Food prices will continue to pinch

Consumers may not have much respite from high prices of tur dal and other pulses in 2016. The production of pulses was down during the kharif and rabi season because of the erratic weather.

The prices of rice and wheat dep-ends on the harvest but they may be stable because of the stocks in adequate quantities in government godowns.

Sugar prices are expected to be stable. Vegetables may go up in June-July because the water table is very low. If however there is a good monsoon then prices won’t rise.

According to agricultural expert Vijay Jawandia the prices of pulses and edible oils are dependent on international prices and have nothing to do with minimum support price.

For instance, the MSP for tur is Rs 4,600 per quintal and gram is Rs 3,400 per quintal yet the price of tur dal has been hovering between Rs 160-200 per kg.

Mr Jawandhia does not see the prices of pulses coming down in the near future. Imported tur (from Myanmar and Tanzania where production was low) is still Rs 90 a kg. But since domestic tur is in greater demand (the taste is better), it may remain costly.

It was expected that when the new crop comes into the market, prices would fall. But this did not happen. Prices are around Rs 8,000 per quintal of whole tur while tur dal costs 1.4 times. In some places it is selling at Rs 160 per kg.

Palm oil is another commodity which is driven by global price. For instance, palm oil has been cheap in the global market only because crude prices have fallen steeply to around $45-50 a barrel. When crude oil prices were ruling at $140 a barrel pal oil prices had shot up to $1,400 per tonne.

Groundnut oil today sells at Rs 140 per kg because it is mixed with palm oil and cotton seed oil. Pure groundnut oil would cost around Rs 200 a kg as it requires 3 kg groundnut and the current groundnut price is Rs 5,000 a quintal or Rs 50 a kg.