Annual food inflation has picked up for the second consecutive week, with the food price index rising 17.56 per cent in the 12 months to January 23, higher than an annual rise of 17.40 percent in the previous week, data released on Thursday showed.
What may, however, lift spirits a little is the fact that the prices of pulses, a major contributor to spiralling food inflation, have declined over 40 per cent from their peak three months ago, on the back of rising arrivals and imports.
After hitting a high of Rs 55 per kg in November last year, urad has slipped to Rs 37 per kg now. Tur, the priciest variety, has declined to Rs 65 a kg from Rs 90 a kg around mid-November and chana, considered the poor man’s tur, has also fallen sharply to Rs 22 a kg against Rs 26 in the same period.
Pulses Importers’ Association President K C Bharatiya said farmers see no point holding on to their produce, since the government had doubled its import target to 4 million tonnes this year to soften local prices. As a result, arrivals in the local mandis have more than doubled to between 5,000 and 6,000 tonnes over last year’s level of around 2,000 tonnes. Pulses are mainly rabi crops that are harvested in the second fortnight of January.
India, the world’s biggest producer, importer and consumer of pulses, has allowed duty-free imports of pulses to bridge the widening gap between domestic demand and supply.
According to trade sources, major public sector companies, including MMTC, STC and Nafed, have sent their representatives to Myanmar, a key supplier to India, to book higher orders.
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India’s import target has been doubled despite higher domestic production this year. Data compiled by the Mumbai-based Pulses Importers’ Association show that India’s total pulses output is 2 million tonnes higher than last year’s level of 16 million tonnes.
India has been buying pulses at $750 a tonne, $150 per tonne higher than the level a week ago. But, the high import price is unlikely to reflect on local prices, because the government buying agencies get huge subsidies.
The Indian government's ban on pulse exports last year has also helped augment domestic availability.