According to the industry sources, the suppliers have begun withholding stocks in anticipation of better prices. There are, however, other factors behind the lower arrivals as well. With the government allowing kernel exports, exporters, barfi manufacturers and those requiring kernels for sowing purposes have begun to source their requirements direct from the farmers, triggering a price rise at that end too. Farmers are now selling 40 kg lots at rates ranging between Rs 570 -590.

All these factors played a part in prices of ground nut oil rising by Rs 100 to Rs 3800 per quintal. Kernel prices too have gone up to Rs 1350 per 80 kg bag.

The silver lining here is the fact that prices are not expected to rise past the Rs 4000 per quintal level as the palmolein priceswould then become a better alternative. However, there are little, if any, chances of prices dropping as arrivals are expected to stay between 400 and 500 tonnes per day, at least until the end of May. Consequently current prices would stay firm until then. The larger inflow of imports has also acted as a powerful deterrent on prices. That this price band would continue can also be gauged from the import contracts entered for the end of May. The market here is hoping that once the price touches the Rs 4000 level suppliers would begin loosening their hold.

But this looks unlikely to occur before the first fortnight of May.