Wholesale price deflation for 11th straight month in September

But, food products witnessed inflation of 0.69% in Sept against a fall of 1.13% in Aug

General wholesale prices continued to fall for the 11th month in a row in September, but the decline decelerated to 4.54 per cent against 4.95 per cent in August. However, onions and pulses continued to witness increased price pressures, official data released on Wednesday showed.

The Consumer Price Inflation (CPI) rose to 4.41 per cent against 3.74 per cent over this period, data released earlier this week had shown. As such, there are price pressures in both CPI and the Wholesale Price Index (WPI) in September, particularly emanating from pulses and vegetables.

While inflation in onions rose to 113.70 per cent in September from 65.29 per cent in the previous month, pulses turned expensive by 38.56 per cent against 36.40 per cent over this period. However, wholesale prices of onions fell below Rs 30 a kg at the Lasalgaon market in Maharashtra, Asia’s biggest onion markets, on Tuesday.  These would be reflected in WPI inflation for this month, which would come out in November.

Aditi Nayar, senior economist with Icra, said, “High inflation for pulses and onions remained the chief concern amongst food items in September 2015. The fresh crop as well as arrival of imports of onions is expected to cool prices in the ongoing month.”

Given the unfavourable reservoir storage levels in the eastern, western, central and southern regions, the rabi crop and food prices will remain vulnerable to magnitude of rainfall in coming months, she said.

Wheat also saw inflation rising to 3.34 per cent from 2.05 per cent. Even in terms of broader food category, food products witnessed inflation of 0.69 per cent in September against price fall of 1.13 per cent in August. Even non-food articles in primary category (unprocessed) came out of deflation in September. Prices rose 2.61 per cent against fall of 0.69 per cent in August. This was primarily due to oilseeds, as they became costlier by 2.21 per cent, exact opposite to August when they had turned cheaper by 2.52 per cent.