COMA has alleged that dry coconuts (Undakkopra), which are primarily used for copra and coconut oil production, are often transported and invoiced as ordinary coconuts to avail GST exemptions. | Photo Credit: VIBHU H

The Cochin Oil Merchants’ Association (COMA), representing coconut oil millers, traders and allied industries in Kerala, has urged the State Government to introduce a regulatory framework for the trade and movement of coconuts, copra and coconut oil.

The Association argues that the absence of a monitoring mechanism has led to large-scale unrecorded and clandestine transactions, causing significant losses to farmers, traders and the coconut oil industry.

Thalath Mahmood, president of COMA, said that Kerala is one of India’s largest producers and consumers of coconuts and coconut oil, with thousands of farmers, copra manufacturers, oil millers and workers depending on the sector for their livelihood. However, unchecked inflow and outflow of coconuts and coconut products through informal channels are adversely affecting the industry.

The Association pointed out that neighbouring states such as Tamil Nadu and Karnataka regulate coconut trade through Agricultural Produce Marketing Acts, which provide for trader registration, movement permits, market fees and transaction monitoring. Kerala currently lacks a comparable system.

COMA has alleged that dry coconuts (Undakkopra), which are primarily used for copra and coconut oil production, are often transported and invoiced as ordinary coconuts to avail GST exemptions. This, it claims, facilitates tax evasion, suppression of taxable turnover and unfair competition for compliant businesses.

Recommendations

To address these issues, the Association has proposed a nominal market cess on the first purchase of coconuts, mandatory registration of traders, electronic documentation for bulk transport, digital tracking of inter-state movement and stronger border inspections. If a cess is not feasible, it has suggested exploring a revenue-neutral mechanism through the GST Council that would create an audit trail without burdening farmers.

The memorandum also seeks the formation of a committee comprising representatives from the Agriculture, Industries and GST Departments, the Coconut Development Board and industry stakeholders to recommend corrective measures. COMA has called for immediate action to safeguard Kerala’s coconut economy and ensure transparency in trade.

Published on June 24, 2026