Consumers fighting a high food inflation have got some breather with the rupee becoming stronger against the dollar. Imports of pulses and edible oils have become cheaper and traders indicate that prices will remain steady till the Lok Sabha elections are over.
India, the biggest consumer of pulses, imports the commodity from countries like Canada, the US, Australia, Myanmar and South Africa.
"In the current fiscal, India is likely to import 2.5 million tonne of pigeon peas compared to 3 million tonne in the previous fiscal. The rupee getting stronger against the dollar will act as an incentive to importers and keep prices at a steady level in the market," said KC Bhartia, director, Indian Pulses and Grains Association.
Bhartia said prices of pulses will hover around Rs 70 per kg at least for next two months. India will be importing less pulses this year as pulses production has been on the higher side this year.
According to government estimates, the country is expected to produce 19.8 tonne of pulses this year, which includes 9.8 tonne of chana crop though the trade says that only 6.5 tonne of chana crop has been produced this year. The cooking oil segment seems to be the biggest beneficiary of a strong rupee, which has inched up to 60 level.
Imports of pulses and edible oils becomes cheaper; prices to remain steady till Lok Sabha elections Angshu Mallik, chief operating officer, Adani Wilmar, said, "We had thought of increasing prices as international prices of cooking oil were going up. But now that the rupee has strengthened, we do not see an immediate price increase. The commodity price has corrected too. And this trend is likely to continue till the general elections." Adani Wilmar sells cooking oil under the brand name Fortune.
Palm oil prices have gone up the most in past two months due to a dry spell in the two producing countries - Malaysia and Indonesia. Warm weather in February and March has affected the crop in these two southeast Asian nations. Reports say that palm oil stockpiles in Malaysia may have declined for a third month in March, falling to the lowest level in three years.
"Prices of palm oil had appreciated by $100 in the past two months. And this trend is likely to continue in the second quarter as well. However, the rupee getting stronger against the dollar will bring some relief to the cooking oil market. Consumers, who are otherwise burdened with inflationary pressure, may not see an immediate hike in prices," said BV Mehta, executive director, Solvent Extractors Association of India.
India is expected to import 10.5 -11 million tonne of edible oil in current oil year (November 1, 2013 to October 31, 2014) to meet its domestic demand. The country consumes 17 -18 million tonne of edible oil annually.
Source:- economictimes.indiatimes.com
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