The prolonged bull run seems to over as far as coconut oil prices are concerned. After ruling at a high level through out 1999, coconut oil prices have plunged to a low last week. Market analysts say that the prices seems to be returning to the 1996 levels. According to them the delay in the announcement of the minimum support prices for the copra is the main reason for the current price fall. Since the oil prices determine the prices of coconut.

The trend in the highest and lowest prices recorded in the last few years show that in 1996, the highest stood at Rs 6,500 per quintal and the lowest price stood at Rs 3,600 per quintal for coconut oil. Since than the lowest price have always stood above the 1996 level till recently. Bur on march 21, it fell to RS 3,775 per quintal, which is the lowest price being registered after 1996. On March 24, the prices fell further and have come down to Rs 3,600 per quintal which is the same price recorded in 1996.

Delay in support prices of copra is another reason in down fall in coconut oil prices. The minimum support price is presently fixed at Rs 3,100 per quintal for copra. This was fixed in February 1999. The government has not yet revised the price.

Market Update
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