500 in the past few weeks.

ByMahesh M Goudar

Published Mar 09, 2023 | 8:30 AM Updated Mar 09, 2023 | 8:30 AM

Crash in coconut price

Coconut growers in Karnataka have held the Union government’s import policy responsible for their woes: Crashing prices, lack of demand, low Minimum Support Price (MSP), and irregular procurement.

Purushotham, a farmer and the proprietor of Vaishnavi Agro Tech from Tiptur, minced no words in pointing fingers at the Union government and its policies for the crash in coconut prices.

“It is the Union government that is responsible for the plunge in coconut prices. Even though we have excess stock of coconut and coconut powder, the government is importing coconut powder. This is the main reason for the fall in coconut prices,” he to South First.

“We even approached the government and elected members of the ruling government, requesting them to stop the import of coconut powder immediately, but the response was not overwhelming,” he added.

“Coconut growers and traders are reeling under a severe financial crisis due to the plunge in coconut prices for the last three-four months. We are not even able to recover the production cost,” said Purushotham.

What affects the coconut farmers?

Even the prices of products, such as coconut husks and shells have taken a hit.

Kumar, a coconut trader, told South First: “Because of good rains this season, Karnataka, Tamil Nadu, and Kerala have witnessed a bumper crop. There is sufficient stock, but demand is less, as this is off-season. There are no buyers even at the current price.”

He added: “In the peak season, the copra — dried sections of the coconut meat — used to be priced between ₹15,000 to ₹18,000 per quintal in the wholesale market. For the last few weeks, the price is hovering at ₹8,000-₹9,500.”

Kumar also said: “Even the coconut price has plummeted by half. A month ago, coconut prices used to be ₹40 per kg. Now, it has gone down to ₹25 per kg. The government has to rescue us from this difficult phase.”

Also read: Coconut oil adulteration in Kerala: Old problem in new bottles

‘Government is importing quality coconut powder’

Meanwhile, India has been importing coconut powder from Indonesia, Malaysia, Sri Lanka, and other foreign countries for the last few years.

India is the third-largest importer of coconut powder — after the United States and the United Arab Emirates — in the world.

This, despite India being one of the leading producers of coconut in the world.

On condition of anonymity, an official from the Coconut Development Board (CDB) in Bengaluru told South First: “We import coconut powder because of the good quality and other reasons. The decision to import coconut powder was taken at the Union-ministry level.”

A CDB official said: “However, the government is making efforts for the price stabilisation of the coconut and its products. The government has announced an MSP to copra for this season.”

He refrained from answering questions on whether the government had any plans to increase the MSP and reduce or discontinue the import of coconut powder.

In Karnataka, the Tumakuru district is the highest producer of coconuts. The Tiptur taluk has the biggest market for coconuts in South Asia.

As per the Coconut Development Board, coconut is cultivated in around 3.88 lakh hectares across Karnataka. Of this, 1.45 lakh hectares are in the Tumkuru district alone.

The Hassan, Udupi, Dakshina Kannada, and Mysuru districts also produce coconuts in Karnataka.

The coconut produced in Tumakuru is transported to Jammu and Kashmir, Punjab, Uttar Pradesh, Maharashtra, and other states in North India.

Also read: Crop destruction by wild boar big problem for Karnataka farmers

Problem with current MSP for coconuts

With coconut prices crashing, the Union government has fixed the MSP at ₹10,860 per quintal for milling copra and ₹11,750 per quintal for ball copra for the 2023 season.

However, the farmers are disappointed with the MSP, and also allege that the authorities are not procuring copra properly.

Srikanth, a coconut grower, told South First: “The production cost, including labour and transportation, has skyrocketed in the last two years. We are selling coconut or copra at a loss. The coconut price has plunged by 50 percent.”

He explained: “In reality, the product is divided into different grades based on the quality of copra. The top quality gets the MSP and grade-2 and below will get a lower rate.”

Srikanth added: “This is not helping any farmers. The government must fix the MSP at at least ₹15,000 per quintal of copra.”

Tumakuru’s Congress leader Ravikumar RS told South First: “It is because of the poor policies of the Central government that the coconut producers and traders are in a soup. The prices of coconut, copra, and coconut shells have crashed.”

He added: “The farmers are not even able to recover the production cost. Due to the fall in prices, farmers are severely affected financially. The government has to increase the MSP by ₹5,000 in order to save coconut growers.”