By Saman Indrajith
The Government had taken a decision to permit a certain volume of edible oils to be imported on consessionary duty terms to ease the situation resulting from the prevailing crisis in the coconut industry, said Minister of Plantation Industries, Lakshman Kiriella, in a special message read out at a seminar titled "Present Crisis and Remedy in the Coconut Industry", which was held at the Ceylon Chamber of Commerce auditorium last evening.

"The objectives of this decision were three fold, namely: to make available quality edible oil to consumers at a more reasonable price; to divert a certain proportion of the nuts available to the desiccated coconut (DC) industry and make available to the consumers, coconut at a reasonable price". As a result of this decision, DC millers could sustain production, even at low levels, whilst simultaneously ensuring that farm-gate prices do not reach unremunerative levels. The minister’s message was read out at the seminar by the Secretary to the Ministry of Plantation Industries, K. A. S. Gunasekera.

"If we take the recent years, you will recall that in the year 2000 there was a record production exceeding 3,000 million nuts, resulting in drastically low farm-gate prices and the government had to adopt certain interventions to arrest the decline in farm gate prices", the minister in his message further said.

This was done by curtailing the import of edible oils and promoting local oil production. A few months later from about the middle of 2001 — the exact opposite, namely, a severe shortage of coconuts — was experienced, resulting in the current crisis situation, where most of the processing industries have either closed down or have curtailed production drastically."

The cumulative effect of the drought conditions which prevailed in the year 2000 and 2001 and the curtailment of essential, and critical farm inputs such as fertilizer, due to low income from coconuts, particularly during 2000, have obviously led to the current shortfall in the coconut crop. The situation which prevailed during the past two months, where the retail price of coconuts rose to Rs. 18 per nut and edible grade coconut oil was traded at Rs. 100 per bottle is perhaps unprecedented. Farm gate prices also reached an all-time high record of between Rs. 12 and to 13 per nut.

In the wake of the above, during the past two week period, the Government had taken a decision to permit a certain volume of edible oil to be imported on concessionary duty terms to ease the situation.

The Ministry of Plantation Industries (MPI) with the relevant state agencies are now closely monitoring the implementation of the above interim measure taken by the Government.

Meanwhile, the MPI’s urgent attention has been drawn to finding a medium/long term solution to the problems caused by the erratic supply position of coconuts, so as to establish an atmosphere of stability within different sub-sectors of the industry, thereby eliminating ad-hoc and interim measures and interventions.

"It is my conviction that the future of the coconut industry lies on two crucial factors, namely: an assured annual crop of not less than 3000 million nuts, achieved through higher productivity on existing coconut land and cultivation of new lands and the diversification of high, value-added up market coconut based products to the export markets."

Sri Lanka currently has a product/market portfolio of over 30 different coconut products exported to over 70 countries in different parts of the world. "This should further strengthen our determination and efforts to step up annual coconut production to a base level of at least 3,000 million of nuts. My ministry and the relevant state agencies are now in the process of identifying development strategies and action plans for the development of the industry as a whole.

In this task, I intend maintaining a close dialogue with the different sub sectors of the industry, and action has already been taken to establish a regular forum of a federation of all the associations relevant to the industry to discuss and arrive at a consensus of opinion on development strategies and action plans for the future," the message added.

The seminar was organized by the Coconut Traders’ Association to highlight the views of all sectors involved in the industry and arrive at a viable long term solution for the betterment of the industry. It was attended by the manufacturers of "all" coconut products, growers/plantation companies, consumer organizations, traders of coconut products and exporters.