NEW DELHI: Prices of pulses such as toor, urad and moong are likely to soar further this festival season starting end August, notwithstanding zero duty on import of pulses and a Rs 200-crore allocation in Budget 2009-10 for the import of pulses by parastatals.
Prices could ease marginally upon arrival of fresh stocks from Burma and Canada later this year, but the continuous decline in arhar would likely to keep prices firm despite better global supply. As a spinoff, vegetable prices could also shoot up.
On an average, import prices for key kharif pulses such as urad (matpe) and pigeon pea (arhar/toor) and yellow peas have gone up by a shocking $100 per tonne between March 2009 and May 2009, although prices for moong and lobia have remained static at $600-650/tonne and $450-$500/tonne, respectively. Accordingly, high prices are expected notwithstanding increased imports and domestic supplies. Despite sluggish export in May, traders expect exports from Myanmar to rise during the next couple of months.
Demand is likely to be spurred further due to a poor monsoon and the upcoming festival season. India’s average annual pulses production is pegged at 14 million tonnes while the average annual consumption is about 18 million tonnes. In the last three years, the average annual consumption has increased by around 1.5-2 million tonnes.
Kharif pulses acreage has increased to 38 lakh hectares by July 17, just two lakh hectares short of the acreage same time last year. Acreage in the week ended July 11 was a 90% jump over the acreage in the week ending July 4 this year. However, delayed kharif crop duration and lack of soil humidity could, according to farm sector monitors, affect kharif pulses crop prospects.
The country’s pulses output in 2008-09 is estimated to have fallen by 3.9% to 14.2 million tonnes. The Pulses’ Importers Association of India estimated that the country had imported about 2.5-3 million tonnes pulses in 2008-09. Battling rising prices globally, India, the world’s biggest producer, consumer and importer of pulses, allowed duty-free pulses import and banned export of pulses in 2006 which was extended subsequently till March 2010.
But lower stocks and good domestic demand at export destination meant that Burma (Myanmar), key exporter of pulses to India, exported only 74,501 tonnes of beans and pulses in May this year, down by 65% compared to the corresponding period last year. Tur whole (Pigeon pea) accounted for 45% of the total exports, followed by Matpe/urad (33%) and moong beans/moong (11%). India accounted for 81% of total bean and pulse exports from Myanmar.
The international price of pulses has been more than keeping pace with the increasing demand in India.
“Pulses prices are likely to be higher till December. Mere duty import won’t be able to ease prices as international prices, mainly in Burma, is higher and most likely to remain higher,” says Ajeet Kumar, research analyst at the New Delhi-based SMC Global Securities.
According to commodity monitors, factors such as soaring global prices, lower stocks in key exporter countries, increased annual consumption, lower domestic output, higher festival season demand as well as poor monsoon are likely to hit the price of pulses further in the rest of the year. To top it all, arhar production has been on the decline over the last three years and is expected to be lower this year (2009-10), too.
Source : The Economic Times