Oil Palm in India: Market Arrivals and Price Movements

Abstract

Oil palm is native to West Africa. It is one of nine major oils traded in the global edible oil. The study focuses on the trends in oil palm arrivals and market prices in India, particularly in Andhra Pradesh and Telangana states. There was a significant increase in annual oil palm arrivals from in Andhra Pradesh and Telangana, with a percentage change of 92.43% and 84.83% respectively. This increase was statistically significant at a 10% level, R² values are 0.9243 and 0.8483 respectively. A linear trend analysis for prices of oil palm from 2010 to 2022 indicated a consistent rise in oil palm prices in both states, with Andhra Pradesh seeing an annual increase of 737.05 Rupees and Telangana 757.72 Rupees. The percentage change in prices was 59.18% and 66.08% respectively, with R² values of 0.5918 and 0.6608. Positive and significant correlation coefficient is observed in both the states. Seasonal variations in prices were also analyzed, highlighting that oil palm prices were typically drop after harvest it is influenced by peak harvesting periods and imports of crude oil from other countries. In Andhra Pradesh, the seasonal price index for oil palm Fresh Fruit Bunches (FFBs) was highest in May and April months, then decreased to a minimum level due to increase in the oil palm arrivals. Understanding these seasonal patterns is crucial for effective decision-making by farmers, traders, and policymakers.