You are here: Home » Economy & Policy » News
Business Standard

Arecanut slide hits coffee growers

Around two-fifth of the country's crop (India is the world's biggest producer and consumer) comes from Karnataka

T E Narasimhan  |  Chennai 

Image via Shutterstock
Image via Shutterstock

growers in Karnataka, earlier pinched by a drop in production and price, are now feeling the heat from a crash in price of arecanut, a major intercrop (growing in alternate rows or sections in the same field) for them. The price of (better known as the source for the betel nut or supari) has dropped over a year from nearly Rs 75,000 a quintal to Rs 25,000-30,000 a qtl. Around two-fifth of the country's crop (India is the world's biggest producer and consumer) comes from Karnataka.

Last week, Baba P S Bedi, former chairman of the (KPA), said it was a lucrative crop for quite a while till last year. Total demand in the country is estimated at around 1.2 million tonnes; output is around 700,000 tonnes.


India imported 67,824 tonnes worth $159 million in 2015-16, from 110,000 tonnes worth $230 mn in 2014-15. Growers say prices have come down due to slowing in the export market, especially regarding Pakistan. And, imports have risen from Sri Lanka. Traders import from Indonesia, through Sri Lanka, by getting a ‘Certificate of Origin’ from the latter. Imports from Lanka to India attract zero per cent customs duty, under a free trade agreement (FTA) with that country. 'Rule of Origin’ is permitted under the with a provision that the exporting country must do a minimum value addition of 25 per cent.

Related restrictions on sale of tobacco and supari is given as another reason for a drop in demand and, therefore, the price.

Buying of is predominantly by traders and stockists, who try to do so when prices are low.

Rohan Colaco, earlier a KPA executive committee and a major grower, says there had been a rise in output over the years. Since the crops of paddy and maize are labour-intensive, farmers shifted to in the western ghat region. Also, over the years, quite a few sugarcane growers had converted to arecanut. In 2011-12, sowing was on 441,000 hectares; in 2015-16, this had risen to 473,000 ha.

Last year, said Colaco, the price varied between Rs 35,000 and Rs 75,000 a qtl for procesed arecanut. It is now Rs 27,000-28,000 a qtl.

RECOMMENDED FOR YOU

Arecanut slide hits coffee growers

Around two-fifth of the country's crop (India is the world's biggest producer and consumer) comes from Karnataka

Around two-fifth of the country's crop (India is the world's biggest producer and consumer) comes from Karnataka
growers in Karnataka, earlier pinched by a drop in production and price, are now feeling the heat from a crash in price of arecanut, a major intercrop (growing in alternate rows or sections in the same field) for them. The price of (better known as the source for the betel nut or supari) has dropped over a year from nearly Rs 75,000 a quintal to Rs 25,000-30,000 a qtl. Around two-fifth of the country's crop (India is the world's biggest producer and consumer) comes from Karnataka.

Last week, Baba P S Bedi, former chairman of the (KPA), said it was a lucrative crop for quite a while till last year. Total demand in the country is estimated at around 1.2 million tonnes; output is around 700,000 tonnes.

India imported 67,824 tonnes worth $159 million in 2015-16, from 110,000 tonnes worth $230 mn in 2014-15. Growers say prices have come down due to slowing in the export market, especially regarding Pakistan. And, imports have risen from Sri Lanka. Traders import from Indonesia, through Sri Lanka, by getting a ‘Certificate of Origin’ from the latter. Imports from Lanka to India attract zero per cent customs duty, under a free trade agreement (FTA) with that country. 'Rule of Origin’ is permitted under the with a provision that the exporting country must do a minimum value addition of 25 per cent.

Related restrictions on sale of tobacco and supari is given as another reason for a drop in demand and, therefore, the price.

Buying of is predominantly by traders and stockists, who try to do so when prices are low.

Rohan Colaco, earlier a KPA executive committee and a major grower, says there had been a rise in output over the years. Since the crops of paddy and maize are labour-intensive, farmers shifted to in the western ghat region. Also, over the years, quite a few sugarcane growers had converted to arecanut. In 2011-12, sowing was on 441,000 hectares; in 2015-16, this had risen to 473,000 ha.

Last year, said Colaco, the price varied between Rs 35,000 and Rs 75,000 a qtl for procesed arecanut. It is now Rs 27,000-28,000 a qtl.
image
Business Standard
177 22

Arecanut slide hits coffee growers

Around two-fifth of the country's crop (India is the world's biggest producer and consumer) comes from Karnataka

growers in Karnataka, earlier pinched by a drop in production and price, are now feeling the heat from a crash in price of arecanut, a major intercrop (growing in alternate rows or sections in the same field) for them. The price of (better known as the source for the betel nut or supari) has dropped over a year from nearly Rs 75,000 a quintal to Rs 25,000-30,000 a qtl. Around two-fifth of the country's crop (India is the world's biggest producer and consumer) comes from Karnataka.

Last week, Baba P S Bedi, former chairman of the (KPA), said it was a lucrative crop for quite a while till last year. Total demand in the country is estimated at around 1.2 million tonnes; output is around 700,000 tonnes.

India imported 67,824 tonnes worth $159 million in 2015-16, from 110,000 tonnes worth $230 mn in 2014-15. Growers say prices have come down due to slowing in the export market, especially regarding Pakistan. And, imports have risen from Sri Lanka. Traders import from Indonesia, through Sri Lanka, by getting a ‘Certificate of Origin’ from the latter. Imports from Lanka to India attract zero per cent customs duty, under a free trade agreement (FTA) with that country. 'Rule of Origin’ is permitted under the with a provision that the exporting country must do a minimum value addition of 25 per cent.

Related restrictions on sale of tobacco and supari is given as another reason for a drop in demand and, therefore, the price.

Buying of is predominantly by traders and stockists, who try to do so when prices are low.

Rohan Colaco, earlier a KPA executive committee and a major grower, says there had been a rise in output over the years. Since the crops of paddy and maize are labour-intensive, farmers shifted to in the western ghat region. Also, over the years, quite a few sugarcane growers had converted to arecanut. In 2011-12, sowing was on 441,000 hectares; in 2015-16, this had risen to 473,000 ha.

Last year, said Colaco, the price varied between Rs 35,000 and Rs 75,000 a qtl for procesed arecanut. It is now Rs 27,000-28,000 a qtl.

image
Business Standard
177 22

Upgrade To Premium Services

Welcome User

Business Standard is happy to inform you of the launch of "Business Standard Premium Services"

As a premium subscriber you get an across device unfettered access to a range of services which include:

  • Access Exclusive content - articles, features & opinion pieces
  • Weekly Industry/Genre specific newsletters - Choose multiple industries/genres
  • Access to 17 plus years of content archives
  • Set Stock price alerts for your portfolio and watch list and get them delivered to your e-mail box
  • End of day news alerts on 5 companies (via email)
  • NEW: Get seamless access to WSJ.com at a great price. No additional sign-up required.
 

Premium Services

In Partnership with

 

Dear Guest,

 

Welcome to the premium services of Business Standard brought to you courtesy FIS.
Kindly visit the Manage my subscription page to discover the benefits of this programme.

Enjoy Reading!
Team Business Standard