Arecanut output expected to drop due to heavy rains, illegal imports

“We expect 35 per cent shortfall in the crop. Rains have led to disease of the nuts,” said M Suresh Bhandary, MD of Mangalore-based Campco.

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Indonesian arecanuts are reaching Indian shores through Myanmar illegally.
KOCHI: Heavy rain in Kerala and parts of Karnataka in the past two months has damaged the arecanut crop. Growers are also expecting a sharp drop in production in the coming harvest as they struggle to cope with illegal imports into the country.

“We expect 35 per cent shortfall in the crop. Rains have led to disease of the nuts,” said M Suresh Bhandary, MD of Mangalore-based Campco, which buys large quantities of nuts. Arecanut, a chief ingredient of pan masala, is mainly grown in Karnataka, Kerala and Assam. As per advance estimates of production by Directorate of Arecanut and Spices Development, output was 822,495 tonnes in 2017-18, a marginal rise from the previous year. Though area under the nut has remained stagnant, productivity has gone up in certain regions.

After the government increased the minimum import tariff to Rs 251 per kg last year, imports through regular channel have come down. But many traders have found a way to circumvent it as the duty is different for different countries.


Nut snip 1

“Traders often bypass it by showing different source and quality. The import from Malaysia may come through Sri Lanka, where there is a lower duty under Safta,” said Manchi Srinivasa Achar, president of All India Areca Growers Association.

Another worry for areca farmers is the illegal imports from Myanmar. Indonesian arecanuts are reaching Indian shores through Myanmar illegally. “These nuts are cheaper and used by pan masala makers in India. It adversely affects local growers,” Bhandary said.

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Growers fear a drop in output will raise the volume of illegal imports into the country further as local prices are likely to go up. According to Achar, imports are likely to go up from around 80,000 tonnes to 1 lakh tonnes in the current year. The red variety arecanut, which is priced around Rs 270 per kg, is used in pan masala.
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