Coconut oil is fast becoming a luxury in Kerala, with prices nearing ₹500 a kg, and experts predict it could hit ₹600 before Onam.
For many households, the once indispensable kitchen staple is becoming less affordable. As prices soar, many are turning to alternatives like palm oil or vegetable oil.
It’s not just inflation causing the price hikes. The real culprit is a significant drop in coconut production. Over the past year, Kerala’s coconut farms have been hit hard by climate change and a series of diseases that have affected the trees.
As a result, supply has dwindled, and the demand for coconut oil continues to climb, driving prices up.
If that wasn’t enough, there’s another issue that’s affecting local supply: China. The country’s growing demand for coconut-based products has meant that coconuts from Kerala are finding their way across borders.
Tamil Nadu mills are buying up Kerala’s coconuts at premium prices, further depleting local stocks. Add to that rising transport costs, and the price of coconut oil continues to climb.
For private mills, the situation is getting increasingly tough. It now costs up to ₹340 to produce a litre of coconut oil.
With the supply of coconuts getting thinner by the day, many mills are struggling to keep up with costs. Some have already started to shut down or scale back production.
As the crisis deepens, the Kochi Oil Merchants Association has stepped in, urging the central government to relax restrictions on the import of coconuts and copra. The association hopes that easing import controls could help stabilise the market and bring prices down.
With over 2,000 coconut oil businesses across the country, and 400 based in Kerala alone, the industry employs more than 25,000 people, many of whom are concerned about the future.
