Going batty over nuts
View(s):According to a gazette notification issued by the Consumer Affairs Authority, a maximum retail price per coconut has been announced. Under this directive, the maximum retail price for a coconut with a circumference of 13 inches is Rs. 70 per nut, a coconut with a circumference of 12 to 13 inches is Rs. 65 per nut, while a coconut with a circumference below 12 inches is priced at a maximum of Rs. 50 per nut.
The gazette had a major flaw – the size of the coconut is given in inches when the prescribed measurement used in Sri Lanka is centimetres, a mistake acknowledged by government ministers and even the minister in charge of coconuts, Arundika Fernando who has a rather long title – State Minister of Coconut, Kithul, Palmyrah and Rubber Cultivation Promotion and Related Industrial Product Manufacturing and Export Diversification.
Ironically, as the trio of friends were also discussing – you guessed it – coconuts during Thursday’s conversation under the margosa tree, in the neigbourhood the sound of radio in a house could be heard of a popular M.S. Fernando song –‘Pol pol pol pol pol pol pol pol.. lankawe wathuwala wawana pol’, ‘Pol pol pol pol pol pol pol pol pol .. pitarata patawana pol’. In translation, it means ‘Coconuts grown in Sri Lankan plantations’, ‘Coconuts … that are exported’.
“Me davaswala, pol gena loku prashnayak thiyenawa (There is a big issue over coconuts these days),” said Kussi Amma Sera. “Mila thama prashne. Jeevathwenna hari amarui. Podi pol ganna thama minisunta wela thiyenne, loku pol ganang hinda (The price is the issue, it’s very difficult to survive these days and people have to buy the small coconut as the big ones are unaffordable),” noted Serapina. “Mata therenne ne ape rate wavana deval, api pita-ratata arina deval, mokada mechchara ganan kiyala (I just can’t understand why local produce, which is also exported, has to cost so much to households),” added Mabel Rasthiyadu.
“Kavuda loku ganak thiyaganne, pol waga-karuwoda nethnam vikunana minissuda kiyala mama danne ne (I don’t know whether it is the producer or the trader who is making a big profit),” said Kussi Amma Sera.
As I moved away from the office window, out of sight of the three friends, the phone rang. It was Kalabala Silva, the often agitated academic, on the line wanting to discuss – you guessed it again – coconuts.
“I say, what is wrong with the government. How the hell can you sell coconuts through a measurement system,” he asked, laughing. “It’s a big joke,” he added. “I think the authorities have blundered with this move,” I said, adding my two cents’ worth.
He then pointed out some ‘amusing’ facts:
- The move can create employment for thousands of unemployed youth, with the authorities hiring them as measurement experts at shops of coconut traders. They may need both a measuring tape in centimetres and also in inches and be masters at calculations.
- The dashing or breaking of coconuts is a ritual practised widely to invoke a blessing or a curse on someone. In such a case, what would be the circumference of the coconut that would be used in this exercise?
- Do consumers have to carry measuring tapes with them to ensure that the traders are not using ‘fake’ tapes giving a false measurement?
- Producers will now have to start measuring each and every coconut in the farms before they are shipped to the markets and in the supply chain, traders and shopkeepers would have to do their own measurement before accepting all the goods. Thereafter it will be the turn of consumers to measure the nuts at the point of sale.
“This is one of the most absurd decisions I have seen made by a government,” said Kalabala Silva. We continued the conversation for a long spell thereafter, discussing various common issues including the controversial 20th Amendment to the Constitution.
To get more details of the crisis in the coconut sector that has triggered a spiral in prices, we spoke to Chrisantha Jayawardena, a senior member of the Coconut Growers’ Association. It appears the price hike is due to seasonal fluctuations in productivity.
Just like the paddy sector which has two seasons – Yala and Maha – the coconut sector, which has the second largest component of labour used after paddy, also has two seasons. In this case, however, the two seasons are split between one which is productive and the second which is unproductive. Production is high during January to June while production is low during July to December and the present cycle of rising prices is a seasonal phenomenon.
“This is nothing new. Prices rise during this period due to a short supply in the market when there are fewer nuts for sale,” he said. According to official statistics, annual coconut production for 2019 in Sri Lanka was more than 3 billion nuts, a 17.6 per cent increase over 2018 with 1.8 billion nuts used for domestic consumption. According to the Central Bank, the average auction price fell to Rs. 27.55 per nut in 2019 from Rs. 45.55 per nut in 2018, while the average retail price in 2019 declined by 27.4 per cent to Rs. 50.64 per nut compared to the previous year.
The government’s fixed price per coconut came after nuts were trading at an exorbitant Rs. 100 per nut. Mr. Jayawardena said that due to a good crop in 2019 farmgate prices were as low as Rs. 22-23 per nut which was below the cost of production. He said that for farmers to recover the cost of production plus keep a small profit, the farmgate prices should be in the region of Rs. 45-50 per nut, adding that by next January prices should fall when the crop improves.
Production should also improve in the future when new areas of coconut plantations start coming on stream like Moneragala, Anuradhapura, Mahaweli areas in Polonnaruwa, the north – Jaffna, Vavuniya and Kilinochchi –, and the east – Batticaloa.
As I wound up the column (at the end of the day, I don’t know whether I have become batty or nutty), Kussi Amma Sera brought in my second mug of tea, saying: “Sir, pol gena-neda liyanne (Sir, you are writing about coconuts).” I nodded and spent a few minutes reflecting on the dilemma often faced by governments in striking a fine balance in pricing between the producer and the consumer so that both sides benefit in the equation – the producer gets a decent price for his produce, while the consumer is not over-charged.