Annoyed by the strong dip in the oil palm fruit procurement price in the recent past, the oil palm cultivators in Tamil Nadu have urged the State Government to implement a market intervention scheme to safeguard their interests and offer a just price for their produce.

“The price of an oil palm bunch should be fixed at Rs. 5,000 a tonne if the farmers have to find viability in raising the crop. The crushing firm is also awaiting the word from the State Government on the pricing issue keeping the farmers on tenterhooks. The uncertainty has to end and that is in the hands of the Government,” said Cauvery Delta Farmers Welfare Association Working president Mahadanapuram V. Rajaram. Oil palm cultivation has been carried out in the State since 1995 and the governments have been extending subsidies to the tune of Rs.23,000 per hectare for three years. While there are numerous palm oil crushing units in Andhra Pradesh, Goa and Karnataka, there is only one unit in the state at Varanavasi in Ariyalur district. Though there are claims that more such units are to come nothing has come into effect yet.

Due to enormous import of palm oil, the price in the country that was reigning at Rs. 50,000 per tonne slid to Rs. 30,000 around the same time next year. That had a cascading effect on the purchase price of the oil palm fruit, which is the raw material for palm oil. The crushing mills that were paying Rs.5 per kg reduced the purchasing price to Rs.4 a kg leading to an outcry from the oil palm growers. That led to major palm oil producing states putting in place a market intervention scheme to protect farmers' interests. That led to State governments coming forward to bear the additional burden.

Seeking a similar remedy, the oil palm farmers in Tamil Nadu have been pressing the State government but so far their petitions had received the stock reply that their interests would be protected. Some oil palm farmers had even threatened to destroy their fields, vexed with the attitude of the authorities in attending to their woes.

Following that the only palm oil producing company has come forward to pay Rs. 250 per tonne as incentive from July 2010 for the oil palm fruit bunches supplied by the farmers and the advances and the incentives would be adjusted against the final price that would be fixed by the State government, according to Mr. Rajaram who is also the Karur District Coordinator of Association of Oil Palm Farmers of Tamil Nadu.

It is in that context that Mr. Rajaram has noted that oil palm cultivators are looking up to the State government to fix a remunerative price for their produce by putting in place a market intervention scheme that would take care of the interest of all stake holders.

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